Advice You - Business

Pricing is undoubtedly one of the most important decision areas of manufacturing performance manage

According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product

ment. Price and sales volume together decide the revenue of any business. As the sales volume in it

; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.

Examples of combination products may in

self is dependent on price, pricing really becomes the key to the revenue of the business. Pricing

lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.

s crucial to profits as well.

Stated simply, price is the exchange value of a product. In fact, pr

here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe

ice revolves around two elements- utility and value. Utility is the generic property of the product

d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.

Combination pro

to satisfy a need or want of the customer. Value is the quantitative worth the consumer attaches to

ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc

the product, for which he is willing to part with a certain quantum of money.

Two categories of f

easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi

actors - internal factors and external factors - influence the pricing decisions of any enterprise.

nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically

In each of these categories some may be economic factors and some psychological factors; again some

and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ

factors may be quantitative and yet others qualitative. The firm has certain objectives- long term

ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi

as well as immediate- in pricing. For example, it has certain costs of manufacturing and marketing;

ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.

Following aspects would a

and it seeks to recover these costs through the price.

The firm may have a basic philosophy on pr

dd to the challenges in developing combination products:

Which markets to tap where the combination products can do fairly well?
Which combination prod

icing. The pricing decisions of the firm have to be consistent with his philosophy. Pricing also ha

cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin

to be consistent with the overall objectives of the firm. The firm is also seeking a particular pu

tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen

blic image though its pricing policies. All these constitute the internal factors that influence pr

t?

As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel

cing. Moreover, pricing strategy has to fit into the overall marketing strategy. It cannot exist in

ping new procedures for reviewing their safety, efficacy and quality.

Professional from academic institutions, pharmaceutical industries, health care indust

terdependently.

In addition, any business firm has to encounter a set of external factors while fo

y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products

rmulating its pricing strategy. In the first place, the nature of the economy and the nature of com

.

As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de

etition have to be reckoned with. The purchasing power of consumers has also to be reckoned with. T

elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.

Companies that provide selfless information through particip

he bargaining power of major customer groups and supplier groups is another important consideration

tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products

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The fact is that enhanced energy, success and performance cannot be found in a bottle or can of espresso and we cannot replace sleep with a cup of coffee. Just as the world must find alternative sources of energy to oil it's clear that Corporate America must look to alternative sources of energy besides coffee to power its workforce. Instead of energy drainers American businesses must focus on becoming power generators.

It used to be the case that auction sales came to a juddering halt with the onset of the summer social season and the school holidays. June typically represented the peak of activity with flagship sales at the major houses, accompanied by the serious business of sports spectating. You may have noticed that the Open Golf has just begun as has another Test series. Ascot, Henley and Wimbledon have been and gone as has the small matter of the World Cup. It can be difficult to find the time to attend to any business when confronted by the demands of wall to wall sporting coverage, alcoholic intake and cloudless skies.

If you're about to start a business (or approach a financial institution for funding to expand your existing business), then you must have a business plan. Your plan allows you to set your goals, assess your strengths and address your weaknesses.

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Advice You - Manufacturing Performance Management

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