Viyon Kuton
Global Marketing
Individual Case: Final Case
Questions – Answers

Metabical: Pricing, Packaging, and Demand Forecasting for a New Weight-Loss Drug.
1. How does Metabical compare to current weight-loss options?

When you look at the current weight loss options, one would see that upon approval, Metabical would be the only prescription drug for weight loss approved by the FDA. Compared to other drugs that offer weight loss, Metabical has fewer side effects and since Metabical combines an appetite suppressant and fat-blocking effects in a multi layer pill, it creates a market that targets obese people and addresses their weight loss needs. Metabical also works in low dosage so its side effects are very minimal. It’s very well known that prescription drugs often come with side effects, however Metabical does an excellent job minimizing that. It has almost no side effect and that makes for a great selling point when compared to the other options. If you look at the side effects listed for some of Metabical competitions, long-term side effects include liver failure and gallbladder disease. These side effects can prove to be fatal. Compared to the other weight loss option drugs offered, Metabical is not only safe but it is effective.

2. What are the pros and cons of the forecasting methods presented by Printup? If you had to estimate demand for this product, how would you go about it? What would your demand (unit) forecast look like for the first five years?

Pros: Considers the whole population of the United States, it targets a populations that is ready to begin using the product upon approval and use which makes data more precise.
Cons: Not all the data from the survey is being used, this makes it harder to estimate the amount of people actually willing to trust and use the drug, since number for drug use is coming from a survey sample, data can be inaccurate, thus narrowing down the market.

Demand Forecast
Year
US Adult Pop
BMI
Comfortable taking pills.
%
Market Share
%
Dem retention
Repurchase
2nd Supply
%
1
209,000,000
35%
73,150,000
15%
10,972,000
10%
1,097,250
658,350
20%
2
209,000,000
35%
73,150,000
15%
10,972,000
15%
1,645,875
987,525
20%
3
209,000,000
35%
73,150,000
15%
10,972,000
20%
2,194,500
1,316,700
20%
4
209,000,000
35%
73,150,000
15%
10,972,000
25%
2,743,125
1,645,875
20%
5
209,000,000
35%
73,150,000
15%
10,972,000
30%
3,291,750
1,975,050
20%

3. What considerations should be taken into account when making decisions about the package count? What package size would you recommend?
Considerations one should take into account when it comes to the amount to have in the package count includes the amount a consumer needs to use in order for the drug to work. Seeing that Metabical takes about 12 weeks to see results, perhaps a weekly basis package count will be optimal. You can have a seven-day a week package count for each day, which will make it easy to keep track of usage. However, since insurance doesn’t cover this, this can be the more expensive choice especially for the target demographic whose income level is less than $60,000. I would recommend the weekly package. CSP should make it so that the consumers can purchase 3 packages that has 4 weeks of the pills. This is a less expensive choice and will also ensure that the consumers do not run out of the pills. This option also allows for CSP to sell more pills since their consumers would have to buy in bulk.

4. What pricing strategy approaches would you suggest Printup explores? What are the advantages and disadvantages of each strategy? What price would you recommend?

Pricing Strategy 1: Use Alli’s price as a benchmark and sell a 4-week supply for $75.
Advantage: Low price will make it easier to attract customers.
Disadvantage: Pricing a superior product so low will hurt