The quantity of cancer people have been elevating at an extremely rapid charge and so have the costs to be treated. Abgenix using its mouse, XenoMouse valued at 3 billion dollars dollars by investors has a huge potential in the treatment and eradication of malignancy, based on its technology. The managers at Abgenix need to decide on if to develop and commercialize the merchandise by themselves as well as to go in for a Merger with either Pharmacol or Biopart. It is seen that the merger with Biopart proves to be a better a single as it is connected with high hazards, high returns and Abgenix currently, has a very high fluidity where it can afford to take risks. Besides the merger with Biopart, Abgenix would always utilize all their platform product namely XenoMouse for the treating other diseases.
Having raised about $600 mil dollars in its financial circular of purchases, Abgenix's CEO Scott Greer is facing the following three opportunities due to its product ABX-EGF(Epidermal Growth Factor). He may either acquire Pharmacol, a pharmaceutical firm with a substantial market increased and sales value of $12 billion. This alliance would be a total " hand-offвЂќ where-in the sole source of earnings would be a substantial royalty cost of 10% on the total sales. The other alternative that Jeff has, is the fact he can partner with Biopart, which is a biotechnology firm, focussed on oncology. This deal would be a " hand-inвЂќ deal, where-in Abgenix would have a 50-50 state in the matter and will need to share fifty percent of the expansion, Operating and Marketing costs. From this offer however , Abgenix will get a larger share from the profits(50% of sales). The next and final option which in turn Scott has, is a " go-it-aloneвЂќ approach, where he may completely dispose of the idea of a partnership. Next sections deal with each of these aforementioned scenarios and the decisions included based on all their likelihood of being profitable.
Abgenix has been traditionally licensing it is XenoMouse technology through a gamut of antibody based items such as ABX-CBL, ABX-IL8, ABX-EGF and ABX-RB2 to cure various diseases like graft versus sponsor disease, Arthritis, Cancers and Organ implant rejection. Since all the above mentioned products are derivatives of XenoMouse structured antibody generation, Abgenix can be for a industry segmentation in coming up with the best strategy for every one of its products. It should segment their markets for ABX-EGF centered drugs and also other XenoMouse structured products. Regarding the various other XenoMouse centered products it may create a system market with XenoMouse becoming the platform for companies to produce different antibodies for different antigens. Whereas to get ABX-EGF, Abgenix should consider looking at the following tactics.
The core-competency of Abgenix was, creating its own product-generating program namely " XenoMouseвЂќ which may produce the mandatory antibody to get the specific antigen. Currently, Abgenix is only working with Phase one of the total three or more Phases pertaining to ABX-EGF. FOOD AND DRUG ADMINISTRATION (FDA) approval may be received only after Period 3 becomes successful. Away of these stages, as suggested by the Key Business Expert Ray Withy, the maximum revenue would be noticed only following Phase a couple of (Refer Appendix).
If Abgenix decides to adopt their own route, вЂќgo-it-aloneвЂќ but not partner with either firm, they can have to fees double the cost in producing skills to hold the product above the different levels of product manufacturing and commercialization. This would not always be attractive as a result of following causes: As mentioned before, they can incur huge operating and marketing costs which is not in the interests in the investors, as it will hinder the schedule required to become profitable. The industry for malignancy drugs has not been a Green Ocean, together many opponents namely Herceptin, Rituxan etc . From the five force research (Refer Appendix) it is evident that HuMabMouse,...
References: #@@#@!!: Avance. " Discount Rates to get Biotech Companies. " In. p., By. 2008. Net. 2 Apr. 2015.
#@@#@!!: Abgenix as well as the XenoMouse. Distribution. Boston: Harvard Business School, 2001. Print.