I am almost done with my third year of my PhD program. Even though I am done with my courses, I decided to take a class titled “Entrepreneurship For Scientists”, which is a seminar style where every week a speaker (entrepreneur, CEO, or industry leader) comes in to present. As part of the class, we had to work in groups of 4 throughout the semester and write a business plan for a company that revolves around a science-based innovation.
My group decided to design a genetic test that would identify an individual’s risk of developing heart disease. We worked hard throughout the semester to research the validity of the science, but mainly focusing on the market research, the technologies we would use, and how the process would work. According to our conservative projections, in year 5, we would be generating a profit of $25M.
We gave a 15 minute talk on Wednesday (May 2nd) to an audience of business leaders, VCs, and angels. It was very well received. Even though it was an academic exercise, our group is toying with the idea of launching.
Anyway, the day after our presentation (Thursday, May 3rd), Brian Williams in the NBC Nightly News reports that scientists have discovered a DNA mutation that can predispose individuals of a higher risk of heart attacks. In addition, there was an article published in MSNBC.com, which indicates that a company are pursuing developing a test that identifies people risk of heart disease.
While at first, I thought that we got “scooped” – I began to think back to our presentation, particularly the part where we mentioned that we welcome competition. Since this is a huge market, another company that would be raising awareness for our market is definitely a good thing. It can be of particular benefit if the competition is well-established, because the smaller company can piggy-back on the wave of marketing and raised awareness that the established company generates. On the other hand, it may become detrimental, since the established company can outdo the smaller company at everything they try to excel. There is a fine and strategic line that needs to be planned to capitalize on the efforts done by the established company, without arousing their “threat sensors”.
Our goal, if we launch, then is to excel and beat our competition by either the quality of our test and process, cost, or a combination, so we would gain a larger market share. Indeed, the price we set for our kit is much lower than our competition, and our test is more scientifically robust.
Now, the $25 million question is… Should We Launch?
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