This document provides a situation analysis for a biotech company, Biocon, as it considers launching a new drug called BIOMab to treat head and neck cancer. It analyzes Biocon's capabilities, the market potential, competitors, and alternatives for launching BIOMab. The recommendations are to launch BIOMab immediately after approval to gain a first mover advantage, price it lower than competitors, target top oncologists directly, and promote it through continued medical education for doctors.

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Apoorva Bajaj (Roll 248)
Divva Gandhi(Roll 258)
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Problem Statement
 The company no knowledge of dealing with new technology.

2.  Lack of knowledge of financial investments required to setup the plant.
 Inexperience in marketing and selling oncology drugs.
 Inexperience in conducting clinical trials.
 Competitor had more experience in head and neck cancer market.
 Lack of knowledge in manufacturing the product.
Major Issues
 When to launch BIOMab: Immediately after the phase II trials or after the completion of
phase III trials.
 What should be the launch strategy-product portfolio, price, channel (place), marketing
communication (promotion).
Situation Analysis
COMPANY
Biocon, from a very humble beginning in 1978, grew to be one of the top players in the
pharmaceutical sector by 2006. Started by Dr.Mazumdar-Shaw as a JV with
BioconBiochemicals of Ireland, it went on to become a leading enzyme manufacturing company.
Company decided to enter the biopharmaceutical market due to the huge potential. It started
making statins and insulins. By becoming a full-fledged biotech company it was able to make a
hugely successful IPO. But realising the need for a proprietary drug, it was contemplating the
launch of BIOMab, a drug for head and neck cancer.
CUSTOMER
Though the end-users of the product were cancer patients, it was the doctors which any
pharma company would target first. So the oncologists were the primary customers. The drug,
being very high-end, was prescribed only by top oncologists of the world. So the target was very
less; only in the range of around 300. But the consumers were the cancer patients. The market
for BIOMAb in India was huge. Around 21% of the people with head and neck cancer were from
India. The number of people affected by cancer was also growing at a fast pace every year.
COMPETITOR
Erbitux, a drug developed by ImClone Systems and marketed by Merck, was the primary
competitor for BIOMAb. It was a drug initially developed for colorectal cancer. But Merck had
conducted phase-3 trials and received approval from authorities for use in treating head and neck
cancer. Erbitux worked well in tandem with chemotherapy and had an advantage of being in the
market for three years. But it also had a minor drawback. It caused skin rash in patients because
it was chimeric.
COLLABORATOR

3. CIMAB was the primary collaborator of Biocon in this project. All other things were
managed by Biocon and its subsidiaries (syngene, clinigene)
CONTEXT
The entire confusion regarding the planning of the launch hinged on the context. Having
already completed phase-3 trials, Erbitux was planning to get approval from DCGI by late 2006.
So Biocon had to decide whether to conduct phase-3 trials or accelerate the product launch and
get the first mover advantage.
Analysis of Alternatives
Launch BIOMAb immediately Launch a group of cancer
generics first and BIOMAb
later
Simultaneously launch
BIOMAb and other cancer
generics
Pros:
First mover’s advantage
Cons:
Phase 2 results might not be
enough to convince
Oncologists
Monetary, legal and social
implications in case of
unexpected behaviour of the
drug are tremendous.
Limited or no sales
capabilities available with
BIOCON.
No experience in selling and
marketingoncology drugs. Do
not know the patients and
physicians in this field.
Pros:
Chance to build sales
capabilities
Ease to migrate to high end
speciality products like
BIOMAb later when phase
three results are available
In case of a late entry than
Erbitux,cost of educating the
patientsmay be less because
of similar genre of products.
Cons:
First mover’s advantage may
be lost.
Pros:
 May be a better a chance to
make a compelling pitch to
Oncologists
 Salesrepresentative may get
more time with the doctor
 Additional revenues to
support other involvements
Cons:
 It may dilute the Biocon’s
brand value as the only
Indian proprietary drug
company.
Market Potential :
Calculation
Potential Market 1900 (Head & Neck Cancer Patients)
Market Share Revenue (in $) Share of BioMab
10% 1140000 15.83%
20% 2280000 31.67%
30% 3420000 47.50%
40% 4560000 63.33%
50% 5700000 79.17%
60% 6840000 95.00%

4. 70% 7980000 110.83%
80% 9120000 126.67%
90% 10260000 142.50%
100% 11400000 158.33%
SWOT Analysis
STRENGTHS
1. Market price very low as compared to its
imported competitor.
2. BioMab phase 2 trial results have shown
100% response in patients.
3. Lesser side effect
WEAKNESSES
1. No Knowledge of dealing with
mammalian cells
2. Lack of manufacturing know how
3. Lack of experience in marketing and
selling oncology drugs
OPPORTUNITIES
1. With phase 3 testing, 3016 patients
can be targeted and breakeven can be
achieved in 5 years in comparison to
phase 2 testing where breakeven can
be achieved 8 years.
THREATS
1. Competitive reaction- Since BioMab
has not proved its phase 3 records
competitors can use this against them.
2. Sales Capability: Lack of good sales
network
3. Inability to convince oncologist to
adopt BioMab over its competitor.
4. Selling BioMab with generic drugs
can dilute its image as India’s first
proprietary drug.
0%
50%
100%
150%
200%
250%
300%
1 2 3 4 5 6 7 8 9 10
Biomab's share in
Biocon's Revenues
BioMab's market Share

5. Calculation:
Note 1:
Investment = $25million
Profit (on $1000/dose) = 30% = $300
Thus, number of doses needed = 25m/300 = 83,330 doses
Market potential = 1900 * 6 = 11400 doses
Therefore, no. of years to breakeven = 83330/11400 = 7.5 years approx.
Note 2:
Investment = $25million
Cost incurred per dose:
 Cost of goods = $250
 R&D cost = $ 150
 Marketing cost = $450
Profit (on $3000/dose) = $2300
Number of dose needed = 25000000/2300
= 10870 doses
We take a conservative assumption that they would be able to capture only 30% of the market
due to late entrance and the market size would not increase.
Market = 30% of 1900 = 570
Number of doses = 570 * 6
= 3420 doses per year
Therefore number of years for break even = 10870 / 3420
= 3.2 years approx.
Recommendations
Launch BioMab immediately after approval to gain the first mover’s advantage.
Product
Launch BioMab as a stand-alone product in the Head & Neck Cancer Drug market.
Price
The product shall be priced at $ 1000 compared to international prices of $ 4000-$5000.
Place
Ternary health care centers in India targeting oncologists directly.

6. Promotion
Target doctors by educating them about the product so that they become knowledgeable and then
use it in their practice. CME (Continued Medical Education) can be a medium to promote the
product.