BIOPURE

Biopure Case Study Biopure Corporation Case Analysis Issues: A. How do we best market Oxyglobin? (promotion) Alternatives: 1. Go with an independent distributor with their own sales force Pos: infrastructure already in place (database contacts, etc) Neg: They also distribute for other manufacturers (whats to stop them from distributing directly competitive product? Neg: 15 minute visit per salesperson- focus is divided among all the other products they sell Pos: They are able to set up a centralized training session for distributors (?? Time/money, etc) Pos: Experienced salespeople- if its a good product, they can/will want to sell them 2. Manufacturer sells products directly Control over sales practices Cost of maintaining the sales force Cost to physically distribute ($10-$15 more) per unit (should go under distribution?) 3. Use trade publications 4. Market Trade Shows (could be combined or separated) Taken seriously by attendees Only 5 publications, easy to advertise to Journals are effective vehicles to communicate the product Taken seriously by attendees (6 TS/year) B. Whether and when do we launch Oxyglobin? (Product) 1. Launch Oxyglobin first Get immediate revenue Will add value to the public release of company because they already have a working profitable product There is currently a need for veterinary use (it will help save animals lives) Spent almost nothing to develop Oxyglobin Lower manuf cost, can make more for the same resources Large capacity Already have a C.S,, Tech team to support it Studies on $$ and No foreseable competition (2 years behind) They can learn from potential mistakes May find additional benefits

 Will be good for Hemopure later on because people would already be comfortable with the idea of using a substitute There was already a press release from The Boston Glove in 2/5/98 Pricing structure of Oxyglobin will make customers question Hemopure pricing structure later 2. Launch Oxyglobin after Hemopure Wont jeopardize Hemopure Need will still be there Low price will be explained [next page] explained by the application (psychological aspects) There was already a press release from The Boston Glove in 2/5/98 Will open room for competitors to start doing clinical trials for veterinary usage Production infrastructure already in place Will give available capacity to Hemopure which is more expensive Oxyglobin release will be easier (less cost to market) because people will already be more familiar and hopefully trust the idea of a blood substitute 3. Do not launch Oxyglobin Idle capacity not being used Spent $200 million to make Hemopure- cant take the chance Spent $200 million to develop the product- get some of the up front cost first Idea of a company with no released product- harder to sell to the public Launching Hemopure would be the first time people will be universally exposed to the idea of substitutes People will be hesitant to the idea if it wasnt sufficiently tried on animals first If people find out- they will be enraged that the launch was delayed (i.e. not be able to save lives of animals) for the sake of marketing Press has already been informed- anticipation is out there C. How do we launch Oxyglobin without jeopardizing the potential for Hemopure (Promotion) D. How do we best distribute Oxyglobin? (Place) 1. National Distributors 2. Regional Distributors 3. Trade Shows 4. Publications E. How much should we sell Oxyglobin for given that it is similar to Hemopure? (Price) 1. $200: Higher than donor blood 2. $100: same as donor blood 3. Lower than animal blood F. When introduced, should Hemopure's price be equivalent to its competitors, or should it be reduced in consideration of the price paid of Oxyglobin? G. What promotional tools should Oxyglobin use to reach the veterinary markets?

H. What promotional tools should Hemopure use to distinguish itself from its competitors? Strengths and Weaknesses Strengths Weaknesses Sales Organization already in place for Oxyglobin HR Biopure is going public in the near future Biopure is going public in the near future $200 million dollars in development (high compared to competitors) FINANCIAL The public has already been informed (Boston Globe Article) Short half life Oxyglobin and Hemoglobin are bovine sourced- more abundant and less expensive resource COST