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Portfolio management
A listed UK based biotechnology company was faced with major decisions over the future shape of its development portfolio—which products should be given priority and which should be abandoned or otherwise taken out of the company's expenditure plans.

 

 

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The company required an assessment of all projects in the pipeline and appropriate recommendations.

The objectives for the client

The client needed to gain an objective external view of the:

  • value that its individual projects represented

  • probability that the projects would survive development and realise that potential.

The client also needed to consider the way in which the selected portfolio would fit together, taking into account:

  • the resulting overall risk profile of the company

  • any technical or other synergies or conflicts between projects.

The programme of work

In the first stage the projects were all analysed individually by means of:

  • detailed discussions with R&D staff to gain an understanding of the projects

  • desk research and interviews with recognised specialists in the field to establish:

    • the projects' technical and IP robustness

    • their ability to meet future unmet medical needs

    • their market competitiveness in addressing those needs

    • possible out-licensing structures.

From these data, simulation models of each project's earning potential were created showing the product's key alternative outcomes, each associated with a probability.

In the next stage Bridgehead Consulting:

  • held a workshop with the client's senior management, exploring the ambitions of the company, to establish a set of criteria for judging projects. These covered desired risk profile and technical focus, news-flow issues, financial objectives and constraints, timing limitations etc.

  • then scored the projects against these criteria, and presented the result to a further series of management workshops where alternative portfolios were reviewed and a preferred model selected.

 

The deliverables to the client

In addition to the crucial final decision, the client received:

  • a valuation and summary IP review of each project

  • an assessment of the market and the potential licensing terms for each project

  • a review of the company's overall strategy.

 

The project achievements

The client was able to make a key decision on its development programme and to back up that decision with thought-through and externally validated arguments.

Added value

Bridgehead Consulting concentrated on gaining buy-in from all key staff both to the decision-making process and to the decision itself. This was done by tailoring the process to the specific client, and by using techniques such as simulation modelling, which takes into account a broad range of views on the merits of individual projects.

 

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Case studies-strategy and planning

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