15.363/HST.971  Strategic Decision Making in the Biomedical Business

Hi All,

There seems to be a fair amount of confusion as to what exactly is due for the final project over the next week.  For clarification:

• For tomorrow there are NO written deliverables due.  There is no formal write up required for the Clinical Trial Design, although a decision model must be in place in order to conduct effective negotiations during class.
• For May 13 the only item due is a short document (2-4 pages) describing your team's position and decision model (clinical programs, endpoints, number of centers and financing strategy) through the negotiations, your assumptions and how those changed as a function of the interaction with other teams.  We are especially interested in learning how you came up with your particular clinical strategy (number of molecules, number of centers, endpoints) based on the specific point of view you chose to represent, and how it changed due to the negotiations with other teams. 

All teams have at this point turned in the memo covering the financing of Octagon Pharmaceuticals and have received the background for Clinical Trials and Negotiations. 

During class tomorrow each group will have 90 minutes to finish negotiations (from 5:30 to 7:00 p.m.).  During that time you must reach agreement with all the teams in your group.   You will all have to agree on a financing strategy (deal size, pre-money valuation, ownership) and a plan of action for the clinical trials of all four molecules.  I hope you all followed our advice and started those negotiations early.  I know at least one group who did and found out how hard it was to get alignment, so if you're hoping to get it done tomorrow in class you may be in for a tough 90 minutes!

At 7:00 p.m. we will re-convene at the classroom and we will collect from each group the following information:

• Decision to move IB-2 and/or OCT-1 into Phase I (yes or no)
• Decision to move IB-1 and/or OCT-2 into Phase II (yes or no)
• Endpoints, number of centers and enrollment for each trial will obviously play a part in the negotiations as these parameters will determine the size of the round.
• Financing structure (size of the investment, investment parties, pre-money valuation, ownership)
• Partnering strategy with Ely

In parallel, we will have dinner and run a simulation to determine the outcome of each clinical trial.

From 7:15 to 8:00 groups will again break out and now negotiate the future for Octagon based on teh results form the clinical trials.  Again, clinical, financing and partnering strategies must be agreed upon.

Finally, from 8:00 to 8:30 one person from each group will describe to the rest of the class the outcome of their negotiations and clinical programs.

Again, if you have any questions at all, do not hesitate to contact Mike or me.

Andrey