Objective

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To assess the commercial potential of a new drug product by forecasting its market performance and calculating its NPV, which measures the expected profitability and viability of the investment utilising our AI platform.

Methodology

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1. Market Research:

• Conduct a comprehensive market analysis to estimate the target patient population, market size, and unmet needs.
• Analyse competition, current treatment options, pricing, and market trends.

2. Drug Product Forecasting:

• Revenue Projections: Project revenues over the product’s lifecycle, considering factors like market penetration rates, adoption curves, pricing strategies, competitive landscape, market exclusivity and patent expiration.

3. Cost Analysis:

• Development Costs: Include clinical trial costs, regulatory expenses, and other R&D investments.
• Manufacturing Costs: Assess costs of production, packaging, and distribution.
• Marketing and Sales Expenses: Estimate costs of promotional activities, sales force, and market access strategies.

4. NPV Assessment:

• Cash Flow Projections: Calculate expected cash inflows (revenues) and outflows (costs) over the product’s lifecycle.
• Discount Rate: Select an appropriate discount rate reflecting the risk associated with the project.
• NPV Calculation: Use the discount rate to calculate the NPV of the projected cash flows, which represents the current value of the drug’s future earnings.

Outcomes / Impact

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• Go/No-Go Decision: Informed decision-making on whether to proceed with drug development or market launch.
• Investment Justification: Clear financial justification for investments in R&D, marketing, and sales.
• Strategic Planning: Detailed understanding of market potential to guide strategic planning and resource allocation.