Life Science Case Studies

Setting Direction in Corporate Strategy
A top-ten biopharmaceutical company with three products in the market and seven products in development appointed a new CEO who immediately launched a Corporate Strategy initiative to determine the company’s time to profitability and to develop its five-year plan. As part of this initiative, Applied Strategies was asked to work with project and management teams to analyze the company’s two therapeutic area portfolios, including alternative development plans that might speed products to market or otherwise increase revenues in the target profitability window. Using our powerful valuation methodology, we were able to:

• Assess the value of the current development plans
• Generate and assess the value of alternative development plans
• Define success criteria and assess probabilities for each alternative
• Estimate development cost for following year, to next decision milestone, and to completion
• Assess market size, share and price; competitor dynamics; commercial costs
• Identify key commercial value drivers
• Calculate value measures for each alternative and recommend a path forward

As a result of these analyses, most project teams were re-directed to pursue development plans that differed from their existing plan in order to maximize value, accelerate revenue, or minimize spend. In addition, the subsequent portfolio analysis of the selected development plans identified a significant earnings gap during the targeted profitability window and less than acceptable earnings growth over the long-range planning period. The company asked Applied Strategies to assist the company in its work to identify options for addressing the earnings gap and significantly increasing earnings growth over the next five years.

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