President and CEO of Biopure Corporation
FROM:Hoang, Ann and Mishra, Ravi
RE:Whether and When to Launch Oxyglobin
Biopure needs to determine the best course of action to launch two new products, Oxyglobin a blood substitute for the veterinary market and Hemopure a blood substitute for the human market. Oxyglobin has been approved for commercial use and is ready for launch while Hemopure is expected to be FDA approved within two years. Biopure needs to decide whether and when to launch Oxyglobin. If decided to launch, the ability to price Oxyglobin appropriately is critical to minimize the impact of prospective launch for Hemopure. We believe Oxyglobin should be launched immediately because of realized potentials and benefits. The potentials are: to create a brand image for blood substitutes, to create a competitive advantage by first launch, to have the benefit of “go to market” with production, sales and distribution, and to create revenues to launch Hemopure. The potential revenues earned from Oxyglobin could be used toward building another facility for manufacturing of Hemopure. The possible obstacles Biopure might encounter with Oxyglobin are: veterinarians may not recommend and/or perform blood transfusions, the ability to produce Oxyglobin when Hemopure is launched, and Biopure has little or no experience with launching of high R&D profile products. Oxyglobin can be launched successfully because it is FDA approved and will be first in the market as animal blood substitute. As indicated on the survey, veterinarians may not recommend the use of it because it is an expensive product; however, pet owners showed interest and preferred to be informed of alternative treatments for their pets. Therefore, Oxyglobin should be launched with a starting price of $200 per unit. Biopure should use in-house sales force to distribute Oxyglobin to save approximately 30% of the fees charged by the third party distributors....