What to do with vanatin in foreign markets

Assignment Help Operation Management
Reference no: EM131422948

Assume that it is August 1969 and that you are a member of the Booth Pharmaceutical Corporation Board of Directors. You have been called to a Special Board Meeting to discuss what should be done with the product known as "Vanatin."

Vanatin is a "fixed-ratio" antibiotic sold by prescription. That is, it contains a combination of drugs. It has been on the market for more than 13 years and has been highly successful. It now accounts for about 18 million dollars per year, which is 12 percent of Booth Company’s gross income in the United States (and a greater percentage of net profits). Profits from foreign markets, where Booth is marketed under a different name, is roughly comparable to that in the United States.

Over the past 20 years there have been numerous medical scientists (e.g., the AMA’s Council on Drugs) objecting to the sale of most fixed-ratio drugs. The argument has been that (1) there is no evidence that these fixed-ratio drugs have improved benefits over single-drugs, and (2) the possibility of detrimental side effects, including death, at least doubled. For example, these scientists have estimated that Vanatin is causing about 30 to 40 unnecessary deaths per year (i.e., deaths that could be prevented if the patients had used a substitute made by a competitor of Booth). Despite these recommendations to remove fixed-ratio drugs from the market, doctors have continued to use them. They offer a shotgun approach for the doctor who is unsure of his or her diagnosis.

Recently a National Academy of Science – National Research Council panel, a group of impartial scientists, carried out extensive research studies and recommended unanimously that the Food and Drug Administration (FDA) ban the sale of Vanatin. One of the members of the panel, Dr. Peterson of the University of Texas, was quoted by the press as saying: "There are few instances in medicine when so many experts have agreed unanimously and without reservation (about banning Vanatin)." This view was typical of comments made by other members of the panel. In fact, it was typical of comments that had been made about fixed-ratio drugs over the past 20 years. These impartial experts, then, believe that, while all drugs have some possibility of side effects, the costs associated with Vanatin far exceed the possible effects.

The special Board Meeting has arisen out of an emergency situation. The FDA has told you that it plans to ban Vanatin in the United States and wants to give Booth time for a final appeal to them. Should the ban become effective, Booth would have to stop all sales of Vanatin and attempt to remove inventories from the market. Booth has no close substitutes to Vanatin, so consumers will be switched to close substitutes currently marketed by rival firms. (Some of these substitutes apparently have no serious side effects.) It is extremely unlikely that bad publicity from this case would have any significant effect upon the long-term profits of other products made by Booth.

The Board is meeting to review and make decisions on two issues:

What should be done with Vanatin in the U.S. market (the immediate problem)?

Assuming that Vanatin is banned from the U.S. market, what should Booth do in the foreign markets? (No government action is anticipated in any of the foreign markets.)

Decisions on each of these issues must be reached at today’s meeting. The Chairman of the Board has sent out this background information, and he also wanted you to give some thought as to which of the following alternatives you would prefer for the domestic market:

Recall Vanatin immediately and destroy.

Stop production of Vanatin immediately, but allow what has been made to be sold.

Stop all advertising and promotion of Vanatin, but provide it for those doctors that request it.

Continue efforts to most effectively market Vanatin until sale is actually banned.

Continue efforts to most effectively market Vanatin and take legal, political, and other necessary actions to prevent the authorities from banning Vanatin.

A similar decision must also be made for the foreign market under the assumption that the sale was banned in the United States.

1) what to do with Vanatin in the US , why ?

2) what to do with Vanatin in foreign markets:

Reference no: EM131422948

Questions Cloud

Ethics and the green movement : Ethics and the Green Movement. Today's managers face tremendous pressure from the government and the public to hold their organizations and employees to high ethical and professional standards. Following widespread moral lapses and corporate financia..
Create an organizational structure for the business : One of the long-term goals set out by the LLB owners is to increase sales in the cowboy boot line by 15%.  Create an organizational structure for the business and the cowboy boot project. Explain why you chose the structure as opposed to others that ..
Strategy of heavy use of overtime in retailing : Many companies deal with aggregate scheduling by forcing overtime on their employees to adjust for the peaks of seasonal demand. For example, a recent The Wall Street Journal report on long and irregular hours in the U.S. highlights Angie Clark, a J...
Evaluating training important part of strategic training : Why is evaluating training an important part of strategic training? Please conduct research to support your answer, citing at least one scholarly resource in APA format.
What to do with vanatin in foreign markets : Assume that it is August 1969 and that you are a member of the Booth Pharmaceutical Corporation Board of Directors. You have been called to a Special Board Meeting to discuss what should be done with the product known as "Vanatin." A similar decision..
Rational approach as well as a strong and virtuous nature : Kant believed that one’s duty cannot benefit one’s self interest. In the example of the store owner while it seems like the owner is an ethical and dutiful person because of keeping his prices honest it is self-serving because doing so is driving bus..
Manage unincorporated dress boutique owned by wilma : Sophia is hired to manage an unincorporated dress boutique owned by Wilma. The two agree that Sophia will receive one-third of the net profits to be paid to her on a monthly basis. Is Sophia a partner? If the boutique has a loss instead of a profit, ..
Leadership play in influencing organisational behaviour : How and why are a training program and a communications system important in developing an effective ethics program? What does ethical compliance involve and how can it be measured? What role does leadership play in influencing organisational behaviou..
Ethics strategic consideration in organisational decisions : Why is business ethics a strategic consideration in organisational decisions? How do individual, organisational, and opportunity factors interact to influence ethical or unethical decisions? How do moral philosophies influence the individual factor i..

Reviews

Write a Review

Operation Management Questions & Answers

  Using the traditional-six-step risk management process

Using the traditional, six-step Risk Management Process. Identify and take five traditional risk management loss exposures through the six-step process.

  Fees for other services are to be negotiated separately

Suppose that a researcher is in discussion with a client to undertake a telephone interview survey for a particular topic. An agreement is made for the client to pay the researcher a flat $20,000 for data collection part only (fees for other services..

  Compute the priorities for each pairwise comparison matrix

Compute the priorities for each pairwise comparison matrix. Determine an overall priority for each system. Which stereo system is preferred?

  How were the values of consumer credit and debt

How were the values of consumer credit/debt and rock ‘n roll seen as threats to the traditional American way of life? Why was religion seen as an effective counter to these and other threats?

  A student team in a business statistics course wanted

A student team in a business statistics course wanted to determine if there was a difference in average download times for the three different types of computers

  Participants about the salary increase or not increase

How would the Boss inform the participants about the salary increase or not increase? Suppose a boss wants to find out whether an increase in salary will motivate his staff to work more. He took a random sample 100 employees and assigned into two gro..

  Develop a joint probability table

Develop a probability tree showing all marginal, conditional, and joint probabilities.

  What can happen if processes are built on poor planning

What can happen if processes are built on poor planning? Provide an example of a procurement process used by an organization found via the web or the CSU-Global Library. What do you like about the example?

  Briefly discuss what might be good or not so good about fact

Zack Zack Price is the CEO of Mesquite Munchies, Inc. (MMI), a group of four successful restaurants in the Southwest. One member of the MMI board of directors, Sydney Carton, has a daughter, Camille Carton, who has just started Camille's Coverings, a..

  Depict the organizations materials system

Investigate any manufacturing organization and gather information about its materials system. Prepare a flowchart, with details that depict the organizations materials system.

  Demonstrate recognition

Does a customers name need to be used to demonstrate recognition? What are powerful forms of customer recognition other than just their name? What works for you and how are you going to train your employees (customers),

  One inch margin-unjustified right margin

How Zysco uses the Balance Scorecard – 100 points possible: Length will be at least 4 pages but no more than 6 pages.. Student's name will be in the header only. No page numbers. One inch margins. Unjustified right margin.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd