Medmira laboratories the u.s. otc decision free essay sample

1. WHAT CHANGES IN THE ENVIRONMENT MADE IT POSSIBLE TO CONSIDER THE LAUNCH OF AN OTC AIDS TEST? BE SPECIFIC. MedMira felt relevant changes in the environment that increased the viability of launching an OTC Aids test. Firstly there was advances made in anti-retroviral treatments that led people to stop facing the disease as a death sentence and consider it instead as a manageable chronic illness. Such change in behavior is the reflect of a fearless society concerning HIV. The evolution of the society lifestyle and mentality, driven by the increase of information flows, allowed the disease to become more socially accepted. These changes in therapy and awareness represent an open door for at-home private tests, and an opportunity in the market for MedMira. Secondly the HIV/AIDS is a growing global concern. According to the reports of the Joint United Nations Programme on HIV/AIDS (UNAIDS) and the World Health Organization (WHO) in 2005 its estimated that there were 40. We will write a custom essay sample on Medmira laboratories: the u.s. otc decision or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page 3 Million people living worldwide with HIV; one year before 2005 there were 4. 1 Million infections and 3. 1 Million deaths from HIV; and in the US between 2000-2005 there were reported 40. 000 new HIV cases each year. These numbers reflects an opportunity for MedMira to provide its fast and accurate tests, aiming to reduce the rates of infections. Lastly the fact that MedMira products provide rapid and accurate results, which is extremely important nowadays to prevent spreading. It delivers results in a very short time which makes it suitable to this market. In addition MedMira has several credentials and a high reputation among hospitals, universities, health associations, doctors opinions and research institutes, which leads to a certain market quality that might impress private customers. It is also important to mention that at the time the decision was about to be made the legal approval was already set, therefore MedMira was able to distribute rapid HIV tests in the US, Canada, China and European Union. Additionally the possibility of a partnership with Home Access would definitely fulfill many of the challenges and gaps faced by MedMira, that is a partnership working as insurance for some of the risks related to the launch of an OTC Aids Test. 2. SHOULD MEDMIRA ENTER THE U. S. OTC MARKET? PROS AND CONS OF ALTERNATIVES. WHAT WOULD YOU DO? In my opinion I think that MedMira should enter the US OTC market because I believe that the pros are more valuable than the cons. It is a fact that are issues attached with such movement that generate uncertainty, so it will require a knowledgeable manager decision. It is also important to mention that I defend an entrance in the US OTC market along with a partnership with Access Health Corporation. On the pros side an entrance to the U. S. OTC market has the potential and viability to allow the commercialization of OTC sales of other infectious diseases. This possibility will benefit from the trend of the private customer that is to purchase different diseases tests, and may develop MedMira tests with current technology. So even if the market for HIV tests is potentially small, the others markets combined could worth billions. Not entering the market has an huge opportunity cost in case the decision ends up disapproved by the shareholders. Another valuable factor that might contribute to a well succeed entrance is the low and powerless competition. MedMira was the current overall market leader selling 500. 000 tests per year, and OraSure Technologies followed close behind selling 400. 000 tests per year, but the company was facing some problems regarding the oral fluid formula procedures. All the other competitors sold less than 70. 000 tests per year. On the downside of this decision is that the majority of the companys tests have been sold to hospitals and laboratories, so US OTC sales would require to build and invest in new distribution and marketing channels (cost estimations from $10M to $15M) which were new fields to explore and lacking of expertise. Another relevant situation is the required initial investment cost of filing for MiraCare was $1. 5M; which was expensive for such a small company with accumulated losses. The cannibalization of the demand for HIV and other diseases tests to hospital and other institutional medical services by the demand for at-home private tests is also a risk to take into consideration that could affect negatively the margins of MedMira. Ethical concerns surrounding at-home testing and clients assistance and orientation were two typical issues that MedMira would have to face if entered the OTC market without Access Health Corporation, otherwise MedMira will shrink a bit its margins in exchange for the partnership but it will guarantee the only FDA approved at-home test system on market, and an easy resolution for those concerns.