Glenmark Generics Inc: Launch @ Risk Harvard Case Solution & Analysis

Glenmark Generics Inc: Launch @ Risk Case Solution

Problem Diagnosis

The vice president of Glenmark Generics Inc, Vijay Soni, was facing a dilemma in the June 2010 and he needed to make a recommendation to the CEO of the company regarding the risks and the potential uncertainty surrounding the launch of one of the pharmaceutical drugs in the US market. Glenmark Generics is basically a subsidiary of the parent company called Glenmark Pharmaceutical Company limited.
This launch is basically known to be called as launch at risk in the US market because this launch was surrounded by outstanding lawsuits against it and if the situation turns against the company, then serious litigation costs will have to be paid by the management of the company. Glenmark Generics Inc is about to launch a generic version of the patented drug called Tarka, which is set to expire in the February of 2015.
The final ruling of the court in New Jersey is still under way as the application for gaining the approval for this drug from ANDA had been denied by the Judge Dennis M. Cavanaugh and this had been on the request of the patent holder. Now a decision needs to be made by the management of Glenmark Generics and the executive vice president needs to consider the range of the options available to minimize the risk associated with this Launch @ Risk. A detailed analysis has been performed qualitatively and quantitatively to make the final recommendation to the CEO of the company.

Analysis

The drug which has been created by Glenmark Generics Inc is basically a generic drug and it would be cost effective for the customers to buy this drug which will have the same inputs and components as of the branded drugs. Moreover, the cost of the drug would also be lower as compared to the cost that is set by Abbot.
The price which is currently being charged by Abbott is $ 3 per capsule, whereas the price that would be charged by Glenmark Generics Inc would be around $ 2.1 per capsule. However, the main advantage with the company would be a surge in the demand of the company and the research and development costs along with the costs of manufacturing this drug would be very lower for Glenmark Generics Inc.
Therefore, this is the reason that they would be able to make a gross margin of about 90% as compared to the gross margin of Abbot which on average would be 60% only.Analysis of all the choices available to the executive vice president of Glenmark Generics Inc has been performed based on qualitative logic and quantitative numbers derived from the case. First of all, all the choices available to the management of Glenmark Generics Inc associated with Launch @ Risk have been discussed in the next section..........................

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