...Eli Lilly: Developing Cymbalta Student: AMBA 650 University of Maryland University College January 31, 2012 Professor: Eli Lilly and company is a pharmaceutical company that has been in business since 1876. In 2000 their new antidepressant team (NAT) was tasked with identifying a suitable replacement for Prozac their most profitable antidepressant drug. Prozac’s patent was due to expire in December of 2003. The expiration of Prozac’s patent would allow other pharmaceutical companies to market their generic version of the drug at a lower price. There are four members of the members of the NAT John Kaiser the marketing director at Eli Lilly, Mark Demitrack a psychiatrist and co-leader of NAT, Brett Schmidli a project development expert and co-leader of NAT, and Jim Lancanster the Prozac expert. The NAT was tasked with discussing and evaluating what drug could be developed to elevate depression in its patients and serve as the predecessor to Prozac. The NAT begin its evaluation by focusing on Eli Lilly’s five assets. The five assets were drug products that could be developed into the predecessor. The NAT decided to conduct research on the five assets to determine, which one could be developed into its next flagship depression drug. Asset 1 is R-fluoxetine, which Eli Lilly entered into a licensing agreement with Sepracor to further develop and market this drug but clinical trial stopped due to patient inability to stomach the drug. Asset...
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...Eli Lilly: Developing Cymbalta Study AMBA 650 University of Maryland University College (UMUC) Professor: Dr. Minkus-Mckenna Brian Natoli October 31, 2010 TABLE OF CONTENTS 5.0 Strategy5 6.0 Alternative Actions6 7.0 Recommendations7 8.0 Conclusion8 5.0 Strategy Based on the strengths, weaknesses, opportunities, and threats, the following strategies should be adopted by Lilly: 1. Taking advantage of its positive brand image can present advantages in obtaining opportunities that exist in their market. This will help Lilly broadening its portfolio. 2. Their long presence in the market and being one of the oldest companies in the pharmaceutical industry will be very positive for the company to obtain alliances for faster growth, better brand recognition, and to meet market’s competitive forces. 6.0 Alternative Actions: For the resolution of the lowered sales volume and the firm's shared market, there are three suggested alternative course of actions. Lilly’s first alternative includes the launching of new products with required features, such as pain relief, and one time dosage, however, capital consumption would be required for the production process, time and labor for marketing of new products would need longer lead times, and clinical trials would be required which create additional expenses for the Lilly. The next alternative for the company is to conduct preliminary market research. The customers' response for the existing drugs as well for...
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...Cymbalta Case Study Analysis Executive Summary Introduction: The Problem It’s April 2000 at Eli Lilly and Company where their flagship product Prozac is the leading brand of anti-depression medication and is set to expire in December 2003. Even though that is the official patent expiration date, no one within the company could be sure exactly how much time Prozac had left (Okef & Laufner, p.1). Patent expiration would mean that generic versions of the drug would flood the market and Prozac’s current $2 billion in annual sales would create a huge revenue gap (Okef & Laufner, p.1). John Kaiser, Marketing Director at Lilly is asked to give a presentation on a topic developing a successor to the now legendary anti depressant Prozac, which later on Kaiser titled “No Pain, No Gain.” He presented an overview of what depression is exactly and analyzed the effectiveness of Cymbalta comparing it to Prozac. After a four-and-a-half long marathon, some challenges and concerns were raised by some of the senior leaders of Lilly about their doubts that Cymbalta could in fact replace the leading brand. Strategic Planning In 1998, the New Antidepressant Team (NAT) was formed by two colleagues at Lilly: Mark Demitrack and Brett Schmidli, and later asked two other members Jim Lancaster and John Kaiser to join them based on their professional experience. The mission of the team was to find and develop a drug that would later replace Prozac. They quickly and efficiently narrowed...
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...Cymbalta case Analysis Mohamed A. Kamara AMBA 650: Marketing Management and Innovation January 22, 2013 Table of Contents 1.0. Identification of the strategic issues and problems. 2.0. Analysis and evaluation. 3.2. Recommendations. 1.0. Identification of the strategic issues and problems. In April 2000, Eli Lilly’s New Antidepressant Team (NAT) convenes to review the potentials of alternative medications, and to subsequently adopt a replacement to the company’s premier antidepressant drug, Prozac, a form of fluoxetine molecule (Ofek & Laufer, 2008). Prozac’s huge market success after its market entry in 1988, these authors argue, is predicated on its ability to produce fewer side effects that resulted from targeted serotonin uptake; its tolerance to overdose; and, of course, its efficacy. However, Prozac’s success, with revenues of $2 billion a year, is without challenges. First, Prozac’s patent term expires in less than three years [in 2003], a patent already challenged by competitor, Barr Laboratories. In addition, the field of drugs that comprises Prozac has become crowded with available substitutes, such as Paxil, Zoloft, and Celexa, to name three. Also the market introduction of a much cheaper generic fluoxetine was imminent (Ofek & Laufer, 2008). The NAT’s task is to formulate a pre-mortem strategy for the highly profitable Prozac, specifically to find a replacement in Cymbalta. Cymbalta, the front runner among Prozac’s successors, bore encouraging...
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...generic competition. The goal for the Viagra post-patent expiration Strategic Pricing Plan is to maximize profit as long as possible. This report will provide an overview of our past and current state, and arrive at our proposed pricing strategy plan in which we will achieve the best outcome. ZOLOFT (ANTI-DEPRESSION DRUG) CASE EXAMPLE: PRICE ELASTICITY OF DEMAND In our efforts to predict what will happen to Viagra once our patent expires, we reviewed another Pfizer’s drug, Zoloft, as a case example. Zoloft was the leading antidepressant drug that brought in $3.3 billion in sales before its patent expired on June 30, 2006. It faced branded competition from Effexor XR from Wyeth, Paxil and Welbutrin XL from GlaxoSmithKline, and Cymbalta from Eli Lilly & Co. The demand for Zoloft was inelastic before patent expiration which allowed Pfizer to set a high price for the drug. Demand then became elastic when generics entered the market post-patent expiration. The below graphs display this change in demand elasticity for Zoloft. We expect this will be the same for Viagra. PAST AND CURRENT STATE OF VIAGRA The current market for ED drugs includes three patented brand drugs: Viagra (Pfizer),...
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...400-mile journey that would lead across the Atlantic Ocean and more than halfway back again, to a grassy industrial park in Dublin, a glass skyscraper in Amsterdam and a law office in Bermuda surrounded by palm trees. While Forest Laboratories Inc., the medicine’s maker, sells Lexapro only in the U.S., the voyage ensures most of its profits aren’t taxed there -- and they face little tax anywhere else. Forest cut its U.S. tax bill by more than a third last year with a technique known as transfer pricing, a method that carves an estimated $60 billion a year from the U.S. Treasury as it combines tax planning and alchemy. (See an interactive graphic on Forest’s tax strategy here.) Transfer pricing lets companies such as Forest, Oracle Corp., Eli Lilly & Co. and Pfizer Inc., legally avoid some income taxes by converting sales in one country to profits in another -- on paper only, and often in places where they have few employees or actual sales. After an economic bailout in which the U.S. government lent, spent or guaranteed as much as $12.8 trillion, the Obama administration faces a projected budget deficit of $1.5 trillion this year. In February, the administration said it would target some of the techniques companies use to shift profits offshore -- part of a package intended to raise $12 billion a year over the coming decade. That’s only about a fifth of the $60 billion in annual U.S. tax revenue lost to...
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