How best to exploit the opportunity presented by Oxyglobin without jeopardizing the potential of Hemopure is a tough problem for Biopure’s executive. According to the financial analysis, it is suggested that Biopure begin to sell Oxyglobin at $150 per unit to emergency care practice at the Veterinary Blood Market and have its own distribution network. This will make a profit of $5 million at first year and $17 million thereafter. The steadfast income will consolidate Biopure’s financial structure and enhance the competiveness of Hemopure. The potential annual values are $794 & $135 million for Hemopure & Oxyglobin respectively. The human blood substitutes market would be monopoly if only Hemopure released, so the Oxyglobin influence could be omitted. Otherwise, if competitors with similar selling price appear, production cost and capacity will dominate the market share. Unfortunately, the residual capital without launching Oxyglobin can not meet the cost requirement of a new production line. Therefore, launching Oxyglobin is a support rather than a threat. The marketing strategy of Oxyglobin will be mentioned below.
First, Biopure has to concentrate on the emergency care market instead of primary care market since the research shows relatively higher gross revenue in emergency care practices despite the rare 5% frequency. In addition, the annual requirement of blood transfusion in emergency care practices is approximately 900,900 units, which exceed 300,000 units – the capacity of Oxyglobin. In other words, the whole Oxyglobin can be successfully sold out because of the deficit blood supply. Furthermore, pet owners are more willing to pay for emergency care than pay for primary care. Therefore, Biopure can only focus its target on emergency care practices market in the initial stage. Second, $150 per unit is a proper price for Oxyglobin because of the results offered by the pet owners’ and veterinarians’ surveys. The results indicated that $150 and...
Please join StudyMode to read the full document