Case Scenario 2: Compliance, Inc

question 41

True/False

Case Scenario 2: Compliance, Inc.
Compliance, Inc. (CI)conducts clinical human and animal trials for the pharmaceutical and biotechnology industries. Revenues are split evenly between early and late drug development services and the firm is a leader in the laboratory technologies needed for such testing. One of CI's internal quality managers, Sharon Kline, has approached the CEO with a new business proposal. She would like to see the firm take one of its in-house software programs and develop it as a leading­edge commercial product for three specific target markets-medical care providers, payers of medical care, like insurance companies, and suppliers to medical care providers, like pharmaceutical companies. The features of the software are easy to use and include electronic distribution, data harvesting, and robust reporting capabilities. With this software Sharon believes that medical care providers will be able to collect data to market to and negotiate contracts with payers or employers, profile performance of individual physicians or practice sites, identify best clinical practices, generate reports that satisfy regulatory or accreditation requirements for provider sites, and supply professional societies with data for influencing payer and government policies. Another target market, insurance companies and other medical services payers, will be able to use the software to profile performance of individual physicians or practice sites, identify best clinical practices, generate reports that satisfy regulatory or accreditation requirements, and collect data to market to and negotiate contracts with employers. Finally, the software will allow suppliers to medical care providers to assess how products perform compared to competitor products, assess outcomes in real-world compared to clinical trial settings, obtain information on provider-specific practice patterns, determine whether products are being used correctly, get "face- time" with physicians and HMOs, obtain information on product switching behavior, offer providers a value-added service, and meet FDA post-marketing surveillance requirements. CI has never launched such a product before and, even if successful, software is a very different product than the clinical trials services it provides now. The CEO must determine how to build and manage this new business for CI.
-(Refer to Case Scenario 2). Sharon Kline approached the CEO of CI with a business proposal to take an in-house software program and develop it as a leading-edge commercial product. There is some risk in the idea because CI has never launched a product before and software is a very different product than the clinical trials services the company currently offers. This new product,if successful,would be considered a radical innovation.