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YGCC Life Sciences Case Book

2014
Yale Graduate Student Consulting Club
Preview Version
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Table of Contents
Case # Title Firm Type
1 CS Med Health Advances Commercialization
2 Ear X Health Advances Commercialization
3 NeoFactor Trinity Partners Market Entry
4 LT Neuro Trinity Partners Market Entry
5 O Care Trinity Partners Acquisition
6 Ultimate Bandage Trinity Partners Market Entry
7 C Difficile Vaccine ClearView Pricing
8 IBD Products ClearView Market Size Estimation
9 Boreal L.E.K. Profitability
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Estimation Practice
Estimation Prompts
To help with your preparation, below are a collection of prompts used from previous
interviews or based on similar interview questions

Before starting, you should take a look at various outside resources to guide your approach

Some suggestions are:

Case Interview Secrets by Victor Cheng (Amazon)
Guesstimation by Lawrence Weinstein (Amazon)
Framework for McKinsey, BCG and Bain estimation cases (Youtube)
Estimation podcasts (Firmsconsulting website)



Example Estimation Questions:
How many HPLCs are sold annually?
How many PCR machines are sold annually?
What is the amount of floss used in America?
How many new braces (teeth) are installed per year?
How many new glasses are prescribed per year?
How much contact solution is sold every year in America?

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Case 4: LT Neuro (Multiple Sclerosis)
What factors should be considered?
Sample Issue Tree
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Launch oral drug for treating MS?
Market
Size Trends Share
Competition
Profitability
Revenue
Volume
Treatment
Frequency
Price
Costs
Fixed Costs
Clinical
Trials
Variable
Costs
Costs / unit
# treatment
sold
Implementation Risk
Capital Operational
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Case 5: O Care (Orphan Drug)
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Type of Case Firm
Acquisition Trinity Partners
Prompt
Our client wants to acquire OCare (OC), a small biotech company. Most of OCs products are in
development in the preclinical phase, but OC does have a single revenue stream. This revenue is
from sales of OC1, the only FDA approved orphan drug to treat Disease X. Disease X is an inherited
disease that affects 1/20000 among children at the age of 9 and younger. Negotiations with OC have
led to a price of $60M. The client hires you to access whether they should acquire OC or not.
Additional Information (provided on request)
Client Goal (Interviewer should emphasize this)
- The board will approve the deal only if the acquisition can breakeven in 5 years.
OC Business Model:
- OC develops orphan drugs in house, but OC1 is the sole revenue stream. Other preclinical drugs
can be considered mainly R&D cost within the 5 years.
- Contracts with a third party for OC1 manufacturing and distribution/sales/marketing.
Client Business Model:
- Develops several classes of pharmaceuticals in house, but wants to expand to orphan drugs.
Manufactures all drugs in house. Same external distribution/sales/marketing channels as OC.
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Case 5: O Care (Orphan Drug)
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0%
5%
10%
15%
20%
25%
30%
35%
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45%
25 30 35 40 45 50
M
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Price/patient/year
(in 000 dollars)
Exhibit 2: Price Sensitivity Exhibit 1: Profitability Comparison
15% 15%
25%
5%
30%
15%
30%
65%
0%
10%
20%
30%
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100%
OC
Finance
Structure
Client
Finance
Structure
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Net Profit
Distribution
Production
R&D
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Healthcare is a rapidly developing sector of the global economy. This glossary serves as a starting point with a
collection of terms to make the cases more approachable.

However, it must be noted that during an actual interview, be cautious with the terms you use unless you fully
understand them. The YGCC are not experts in this field so the terms contained within this glossary are simplified
definitions. We highly recommend further research on your part should you decide to engage in this industry.


Pharmaceuticals the umbrella term for substances that have a biological effect to manage or treat a disease
Small molecules chemically derived pharmaceuticals that are generally much smaller and less complex than
biologics
Biopharmaceutical / Biologic biologically derived pharmaceuticals. Biologics are generally more complex than
small molecule pharmaceutics. Examples include recombinant insulin (diabetes), interferon (HCV), and antibodies
(commonly used for specifically targeting cancer).
Medical Devices Devices used for a therapeutic use. The most easily recognizable are pacemakers (control
cardiac rhythms)

Clinical Trials Process FDA based approval process that pharmaceuticals must pass through before being
sold to the general. There are many more caveats to explore so visit the FDA website for detailed information
1) IND Investigational New Drug. Before entering the clinical trial process, a company must file an application
that contains chemical analysis of the pharmaceutical and usually safety tests in animal subjects
2) Phase I Generally the first studies in humans to test safety
3) Phase II Larger scale trial for safety in a target population and efficacy
4) Phase III Larger scale trial to test safety and efficacy
5) NDA New Drug Application. Once the clinical trial process is complete, the company files an NDA to ask the
FDA for approval. If approved, the drug can enter the market
Glossary of Terms
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Additional Life Sciences Cases
McKinsey & Company
Title Source Case #
Magna Health McKinsey Website NA
Suger Magnolia Hospital Columbia 2006 5
Heartcorp Columbia 2006 10
Meditest Columbia 2006 15
Health Care in Canada Columbia 2007 7
Vitamin Manufacturer Entry into China Kellogg 2001 36
Old Pharma London 2013 NA
Apollo Medical Labs McCombs 2007 2
APC Nutrition McCombs 2008 7
US Healthcare Michigan 2005 5
Pharma Acquisition Michigan 2008 12
Medical Device Ross 2005 43
Diabetes Testing Ross 2007 17
Drug Store Profitability Ross 2007 18
Pharma Acquisition Ross 2008 12
Universal Healthcare Sloan 2011 52
Nutracorp Wharton 2005 5
Mini Case 1 YGCC 2012 23