Biopure Corporation Case Study

Biopure Corporation Case Study

Problems Summary:

Biopure Corporation was founded in 1984 aiming at developing a human blood substitute, which can reduce many limitations of donated blood. After many years of research and development, Biopure just received FDA approval for the commercial launch of Oxyglobin, a veterinary blood substitute for use in dogs, and the other blood substitute Hemopure used in human is still about 2 years away from final government approval and commercial launch. As a result, Biopure must decide whether to immediately launch Oxyglobin into the veterinary blood market or delay the release until after the approval and establishment of Hemopure in the human blood market and what strategy should be launched to ensure that that the potential of Hemopure is not jeopardized.

Analysis of the Problem:

There are four aspects company need to understand and think about before making a decision to launch Oxyglobin and cultivate the market.

• Due to the unstable and inadequate blood supply in veterinary market, 84% of veterinary doctors are urge alternatives to the blood transfusion. The success of putting Oxyglobin into commercial use will solve the shortage of animal blood donated and help Biopuren to easily launch Hemopure.
• Oxyglobin has received the approval of FDA, that is a time-consuming process and a requirement for any company which want to release their medical products in marketplace. It means Biopure will be the first one to enter veterinary market and can earn the biggest market share, since the other competitor can’t gain FDA approval in a shore term.
• Oxyglobin and Hemopure were almost identical in physical properties and appearance, hence it was possible that launching Oxyglobin at a higher price would create an unrealistic price expectation for Hemopure eventually.
• Biopure is lack of prior experience in launching a product incorporating immense R&D, since this is a first product if company launch Oxyglobin

Management team need to understand that whatever strategy will impact their launching of Oxyglobin and the future release of Hemopure

Recommendations:

• Waiting for Hemopure to launch both products at the same time. However, the two years will give Biopure more opportunity to explore how to market Oxyglobin and improve the medical utility of this product, it also put the company in a risk because of the possibility of competitors’ entrance to the veterinary market and lose their competitive advantage in the animal market.
• I prefer to Introduce Oxyglobin with the price of $200 and distribute Oxyglobin by using its salesforces. Since it is a strong market potential for Oxyglobin even with the limited target segments chosen, it is easily for Biopure to expand the sales with Oxyglobin within a year. Besides, Biopure is the only company in the veterinary blood substitute market right now, which is a major advantage in terms of fostering customer awareness, penetrating the market and generating positive press. Further, it is an opportunity for Biopure to generate revenue that can support their continuous operation.