Premium Essay

Biopure Harvard Business Case

In: Business and Management

Submitted By sukhada
Words 738
Pages 3
To: Carl Rausch
From: Sukhada Kulkarni
RE: Release of Oxyglobin
Date: October 30, 2013

The intent of this document is to provide suggestion for the timeline to release Oxyglobin. I would recommend releasing Oxyglobin to the market as soon as possible.

Situation Analysis:
There has been a debate if Oxyglobin release should be delayed by two years as it might jeopardize the sales of Hemopure. The concern here is that the estimated price of Oxyglobin ($150 per unit) might not allow Hemopure to be released at a higher estimated price as $600 per unit. As per my analysis this should not be a major concern as the advantages of releasing outweighs this concern. Here are the reasons why Oxyglobin should be released soon in the market: * As FDA approval takes time, being the first player in the market will give us an edge over the others and we will get an opportunity to establish Biopure. The possibility of success of Oxyglobin will become a platform for Hemopure to use the brand image already built. * The competitors Baxter Internationals and Northfield Laboratories are expected to release their products for human blood substitute at a price $600 to $800 per unit. The price of Hemopure should be compared against other human blood substitute as opposed to animal blood substitute. * As we do not have prior experience of going into market, this will be a good opportunity to experiment and learn before releasing Hemopure. It will also help us to form contacts with distribution networks, as our competitors have established distribution network. * This will be a good opportunity to generate our first profit. The estimated profit is around 20 to 34 million (Refer appendix).

Pricing Strategy:
I would recommend releasing Oxyglobin at a price $200 per unit because: * The average cost of a visit to vet is $60 but blood transfusion is an expensive…...

Similar Documents

Premium Essay

Daniel Kim Harvard Business Case

...board, due to the time constraints of the audit. Kim should minimize the time period to 48 hours to speak with board. If Sanchez speaks to the board within that time frame, the decision rests in the board’s hands to decide what to do. If at that point Sanchez has not spoken to the board in the allotted time, Kim should address the situation at hand to the board. When addressing the board, Kim should present them with a detailed outline that Sanchez is breaking policy by covering up personal expenses as business expenses. Then he should stress the importance of why he did not go straight to the auditors and plead for Sanchez to retain a job within company just maybe not as CEO. Action Plan Short Term - Kim will give Sanchez 48 hours to confess his financial offenses to the board o If Sanchez does not expose himself in 48 hours, then Kim will go to the board to reveal his wrongdoings - By doing this, Kim will prove that Sanchez is covering personal expenses as business expenses - The board will take further action at their own discretion Long Term (6 months) - Kim and the board will discuss the possibility of firing Ms. Jones due to conflict of interest - Kim will take drastic measures to monitor company spending and check spending frequently - Sanchez will work towards repaying the company for his personal expenses...

Words: 442 - Pages: 2

Premium Essay

Biopure Case

...Biopure Corporation: Case Write-Up Problem Definition In February 1998 Biopure Corporation faced a difficult decision regarding the launch of its newly developed “blood substitute” products. Biopure had developed “Hemopure”, a blood substitute for humans, and an ancillary product “Oxyglobin” for the veterinary market1. Hemopure was still in the process of gaining Federal Drug Administration (FDA) approval , while Oxyglobin had already been approved and was ready to be launched1. FDA approval was estimated to be two years away2, but this could change as the approval process is inherently complex and uncertain. The main problem Biopure faced was whether to launch Oxyglobin now, or wait until Hemopure was approved and launch both products simultaneously. This was a complex problem as the early launch of Oxyglobin would have both positive and negative repercussions for Biopure. These repercussions needed to be carefully analysed in order to decide what the best course of action is. Another problem was that Biopure had competitors with similar human blood substitute products in the pipeline 3 . Biopure have to consider how to position and price their products in relation to their competitors. An additional problem exists in the pricing of Oxyglobin and Hemopure in order to appeal to their respective markets4. Lastly, Biopure has no current cashflow and therefore needs to be successful with its upcoming IPO in order to raise the requisite cash and solidify its future5. Analysis......

Words: 1372 - Pages: 6

Free Essay

Biopure Case

...other competitors are in the vet blood substitutes market, Biopure will definitely have the first-mover advantage as long as they launch it in a timely manner/fast enough. Also any other competitors won’t be able to jeopardize the Oxyglobin’s profitability as it takes about 2 to 5 years for them to obtain FDA-approval. Assuming that Biopure decides to launch it, they also have to consider how much they are gonna charge for the product. In the first option, the price will be set at a low rate, ranged from 80 to 100 because pet owners are price sensitive. The average cost that pet owners spend per visit to the vet is about $60, which is pretty low. Also, Vets double the price as they sell the product so it is necessary to keep the original price low. For instance, even if Biopure sells a product at $50, Vets will sell the product at $100 to make profits. Therefore, pet owners will still feel that the price is beyond their budget and would go with a cheaper alternative available. (in a heartbeat). However, other sales team members claimed that it should be launched at a higher price carrying $200 premium, which is the second option. In case of emergency, pet owners are definitely not going to just let their pets die to save a couple of hundreds dollars. The price is anticipated to run from $200 up to $1000 in critical cases. Given that, the study has shown that 65% of pet owners are willing to pay $400 in critical cases, and 75% said they would pay $300. The other......

Words: 483 - Pages: 2

Premium Essay

Harvard Business Review Case: Starbucks

...Harvard Business Review Case: Starbucks Harvard Business Review Case: Starbucks This case study will review how Starbucks is doing financially, examine marketing segmentation and life style changes impacting Starbucks based on the Harvard Business Review case information, and what Hambrick strategy elements Starbucks should focus on most for improvement. “Starbucks’ brand strategy was best captured by its live coffee mantra, a phrase that reflected the importance the company attached to keeping the national coffee culture alive. From a retail perspective, this meant creating an experience around the consumption of coffee, an experience that people could weave into the fabric of their everyday lives” (Moon & Quelch, 2006). Starbucks is the largest coffeehouse company in the world. Starbucks Corporation operates as a roaster, marketer, and retailer of specialty coffee worldwide. Its stores offer coffee and tea beverages, packaged roasted whole bean and ground coffees, juices, various food products, as well as beverage-making equipment and accessories. In addition, it licenses the rights to produce and distribute Starbucks branded products, as well as licenses its trademarks through licensed stores, grocery, and national foodservice accounts. Over the last ten years, with the exception of 2008-2009, Starbucks has had at least 9 percent + revenue increases from year to year (revenue spreadsheet attached).......

Words: 1518 - Pages: 7

Premium Essay

Dragon Soup Harvard Business Case

...1. Using the excel spreadsheet provided, and the recommended consequential disclosures as a basis you your analysis, what recommendations would you give Phillips on each of the items listed below? In each case, justify your recommendations and estimate how much the decision will change the “true” value of the company and its value in the eyes of an investor in a private company. a. The lease or buy decision, including whether to structure as an operating lease. The new canning equipment should be leased over the 14 year term with no bargain purchase option so as to structure it as an operating lease. The major factor to consider is what will boost Net Income the most given that the goal is raise the share price. After a side-by-side comparison, the Net Income is greatest under an operating lease structure with the capital lease and purchase outcomes being equal thereafter. This is due to a couple of factors. First off, under an operating lease, the payments to the lessor are considered rent (S,G&A for this case) and do not include interest. Therefore, there is no interest expense of $50,000 under the operating lease however, that is offset by an increase in S,G&A expense ($85,870). Secondly, the lessee, Dragon Soup, does not have to expense depreciation which saves them an additional $50,000. This reduction is made to Cost of Goods Sold because under GAAP, manufacturing firms are to apply direct PPE expenses to inventory when it is sold. The result of this decision......

Words: 1306 - Pages: 6

Free Essay

Harvard Business School Case 707-512

...ankaj Ghemawat, Raymond Hill, L.G. Thomas "Southern Co. Investment in CEMIG" Harvard Business School Case 707-512 In the spring of 1997, Southern Company had the opportunity to acquire a significant portion of the electric utility in the Brazilian state of Minas Gerais. The shares in the utility, CEMIG, were being sold by the state government as part of a comprehensive privatization of Brazil's electric sector. Brazil's privatization was, in turn, part of a world wide movement toward deregulation and privatization of the electric sector. Like many of its rivals in the utility sector, Southern had committed itself to a strategy of growth by taking advantage of the significant opportunities for cross-border investment that were being created by this trend. The privatization of CEMIG was a particularly appealing opportunity for Southern. Not only was CEMIG one of the largest utilities in Latin America, but this investment would provide a base in the Brazilian market, which was expected to have the largest potential for further growth on the continent. Brazil was in the process of reforming its system of regulating electric utilities and of introducing competition into Brazil's wholesale generating market. These changes would further enhance the potential profitability of investing in CEMIG. In addition to the attractiveness of the investment, Southern had been able to secure non-recourse financing for half of the required amount. Keeping in mind Brazil's volatile economic......

Words: 266 - Pages: 2

Premium Essay

Harvard Business Case: Options

...futures price. In order to make a profit, one has to "buy low, sell high". As Ft(t,T) = $312.30 < Fa(t,T) = $313.55 Jim should short March'86 MMI futures contracts. Thereby, he can buy them at the theoretical price of $312.30 and sell them at $313.55. To short the futures, Jim has to buy the underlying. Therefore, he has to invest some money. Part of it will be the company’s own funds; the major part comes from borrowed funds. Jim can have a total position of $5,000,000. Jim has the restriction that 10% of this amount must be kept as margin. Therefore, he would borrow $4,999,516.42 from the bank at a borrowing rate of 8%. The cost of capital for company funds is expected to be higher. However, as this number is not explicitly given in the case, we assume that it is 8% too. The total price for the index is adjusted by a mark-up of 0.0025% for a round-trip impact. As he cannot buy partial stocks, he will only make use of $4,999,516.42 (see Figure 1). Jim will use this amount to buy 3628 shares of the index (more precise, shares of each component stock) on February 26th. Moreover, he shorts 64 contracts of March '86 futures. The number of contracts is rounded 64 as 4999516.42/(313.55*250). The cost for that at t is zero. To calculate the return at T, several calculations have to be performed. The following formula is applied to calculate the future value of the loan taken, in other words, what Jim has to buy back at T: 〖FV〗_l (T)=〖PV〗_l (t)e^r(T-t) with 〖PV〗_l (t) =......

Words: 1074 - Pages: 5

Premium Essay

Apple, Inc. Harvard Business School Case Analysis

...duplicate from the competition (Dess, et al., 2005). Sustaining a competitive advantage became hard for Apple Inc. as noticed in the Harvard Business School Premier Case. Therefore, this paper is an analysis of Apple, Inc. based on a 7-year old case written by David Yoffie and Michael Slind published by Harvard Business School (Yoffie, et al., 2008). The following paper examines in detail the strategies utilized by the company as outlined in the strategic management steps. Several recommendations are also proposed to handle the issues surrounding the organization. Summation Apple Inc. was created by two college dropouts, Steve Jobs and Steve Wozniak and later joined by A.C. Markkula, Jr; they created the company with one circuit board (Apple I) and turned into 200 sales within two months time (Yoffie, et al., 2008). The company developed a premium-price differentiation strategy; in which two years later, Apple II was introduced to the world. Apple II tripled company sales to more than 100,000 in less than two years compared to Apple I (Yoffie, et al., 2008). This paper analyzes and reviews the strategies utilized by Apple Inc. based on my comprehension of strategic management; and propose recommendations for several problems that Apple faced to become a successful billion dollar company. Situation and Pending Decision Analyzing the case presented a huge problem for Steve Jobs and his management team, was the company’s success acquired recently a temporary “up” in......

Words: 1367 - Pages: 6

Premium Essay

Zara Case Study Harvard Business School

...1. Inditex financial results compare to competitors. The four companies shown above have very different business models. Inditex owned much of the production and most of its stores. Inditex is thus a vertically integrated company. This made Inditex gain a competitive advantage, which is quick response to the market requirements. On the other hand, The Gap and H&M have a different business model. They owned most of the stores, but outsourced all the production. Benetton had a third business model. It invested heavily in the production, but licensees ran its stores. The most interesting company to compare Inditex is The Gap. Although The Gap has much higher revenues than Inditex (almost five times Inditex), it incurred a net loss, as opposed to Inditex, which achieved a 23%, return in investment. This is due to the extremely high costs of good sold for The Gap. This could be caused -at least partially- by the complete outsourcing of the production. They do not have enough control over the production costs. Although The Gap has larger market share than Inditex and has equity almost double that of Inditex, Inditex is much more profitable. 2. How specifically do the distinctive features of Zara business model affect its operating economics? Specifically, compare Zara with an average retailer with similar posted prices. Zara sources fabric, other inputs, and finished products from external suppliers. It has purchasing offices in Barcelona and Hong Kong. This gives Zara a......

Words: 1786 - Pages: 8

Premium Essay

Dupont Case Harvard Business Paper

...Silva A01139056 Case. DuPont Kevlar Aramid Fiber Industrial. The DuPont’s major core has been the creation and innovation of fibers for several uses, such as Lycra spandex fiber, diverse polyester forms, Nomex Aramid fiber and Qiana nylon. The invention of Kevlar brought a new market cluster for DuPont to develop, and that one is the tire and aerospace industries. The important assumptions to have in consideration before making a decision is to first know who your market target is, who your competition is, and the pros and cons to start to develop a niche in this industry, for that I mean, what would be the production cost and what would be the selling cost, knowing those data, you can estimate the profit for a certain period, and with that, you can know if its profitable to start in this area. It’s important to understand, before starting a business to have the whole thing strategically planned. To have a good innovation starting I would say you need to try to develop in a market pull instead of technology push. With this, is easier to get your technology out there and sell it for sure, because the market is already there waiting for something to solve their problems. Returning to the part of “to have to whole thing strategically planned”, it is needed to be said that, part of that plan is to know who your market is, as it was said before. Being a fiber product, in the first line of costumers, it can be said that the market attended would be car’s business (for all the......

Words: 748 - Pages: 3

Premium Essay

Ocean Carrier Case Solution, Harvard Business Case

...$4000 per day and are expected to increase with 4% per year. Capital expenditures are expected to be in line with the current levels of the remaining fleet. The scrap value of the vessel after 15 years is expected to be $5 m. All cash flows have been discounted using the companies hurdle rate of 9%. Through exhibit 5 to 8 we have forecasted the expected operating revenues, operating costs, cash flows and taxation for the investment in the new ship. Our calculations reveal, as shown in exhibit 2, that at the current hurdle rate of 9% the project is assumed to have a negative net present value of $6,968.828 if subjected to 35% taxation and a negative net present value of $1,228,132 without tax. As the net present value is negative in either case we concur that Ocean Carriers is better of not making the investment in the new vessel. Our proposal to the board is therefor to decline the offer of the three-year lease from the client. Sensitivity Analysis Due to concerns regarding regarding differences between the expected outcome and real outcome, the investment department have conducted a sensitivity analysis to take all possible outcomes into consideration. Our first concern is regarding spot prices as forecasted by the consulting firm. As seen in exhibit 3, an increase in spot prices by 2.8% is required to break even under the no tax assumption. For a 5% and 10% increase in spot prices, the NVP is positive $1 million and $3 million. However, we do not find it likely that......

Words: 1231 - Pages: 5

Premium Essay

Harvard Business Case

...Harvard Business Case 10-16-07 The Overhead Reduction Task Force: A Case Analysis The Facts Central Foods Corporation just hired a new General Manager, Georgia Dixon, to run the deteriorating Countertop Appliances Division. This new division was formed after Central Foods acquired Kitchen Help, Inc. six years ago. With sales decreasing quite dramatically over the past three years and overhead costs at their peak, Dixon is in charge of implementing positive changes in her department. For one of her first moves she appointed Larry Williams as head of the new Overhead Reduction Task Force. This task force is being formed to decrease overhead costs by 20% in the next four months while also increasing sales. External Factors Affecting CFC There are three main external factors that are influencing the overall sales production in this case. First off, one of CFC’s major competitors introduced a new household coffee maker that sold at the same retail price as CFC’s coffee maker, but CFC did not have the same innovation incorporated into their product. Secondly, another main competitor of CFC launched a new and improved microwave oven, which severely hurt Countertop’s sales of the same product. CFC’s product line still has not made a comparable substitute for this newly designed microwave oven. Finally, competitors’ pricing of the kitchen products was 10% lower than CFC’s pricing for the same products. CFC believed that these competitors would eventually have to......

Words: 2152 - Pages: 9

Premium Essay

Harvard Business Apple Case Study

...Harvard Business School Case Study Analysis Harvard Business School Case Study Analysis Description At the end of 2014, Apple Inc. recorded the most profitable quarter of any firm in history, and its market capitalization soon topped $700 billion. 'Apple Inc. in 2015' explores the history of Apple, its successes under Jobs, its continued growth under Tim Cook, and the challenges facing the company in 2015. With iPod sales continuing their freefall, tablet sales in decline, and the Macintosh's market share remaining small, Apple was increasingly dependent on the iPhone to drive its growth. Could Cook continue Apple's dominance in the smartphone market in the face of growing competition? Could he revitalize the iPad business, become a leader in payments, with Apple Pay, and replicate Apple's success in other device categories, such as the Apple Watch, the first new product the company had released since 2010? Introduction:   Apple Inc has been an icon in American industry over the last three decades. The CEO Steve Jobs did a remarkable job turning around the company that was nearly bankrupt in 1996, however after his death in 2011 the questions has been brought forward of how sustainable will Apple be without Steve Jobs. Apple has always been trying to be simple and bring easy to use   products to a large market of consumers. On the beginning Apple focused on producing low-cost computers merged with...

Words: 1666 - Pages: 7

Premium Essay

Harvard Business Case Study: China Walmart

...return customers if you have to sustain the great service expected from the customers. China’s consumers are not to kind on change, but as long as you provide the best service possible over and over they will continue to comeback. 2. Wal-Mart also has to consider sustainability when deciding their vendors. In order for Wal-Mart to be as successful as they are, they have to have top of the line products from top of the line vendors. Therefore, reliability is a must. As mentioned in the case, there were complications between Wal-Mart and the vendors specifically when it came to the Return to Vendors Programs. There was no control over the time the vendors had to collect the products that were unusable or destroyed which was supposed to be no longer than 14-days, but was rarely followed. 3. The distribution system for the United States and China are very different. Almost all of the sales that Wal-Mart had for its stores in the US passed through distribution centers, but less than half was the case for its stores in China. This was happening in China because the fresh foods such as: Fish, vegetables, bread, and fruits were being supplied directly from the supplier to the various supercenters. 4. When it comes to improving sustainability in Wal-Mart China’s distribution and retail operations recycling and reusing damaged pallets, carton, and plastic sheeting would help cut down on cost within the distributions centers. The public perception that a company renders when......

Words: 693 - Pages: 3

Premium Essay

Case Analysis: Airborne Express (a), Harvard Business School.

...Case Analysis: Airborne Express (A), Harvard Business School. Not so long ago, there was no such thing as overnight express service and freight delivery. Then Federal Express, United Postal Service (UPS) and Airborne Express, among six second-tier companies, came upon the scene. In 1973, Federal Express invented the concept of overnight express package, soon followed by the other two largest express companies–UPS and Airborne, during the 1980s. The fast growth of the Express Mail industry was mainly due to the success of the express delivery service. Thanks to Frederick Smith, a Yale undergraduate back in 1965, who had envisioned a whole different system on his economics term paper. Smith proposed an airline dedicated exclusively to express delivery of mail. Regardless of a “C” grade received on his paper, Smith incorporated Federal Express in 1971and officially began operations on April 17, 1973. Some of the features in the evolution of the Express Mail Industry includes but is not limited to the creation of the hub system and air express service. Created by Federal Express, the hub system is the symbol of the modern air courier industry. It made possible the large-scale, overnight deliveries and it has remained the standard operating method in use to this day. This system allows air courier industry to ship all freight to the company’s central hub, where it is sorted, and rerouted to its final destination. Also under consideration, the air express service played an......

Words: 1561 - Pages: 7