1. What is the strategic decision Nucleon was to make?
• Before Nucleon can begin clinical trials, its management must decide how and where to manufacture the product. Three options are being considered:
1) Build an in-house pilot plant
2) Contract production to a third-party
3) License the development, manufacturing, and marketing rights to a corporate partner.
• The main issue is that Nucleon has to be able to find enough cash in-flow not only for the founding of the clinical trials for CRP-1, but also for the further development of the two new cell regulating factors and of the mammalian cells fermentation technology. Therefore, by choosing its manufacturing strategy, Nucleon should not only focus on the percentage of the
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- Mammalian cells fermentation.
- Strong links with big pharmaceutical companies.
- Other therapeutic applications of the CRP-1 molecule.
- Two new cell regulators factors in early stage of development Threats.
- Enormous cost of the drug development process.
- Uncertain outcome of clinical trials.
- Challenge of the patent by the competition.
- Uncertain biotechnology patent law.
- Competitors using alternative technology to develop drugs for the same diseases.
- As the article mentioned, it is important for us to get our products into the clinic before others do.
-Capabilities: When the company grew to 2 employees, there were about one third that had PhDs from scientific disciplines such as biochemistry, molecular biology, protein chemistry, and immunology. They were all strongly attracted to cutting edge, product-oriented research. • Threats:
- Small size (22 employee) private held company
- Weak patent position on the genetic sequence
- Capital availability
- R&D resources focused on the CRP-1 molecule
-Technology was enormously complex, time consuming and expensive.
-There were big risks in going ahead with development before the granting of a patent.
-Although Nucleon was a leader in cell regulating factors, the company was not free from competition.
-Other companies were developing drugs using somewhat similar technology.
-Nucleon management believed that the company could not afford to market its products on its
1. In no more than one-page, describe Biometra and the industry that this company is in.
3. No new drugs are to be available in the market for this indication in the next 5 years so it makes the product very lucrative.
There are multiple health concerns worldwide and more and more drugs are needed every day. Many drugs however, are extremely expensive to develop, test, and produce. According to the Tufts Center for the Study of Drug Development (2002), it costs up to $802 million to bring a new drug to the market. In 2002, pharmaceutical companies spent $34 billion in research and development (Center-Watch, 2003). In addition to the costs, the overall time from the discovery to approve and market the drug can take up to 15 years.
The challenges faced by Nucleon, Inc. present more of an issue with how to take full advantage of an opportunity in front of them, rather than a problem that poses a threat to the company. As a company in its early stages, only putting out its first product, it is critical that it is done in a manner that allows the budding firm to grow. The main issue here is determining the most effective means by which they are to manufacture and market their first product, CRP-1. Doing so requires in-depth evaluation of three strategic options, all with their own benefits and potential risks. The problem statement, therefore, is as follows:
* No foreseeable new product in pipeline. Currently takes up to 11,000 compounds to be screened to find one (1) compound to send through final testing (human trials). And even then it’s not guaranteed to make it past the FDA.
3/ What is your recommendation regarding Nucleon’s long-term manufacturing strategy? What should this company look like in 10 years (e.g. an R&D boutique, an R&D boutique with pilot scale manufacturing capabilities, or an integrated manufacturing enterprise)?
Having estimated gross sales (Table 4) up to the year 2002, we can estimate revenues for each option for phase III. Although Nucleon in initial has to invest huge amount of money for plant facility and development resources for commercial manufacturing, however, it can give Nucleon a significant revenues compare to licensing.
Eli Lilly’s decision to create a joint venture was not surprising (figure 1). The India government limited foreign direct investment to 51%, importing was subject to manufacturing at high costs outside the country and then paying high importation tariffs, and licensing was not prudent due to an absolute lack of product patents laws that were needed to protect Eli Lilly’s intellectual property.
Even though I think conducting clinical trials in emerging economies is beneficial to the firm, Novo Nordisk should still follow below guidelines for this major decision to protect its own reputation and serve the best interest for every stakeholder:
But researchers are notoriously difficult to manage. A strategic plan cannot force a research breakthrough. Within Amgen therefore 20% of the researchers’ time is free to use as they themselves see fit.
The second alternative will allow Nucleon to have a manufacturing strategy with less risk since this option requires no capital investments on Nucleon’s part. Compared to the first alternative, the contract-manufacturing fee is less ($4.8 M) and companies supplying contract-manufacturing services will provide facilities and
There are many competitive forces that are affecting Nucor Corporation. Some of the primary ones are the market size, number of rivals, and pace of technological change.
Achieve a median composite eight-year product development cycle by 2010. Deliver two new molecular entity (NME) launches on average per year from 2010. In order to achieve the above objective, ensure that we have 10 or more NMEs in Phase III development by 2010. Development cycle times and quality for small molecules and biologics. Number of NME launches per year. Attrition rates. Number of development projects by phase. Number of in-licensing deals, alliances and acquisitions. R&D investment levels. Improving R&D quality and speed through leading-edge science, effective risk management and decision-making and overall business efficiency. Maximising the value of our biologics business and continuing to build a major presence in this fast-growing sector. Investing in external opportunities to enhance our internal innovation through in-licensing, alliances and acquisitions. 2008 target exceeded for small molecule development cycle times. NME and life-cycle management progressions
Extremely risky drug discovery and development, lengthening development times which increase development cost, return on investments, and generic competitors.
There are several rewards to consider with expansion of Biocon. Currently in India, there is a growing market for contract research organization and the growth of Biocon falls right within this opportunity. The growth is expected to last for more than few years with a rate that looks promising. Clinigene is expected to reap revenues much higher than the current Biocon and Syngene combined (Kalegaonkar A., Nov 4, 2008). It will take clinical studies to a higher level with better options in terms of drug manufacturing. With other countries ready to outsource the service of clinical studies, Clinigene’s future looks bright.