Burroughs Wellcome Case Analysis Essay

1126 Words Mar 31st, 2012 5 Pages
Clarissa Kowalczyk
April 3 2012
MAR 499
Case Analysis

Burroughs Wellcome Company: Retrovir
Summary and Recommendation:
As I have read the case it was presented that in January of 1990, Burroughs Wellcome executives were under continued pressure to reduce the price of Retrovir, a drug which had been found to be effective in the treatment of acquired immune deficiency syndrom (AIDS) and human immunodeficiency virus (HIV). After careful review of the data and the case I have come up with the recommendation for the company to maintain the current price of Retrovir.
Background:
Burroughs Wellcome Company produced a drug that proved to be the number one treatment of acquired immune deficiency syndrome (AIDS) in 1987. The company has
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However, the fatality rates have significantly decreased from 91% in 1981 to 46% in 1989.
Unfortunately there are economic consequences of being and AIDS patient because it can be quite expensive. A person can spend anywhere between $70,000 to $141,000 in medical costs where a leukemia patient only incurs about $29,000 or a digestive track cancer patient about $47,000. AIDS patients either received care from Medicaid who spent about $750 million annual or private insurers who spent about $250 million all on AIDS related medical payments.
When the HIV virus was identified in the 1980’s, many companies began to search for an antiviral drug but Burroughs Wellcome led the research effort. There were three drugs being tested by other companies as well including, AZT by Burroughs Wellcome, DDI by Bristol Myers and DDC by Hoffman-LaRoche. These drugs inhibit reproduction of HIV and slow the damage it causes.
The social and political milieu of the HIV/AIDS virus emerged in the gay communities of several metropolitan areas in the United States. When the virus emerged, it was a time of sexual freedom and gay liberation which created conditions that permitted the epidemic to spread rapidly. The milieu created AIDS activists and a number of community based organizations. With all of this in Burroughs Wellcome’s environment, exhibit 1 show that their proximate environment is AIDS patients, competitor’s treatments,

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