QUESTION 2: The team wants to explore BioFuture’s current drug pipeline. The team decides to focus first on evaluating the value of BioFuture’s drug pipeline – both its current portfolio, as well as its ability to generate drugs on an ongoing basis. What issues should the team consider when evaluating the value of BioFuture’s existing drug pipeline?
Helpful Hints
- Ensure to mention different issues instead of immediately diving very deep into one issue. Then ask your interviewer if he/she wants to go deeper on any of them.
Reveal answer
A good answer would include the following:
Further cost of R&D until each drug is ready to be sold.
Potential value of selling each drug.
- Market size, e.g., size of patient population, pricing
- Market share, e.g., number of competitive drugs in R&D or on the market; different side effects, convenient dosing schedule (i.e., patients are prescribed to take a drug at regular intervals that are easy to remember such as once a day or every 12 hours), etc.
- Costs to manufacture and sell, e.g., marketing, distribution, etc.
- Press about these drugs, e.g., have famous doctors called for this kind of drug, is it only slightly improving on what is on the market already?
A very good answer would also include the following:
Risk level.
- Likelihood clinical trials of a drug will prove effective
- Likelihood drug will win regulatory approval
- Side effects and potential legal exposure, e.g., potential law suits due to unexpected side effects
- Emergence of substitutes – are competitors working on substitutes already? Is it about speed and does BioFuture have enough researchers working on the respective drugs?
- Strength of underlying patents, i.e., how likely is it that a competitor can successfully copy BioFuture’s drug?