Pharmacia Case
Pharmacia & Upjohn, Inc.
Factual Summary:
Company Profile:
Pharmacia & Upjohn, Inc. was created with the merger of Pharmacia AB of Sweden and The Upjohn Company of US in 1995. Pharmaceutical products account for 90% of company sales; almost 70% of company sales are made outside USA.
Industry Profile:
Competitors: Bausch & Lomb, Alpharma and Lemmon Company.
26 % reported moderate to dense hair growth with the use of Rogaine as compared to 11% reporting moderate to dense hair growth with the use of Placebo (a liquid without 2% solution of Minoxidil)
Cumulative Worldwide Sales of Rogaine exceeded $1 billion. Product is most effective for the age group of 18 to 49 years.
Treatments of Balding:
1. Prescription and Nonprescription hair shampoos, lotions and conditioners.
2. Hairpiece or wigs, hair transplant and drugs such as Minoxidil for prominent loss.
American consumers spend about $1.3 billion annually for these treatments.
Case Problem:
What unit and dollar sales potential for the product category as a whole might be expected now that Minoxidil treatment for hair regrowth no longer required for prescription? Also how might the loss of US patent protection and marketing exclusivity that Rogaine had enjoyed since its introduction and competition from generic products affect sales of the Rogaine brand?
Alternative Solution:
1. Sell the new unprescribed product with 2% minoxidil at cheaper price to tackle the competition from fellow sellers.
2. Rebranding:Over The Counter sell
Selected Solution:
Since company has been in this market for a long time now, they have an edge over the new emerging companies. As far as selected solution is considered, i would suggest them to mix up both the solution and implement it. Since till date they had the patent to manufacture and sell the medicine, they charged the customers much higher than cost price. But now since the exclusivity period is over, they will have to reduce the price (as suggested to be around
Factual Summary:
Company Profile:
Pharmacia & Upjohn, Inc. was created with the merger of Pharmacia AB of Sweden and The Upjohn Company of US in 1995. Pharmaceutical products account for 90% of company sales; almost 70% of company sales are made outside USA.
Industry Profile:
Competitors: Bausch & Lomb, Alpharma and Lemmon Company.
26 % reported moderate to dense hair growth with the use of Rogaine as compared to 11% reporting moderate to dense hair growth with the use of Placebo (a liquid without 2% solution of Minoxidil)
Cumulative Worldwide Sales of Rogaine exceeded $1 billion. Product is most effective for the age group of 18 to 49 years.
Treatments of Balding:
1. Prescription and Nonprescription hair shampoos, lotions and conditioners.
2. Hairpiece or wigs, hair transplant and drugs such as Minoxidil for prominent loss.
American consumers spend about $1.3 billion annually for these treatments.
Case Problem:
What unit and dollar sales potential for the product category as a whole might be expected now that Minoxidil treatment for hair regrowth no longer required for prescription? Also how might the loss of US patent protection and marketing exclusivity that Rogaine had enjoyed since its introduction and competition from generic products affect sales of the Rogaine brand?
Alternative Solution:
1. Sell the new unprescribed product with 2% minoxidil at cheaper price to tackle the competition from fellow sellers.
2. Rebranding:Over The Counter sell
Selected Solution:
Since company has been in this market for a long time now, they have an edge over the new emerging companies. As far as selected solution is considered, i would suggest them to mix up both the solution and implement it. Since till date they had the patent to manufacture and sell the medicine, they charged the customers much higher than cost price. But now since the exclusivity period is over, they will have to reduce the price (as suggested to be around