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Bain Medium Profitability

Take Your Pills!

#Healthcare

Practice this intermediate profitability case interview question from Bain in the Healthcare sector. Includes detailed problem prompt, clarifying questions, structured framework, and expert recommendation. Part of ProHub's 835+ consulting case library.

ProHub Comment

This is a revenue decomposition case that requires candidates to identify that despite consistent new patient acquisition, revenue per patient is declining due to low patient adherence and persistence rates. The case tests quantitative modeling skills through a campaign ROI analysis and qualitative brainstorming abilities around healthcare patient behavior factors.

Estimated Time 26 minutes
Difficulty Medium
Source NYU
45 / 100
Your client is Foci Pharmaceuticals - a leading rare disease pharmaceutical company - has seen US sales growth slow down over the past year. Your firm has been hired to determine the cause of this slow down and recommend ways to reverse the trend.

Clarifying Information

  1. No direct competitors
  2. The client is the market
  3. 100% of revenues come from just one drug, Nalparcin, which treats a rare type of muscular dystrophy (MD)
  4. Nalparcin was launched in 2017 and is classified as an orphan drug (meaning it treats a disease that afflict fewer than 200,000 people in the US)
  5. Nalparcin’s period of exclusivity (the period during which FDA will not approve a generic version of the same drug) will last through the end of 2024
  6. Only 30,000 patients in the US are eligible to receive Nalparcin
  7. The annual price of Nalparcin treatment is $500,000/patient
  8. Nalparcin has to be taken daily
Mock Interview
Interviewer

Your client is Foci Pharmaceuticals - a leading rare disease pharmaceutical company - has seen US sales growth slow down over the past year. Your firm has been hired to determine the cause of this slow down and recommend ways to reverse the trend.

You

Thanks. Before analyzing, I'd like to clarify a few key questions...

Interviewer

Good question. Let me provide some background information...

You

Based on this, I suggest analyzing from these dimensions...

AI Score
Structure Analysis Communication Business Sense Quantitative
Practicing...
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Practice this case with AI Mock Interview

Foci Pharmaceuticals, a monopolistic rare disease company selling Nalparcin at $500K/patient annually, faces slowing US sales growth despite maintaining constant new patient numbers. Through exhibits revealing 40-60% adherence and 50% persistence rates, candidates must diagnose the problem and evaluate a $300M marketing campaign to improve these metrics, potentially generating $204M in additional margin benefit.

Key Insights:

  1. Revenue per patient declining despite flat new patient acquisition signals adherence/persistence issues rather than market saturation
  2. Daily medication requirement creates high-sensitivity revenue model where each missed pill = ~$1,370/day revenue loss
  3. Campaign ROI analysis requires structured approach tracking both existing patient cohorts (higher persistence risk) and new patient cohorts separately
  4. Candidate must recognize this is a monopoly market with limited addressable population (30K eligible patients), requiring patient lifetime value optimization
  5. Solution evaluation should consider not just direct financial ROI but broader implications for patient health outcomes and competitive positioning post-2024 exclusivity expiration

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