Nell Financial Consultant Stephen Risk Consultant Amy Marketing Consultant Fevzi General Consultant Tuba Marketing C

1. Biopure Berkeley Consultant Group Nell Financial Consultant Stephen Risk Consultant Amy Marketing Consultant Fevzi General Consultant Tuba Marketing Consultant Hye Young Chief Consultant Hakan Marketing Consultant

2. Content • Introduction • Dimensions • Decision • Marketing Strategy • Financial Analysis • Conclusion Marketing BA 160

3. Company background Privately owned biopharmaceutical firm Potential products: • Content • Introduction • Company Background • Problem • Recommen- dation • Dimensions • Decision • Marketing strategy • Financial Analysis • Conclusion Hemopure Oxyglobin For Human usage Awaiting approval by FDA For animal usage Ready to launch Marketing BA 160

4. Should we launch Oxyglobin? If we launch Oxyglobin, at what price? How should we market Oxyglobin? • Content • Introduction • Company background • Problem • Recommen- dation • Dimensions • Decision • Marketing strategy • Financial Analysis • Conclusion Problem Marketing BA 160

5. Content • Introduction • Company background • Problem • Recommen- dation • Dimensions • Decision • Marketing strategy • Financial Analysis • Conclusion Recommendation Launch Oxyglobin now ! Retail priced at $200 ! Marketing BA 160

6. Product-analysis Market-analysis Consumer behaviour Competitors • Content • Company background • Problem • Dimensions • Decision • Marketing strategy • Financial Analysis • Conclusion Dimensions to consider Marketing BA 160

7. Content • Company background • Problem • Dimensions • Product- • Analysis • Market Analysis • Consumer Behavior • Competition Analysis • Decision • Marketing strategy • Financial Analysis • Conclusion Strengths Weaknesses -„universal“ blood substitute - reliable and stable suppliers - free of contamination - storable up to 2 years at room temperature - 100% efficient at transporting oxygen - short half-life - potential for higher toxicity Product-Analysis Marketing BA 160

8. Human - 40% of the market is for individuals over 65 - 65 and over cohort is expected to double by 2030 - Risk of disease transmission discouraged rates of donation • Content • Company background • Problem • Dimensions • Product- • Analysis • Market Analysis • Consumer Behavior • Competition Analysis • Decision • Marketing strategy • Financial Analysis • Conclusion Market-Analysis Decreasing number of donors but increasing number of recipients • Animal • - 15,000 veterinary practices are present • Approx. 350,000 units per year just for dogs • alternatives priced $ 80 - $120 for primary care practices • alterantives priced $130 - $ 170 for emergency care practices • 84% of veterinarians are dissatisfied with the current process Marketing BA 160

9. High price sensitivity for animal market Low price sensitivity for human market Fear of contracting diseases In critical cases, 85% of owners are willing to pay $200/unit of Oxyglobin • Content • Company background • Problem • Dimensions • Product- • Analysis • Market Analysis • Consumer Behavior • Competition Analysis • Decision • Marketing strategy • Financial Analysis • Conclusion Consumer Behavior Marketing BA 160

10. Human Market Competitors Baxter International Northfield Labs Cost advantage (raw material) Independent from human blood Does not require refrigeration Animal Market No competition in terms of blood substitutes • Content • Company background • Problem • Dimensions • Product- • Analysis • Market Analysis • Consumer Behavior • Competition Analysis • Decision • Marketing strategy • Financial Analysis • Conclusion Competition Analysis Marketing BA 160

11. Content • Company background • Problem • Dimensions • Decision • Reasons • Risks • Marketing strategy • Financial Analysis • Conclusion Reasons to launch now • Establish „Biopure“ • Test out the marketing strategy • Test out the manufacturing machines • Create revenue • Avoid negative press • Gain experiences with the blood substitute market Marketing BA 160

12. Unrealistic price expectations for Hemopure Solution: Communicate the difference between Oxyglobin and Hemopure • Content • Company background • Problem • Dimensions • Decision • Reasons • Risks • Marketing strategy • Financial Analysis • Conclusion Risk: Price Difference Marketing BA 160

13. Oxyglobin fails Solution: The lack of competition and sufficient demand minimizes the risk of failure • Content • Company background • Problem • Dimensions • Decision • Reasons • Risks • Marketing strategy • Financial Analysis • Conclusion Risk: Product Failure Marketing BA 160

14. Stereotyped as animal care supplier Solution: Well tailored marketing strategy • Content • Company background • Problem • Dimensions • Decision • Reasons • Risks • Marketing strategy • Financial Analysis • Conclusion Risk: Image Stereotyped Marketing BA 160

15. Content • Company background • Problem • Dimensions • Decision • Marketing strategy • Financial Analysis • Conclusion Marketing strategy overview • Image • Mediums • Distribution channel Marketing BA 160

16. Life saver, not just pet saver Revolutionary practice of medicine Innovative, first mover • Content • Company background • Problem • Dimensions • Decision • Marketing strategy • Image • Mediums • Distribution Channel • Financial Analysis • Conclusion Image Marketing BA 160

17. Content • Company background • Problem • Dimensions • Decision • Marketing strategy • Image • Mediums • Distribution Channel • Financial Analysis • Conclusion Mediums • Trade publications • Journals • Pamphlets • Web site Marketing BA 160

18. Distributors 30% of price per unit Settled distribution system Experienced Economies of scale • Content • Company background • Problem • Dimensions • Decision • Marketing strategy • Image • Medium • Distribution Channel • Financial Analysis • Conclusion Distribution channels • 30% of price per unit • Settled distribution system • Experienced • Economies of scale Manufacturer direct • $10 - $15 per unit + expenses for sales force • Better for well established and high volume products Marketing BA 160

19. Price of $200 unit price $100.00 unit variable cost distributors $ 30.00 raw material $ 1.50 unit contribution $ 68.50 Fixed cost production $ 15 m marketing budget $ 1 m • Content • Company background • Problem • Dimensions • Decision • Marketing strategy • Financial Analysis • Conclusion Financial Analysis Marketing BA 160

20. Content • Company background • Problem • Dimensions • Decision • Marketing strategy • Financial Analysis • Break even • Conclusion 234,000 Break-even Marketing BA 160

21. Use Distributors Marketing activities Implementation of company sales force, after products are established Use profits from Oxyglobin to expand capacity Launch Oxyglobin, retail-priced at $200 • Content • Company background • Problem • Dimensions • Decision • Marketing strategy • Financial Analysis • Conclusion Conclusion Marketing BA 160

22. Questions ?

23. Appendix Calculation for dogs 14,250 (95% of 15,000 practices) x 17(units per practices) x 0.4 + 750(5% of 15,000 practices) x 150(units per emergency practice) x 0.85 = 192,525 192,525 x 4.5 / 2.5 = 346,545 units Assumptions: 4.5 of acute blood loss get a transfusion (84% of veterinarians are dissatisfied with current process)