Medi-Cult Case: In Vitro Fertility

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Medi-Cult Case Analysis Medi-Cult, a biotech company based in Denmark, has developed a new alternative to In Vitro Fertilization (IVF) called In Vitro Maturation (IVM). These methods are used to help infertile couples have children. IVM significantly reduces the time needed to mature an egg from 30 days to just 2 days. Importantly, it is a relatively hormone-free treatment thus sparing women a number of psychological and physical side effects. Because the side-effects tend to be much-lessened, women at risk from hormone-related condition such as polycystic ovaries are offered the option of safer fertility treatment. 1 What are the sources of economic value for IVM vs. IVF Economic value (or reservation price) is the maximum amount a customer…show more content…
Medi-Cult may reduce prices at this time to remain competitive, or may hold prices and rely on customer loyalty with guaranteed quality for the product. 4 Competitive Rivalry: The market is open for Medi-Cult for an expected 2-3 years, but the large pharmaceutical companies and other companies similar to Medi-Cult could see an opportunity to mass-produce for a cheaper amount and enter the market. 5 Buyer Power: Consumer value is high for this product for the above reasons shown when comparing IVM to IVF. Therefore, the price could be set higher than the IVF medium because profit would still be made by the clinics through reduction in treatment costs. IVM Price In conclusion, I would expect Medi-Cult to adopt a skimming strategy for the period of advantage and charge in the region of $1000 compared with $50 for the IVF culture. There is a strong price-perceived quality relationship resulting in positioning at the higher end of pricing. (Winer, 2011). The value to clinics is much higher than IVF due to the reduced resource cost. This would result in a cost of $6,100. The overall cost is still lower than IVF, therefore through price elasticity of demand, I would expect more visitors to the clinic than previously to take advantage of this new

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