Case Analysis

of
Biopure
Corporation
GROUP 4
MOHIT SINGH DHARMSKTU
ASHISH GANDHI
CHANDAN MISHRA
RAHUL AGRAWAL
RAHUL RAJ

Reasons for immediate launch

Revenues generated from the sale of Oxyglobin could be used in the

launch Hemopure

Understand what all it takes to enter the market and make any
mistakes during the launch of Oxyglobin rather than in Hemopures
launch

The human market would be always attractive and could be

leveraged anytime

Reasons against immediate launch

If Oxyglobin be launched at relatively low cost, a high price of

Hemopure could not be justified

In case of an IPO, the company will not be able to get decent equity

Unpopularity due to Side effects

Marketing Potential of Oxyglobin

For Canines
Total Practices = 15000

Primary care practice

Emergency practice

14250

750

Units of blood transfused per practice

17

150

Total

242250

112500
354750 Units

Canines represent 50% of the total blood transfusion by volume

Assuming others also require same amount of blood in each whole blood unit

Market Potential -

709500 Units

Marketing Potential of Hemopure

Q.3

Total Units (millions) -

8.1

1995

2030

Consumption in 1995

Consumption in 2030

Over 65 Population

15

30

3.24

6.48

Total Population

85

120

11.3

13.56

Total -

14.54

Considering Linear Increase

Consumption

increase

Over 65 Population

3.24

14.29%

3.702857143

Total Population

11.3

2.86%

11.62285714

Total -

Consumption in 2000

15.32571429

20.04

Impact of Oxyglobin pricing on Hemopure

Oxyglobin price will impact on Hemopure, as the products are not

interchangeable

Bench mark price points:

For anonymous donation : $125 - $225

For autologous donation: $275 - $425

Moreover, if competitors sets the price, those prices will become the
benchmark prices. (Anticipated price by Baxter $600-$800)

Human blood market

Around 14 mn units of RBCs are available from donation

RBCs: Low rate of donation and short shelf life, thus periodic shortages

Demand of RBCs is expected to rise by 2030

Donated RBCs has a lot of limitations:

need of exact blood type matching

reduced O2 carrying efficiency

limited shelf life

need of refrigeration

risk of disease transmission

Potential market = 11.3m units/year (8.1m acute blood loss; 3.2m chronic
anemia)

At price of $700/unit the market is worth $7.9Bn/year

Veterinary blood market

Blood transfusions were infrequent

About 30% of cases would have benefitted significantly from

transfusions, only 2.5% actually received it

There was inadequate blood supply and few animal blood banks

Primary care practices blood requirement cost $80 to $120 /unit,

emergency ones cost $130-170 /unit

Lack of time and resource to type the donor and blood recipient.

84% of veterinary doctors expressed dissatisfaction with the

currently available blood transfusion alternatives

CHALLENGES IN GO TO MARKET
STRATEGY FOR OXYGLOBIN

Biopure has never launched a product before

Oxyglobin and Hemopure had similar physical appearance, so low prices

of oxyglobin might jeopardize the premium Biopure could have charged
for Hemopure

Average charge per visit for veterinarian was $58 and blood transfusion
was $100, so how well would you do in the market at prices as high as
$150-200

How to price Oxyglobin?

How to distribute Oxyglobin?

How to educate people about the benefits of Oxyglobin