BIOPURE CORPORATION ? BLOOD SUSTITUTE DECISION
By: Rob Campbell, John Nicolaus, Satya Rao and Jim Zinski
Introduction:
We have reviewed the available information regarding the blood substitute market opportunities facing Biopure.
Based on this review, an analysis of the data, the likelihood of competition, the willingness of each customer to pay
for blood substitutes, the current high-profile product failures, and the desire (by the stakeholders of Biopure) to take
the company public (IPO), we recommend that Biopure go to market immediately with their animal blood substitute:
Oxyglobin. For Oxyglobin to be profitable and in the best interest of the IPO, we propose several key
recommendations and urge Biopure's management to begin steps for immediate implementation.
Recommendations:
? Pricing: Biopure should price their approved animal blood substitute at $400 per unit. Once Biopure secures
phase 3 FDA approval, they should plan to price their human blood substitute at $600 per unit.
? Market & Product Segmentation: We recommend Biopure to focus its sales efforts on the larger primary care
and emergency care practices that handle the majority of surgeries and trauma cases. These potential customers
use, by far, the most blood, and are the most likely to reap much greater revenues (and profits). For the human
blood substitute market, we recommend targeting the emergency care providers with a need for field
administration, such as ambulance providers and paramedics.
? Manufacturing Capacity: Biopure must take steps to increase its capacity pending the results of the first year
sales of Oxyglobin. Once Biopure is confident they will receive FDA approval to market a human blood
substitute, they shoul ...