Medmira Laboratories' U.S. over-the-counter market entry strategy

Medmira Laboratories - International Marketing Analysis

In 2005 it was stated in an 'immediate release' report entitled: "MedMira to Commercialize Revolutionary New Diagnostic Technology Platform" that Medmira, Inc. "the global leader in premium rapid diagnostic solutions announced today that it has acquired SensorChem International Corp. based in Toronto in order to bring a revolutionary, new biosensor technology platform to international diagnostic markets." (Immediate Release, 2005) This would operate under the title 'Project Maple' according to the report. The products and services as well as applications that were acquired in this purchase will serve to "complement Medmira's current product portfolio stated to be consisted of "rapid flow through point-of-care tests for HIV, Hepatitis C, and other infectious diseases." (Immediate Release, 2005)

THE PROBLEM

The problem addressed in this case study is whether Medmira should an over-the-counter market (OTC) either:

1) Alone;

2) Through a partnership with a competitor; or 3) Not at all,

And specifically in the United States over -- the counter market in the United States represents only merely 8% of the total U.S. sales of this company's products and services.

METHODOLOGY

The methodology of this study is qualitative in nature and one, which is conducted through a review of literature in this area of study.

CASE FACTS

I. Identification of 'Regulatory' Issues

The work of Sagebien and Whellams which is a case study entitled: "Medmira Laboratories: The U.S. OTC Design" (2006) relates a case scenario in which an individual who was building "a solid distribution network for Medmira Laboratories' and read an article concerning the FDA in relation to their consideration of OTC home testing for AIDS Virus and began to conceive how Medmira Laboratories might..."capitalize on this opportunity." (Sagebien and Whellams, 2006) While the largest part of the company's products and services had been non-over-the-counter (OTC) products this report acknowledges that should OTC testing be approved by the FDA that an entire new sector of the market in healthcare products and services would result and this included OTC at-home rapid diagnostic test kits for various illnesses and conditions. It would not be very easy for these new products to procure space on the shelf in pharmacies was also acknowledged.

II. The Ethical Debate (Home and OTC Sales of HIV Tests)

The debate, which is reported to have ensued concerning home and OTC sales of HIV tests, includes the following arguments:

1) Proponents argued that in 1987 when home sample collection was first proposed that little treatment existed for those who had acquired the HIV virus and that positive results on these tests "mean an immediate death sentence" however, with more advanced treatment this disease has become easier to treat.

2) it was argued that this type of home testing would further the goals in decreasing the rate of infection because faster more accessible and more confidential testing would cause people to test earlier resulting in a reduced rate of transmission of the disease.

3) There is hesitancy to endorse OCT testing for the HIV virus due to the lack of social support missing from this type of testing.

4) Incorrect and inappropriate use of these tests are also cited as being necessary for consideration.

5) Forced testing of individuals was also noted as a potential problem related to OTC HIV testing.

6) Concern with OTC HIV home testing was also noted in the area of public health officials tracking and reporting of the rate of the HIV infection.

III. Financial Considerations

Other considerations of Medmira Laboratories include the following financial considerations;

FDA Market Pre-Approval Costs of U.S.$750,000

IV. Recognition of Opportunity

Because these products were likely to crowd pharmacy shelves representing 'opportunity' it was important that Medmira not make too late of a move and neither should Medmira move too quickly.

V. Competitors Identified

Competitors identified in the case study include: (1) Orasure Technologies: while this company's product was superior in a sense and this company did not possess the public's confidence in the validity of its' test results; (2) bioLytical Laboratories: This company had not been approved for OTC testing of HIV and had not made expansion internationally. Furthermore, this test was far more complicated; and (3) Home Access Health Corporation: Based in Chicago this company had already developed OTC HIV testing with a high rate of validity and public confidence had already developed in this company.

DISCUSSION and CONCLUSION

The scenario identified is one in which the entire spectrum of international marketing considerations must be undertaken in conducting an analysis of this company's products and services and entry into the international market and in this case specifically the United States OTC rapid diagnostic testing market. Regulatory issues are not a high priority for consideration for Medmira Laboratories except that FDA regulation of the OTC market had resulted in an opportunity being identified by this company. There are factors that have been considered in this study which include the ethical debate, and the financial considerations of entry into the OTC market in the U.S. It is likely that while it will cost the company a great deal of money initially to invest in the U.S. OTC rapid diagnostic testing market that should Medmira Labs partner with Home Access Health Corporation that it would likely forego the FD market pre-approval costs and the FDA market subfilings relating to the products as Home Health Access had already undergone this process with the FDA. Even though the U.S. OTC rapid diagnostic testing market is small in actuality this would open the door to the potential billions in sales of other rapid diagnostic testing including flu, strep throat, STDS, and even drug screenings. The most important consideration in this study has been that of how should Medmira enter the OCT HIV testing market in the U.S., and this work states findings that it is clear that to enter the U.S. market as partner of Home Access Health Corporation would be the optimal entry strategy for Medmira Laboratories.