Biomedical Innovation and Venture Creation: Abbott Labs in KSA

This report explores Abbott Laboratories' biomedical innovation and venture creation strategy for entering the Saudi Arabian market, focusing on diabetic diagnostic systems, cardiac monitoring, and medicinal consumables. It analyzes various business strategies, including the company's mission, passion, values, market analysis (TAM, persona), and value creation through product descriptions, problem identification, and quantified value propositions. The report also examines product unit economics using COCA and LTV, providing financial estimations for the next 5-10 years. Furthermore, it discusses product selection, promotion strategies, competitive advantages, customer acquisition methods, and overall economics, including R&D and G&A expenses, culminating in a design and build plan with key assumptions and tracking metrics. The venture formation and capitalization aspects, including stakeholder identification, roles, responsibilities, and capital needs, are also thoroughly addressed, providing a comprehensive overview of Abbott's potential venture in Saudi Arabia. Desklib provides a platform for students to access similar solved assignments and past papers.

Running head: BIOMEDICAL INNOVATION AND VENTURE CREATION
BIOMEDICAL INNOVATION & VENTURE CREATION
Name of the Student
Name of the University
Author note
Company: Abbott Laboratories

1BIOMEDICAL INNOVATION AND VENTURE CREATION
Executive Summary
The mission of this report is to examine the Biomedical Innovation and Venture creation of
one of the most renowned Biomechanical Company named Abbott Laboratory. The target
market has been chosen as Saudi Arabia. The product for the target market will be the
Diabetic diagnostic systems including cardiac monitoring and medicinal consumables. The
report examines various business strategies that include RAISON D’ETRE including Mission
Passion, Values; Market analysis including TAM, persona; VALUE CREATION including
Product Description, Problem, Quantified Value Proposition and others. Product Unit
Economics has been also analysed using COCA and LTV. The Market analysis has been
conducted while projecting the financial estimations for next 5 to 10 years as a Biomedical
Manufacturer and seller in the market of Saudi Arabia. The product selection and promotion
strategy has been also discussed in this report.

2BIOMEDICAL INNOVATION AND VENTURE CREATION
Table of Continent
1 RAISON D’ETRE...................................................................................................................6
1.1 Mission:............................................................................................................................6
1.2 Passion:............................................................................................................................6
1.3 Values:..............................................................................................................................6
1.4 Initial Assets:....................................................................................................................7
1.5 Initial Idea:.......................................................................................................................7
2 INITIAL MARKET................................................................................................................7
2.1 Beachhead Market............................................................................................................7
2.2 End User Profile...............................................................................................................8
2.3 TAM:................................................................................................................................8
2.4 Persona:............................................................................................................................8
2.5 10 Customers:...................................................................................................................9
3 VALUE CREATION............................................................................................................10
3.1 Use Case:........................................................................................................................10
3.2 Product Description:.......................................................................................................11
3.3 Problem:.........................................................................................................................12
3.4 Quantified Value Proposition:........................................................................................13
4 COMPETITIVE ADVANTAGE..........................................................................................13
4.1 Moats:.............................................................................................................................13
4.2 Core:...............................................................................................................................13
4.3 Competitive Positioning:................................................................................................14

3BIOMEDICAL INNOVATION AND VENTURE CREATION
5 CUSTOMER ACQUISITION..........................................................................................14
5.1 Decision Making Unit:...................................................................................................14
5.2 Customer Buying Process:.............................................................................................15
5.3 Windows of Opportunity:..............................................................................................16
5.4 Possible Triggers:...........................................................................................................17
5.5 Regulatory Strategy:.......................................................................................................17
5.6 Reimbursement Strategy:...............................................................................................18
6 PRODUCT UNIT ECONOMICS.........................................................................................19
6.1 Business Model:.............................................................................................................19
6.2 Pricing:...........................................................................................................................19
6.3 Short Term LTV:............................................................................................................20
6.4 Short Term COCA:........................................................................................................20
6.5 Medium Term LTV:.......................................................................................................21
6.6 Medium Term COCA:...................................................................................................21
6.7 Long Term LTV:............................................................................................................22
6.8 Long Term COCA:........................................................................................................22
7 SALES...................................................................................................................................23
7.1 Preferred Sales Channel:................................................................................................23
7.2 Sales Funnel:..................................................................................................................23
7.3 Short Term Mix:.............................................................................................................24
7.4 Medium Term Mix:........................................................................................................24

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7.5 Long Term Mix:.............................................................................................................24
8 OVERALL ECONOMICS....................................................................................................25
8.1 Estimated R&D Expenses:.............................................................................................25
8.2 Estimated G&A Expenses:.............................................................................................25
8.3 LTV/ COCA Ratio:........................................................................................................26
9 DESIGN & BUILD...............................................................................................................26
9.1 Key Assumptions:..........................................................................................................26
9.2 Assumptions Tests:........................................................................................................27
9.3 MVBP:...........................................................................................................................27
9.4 Tracking Metrics:...........................................................................................................28
10 SCALING...........................................................................................................................29
10.1 Product Plan for Beachhead Market:...........................................................................29
10.2 Next Market:................................................................................................................29
10.3 Product Plan Beyond Beachhead Market:....................................................................30
10.4 Follow-on TAM:..........................................................................................................30
11 VENTURE FORMATION.................................................................................................31
11.1 Stakeholders:................................................................................................................31
11.2 Define Roles & Responsibilities:.................................................................................31
11.3 Assign Roles & Responsibilities:.................................................................................31
11.4 Engagements:...............................................................................................................32
11.5 Corporate Filings:.........................................................................................................33

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11.6 Formation Agreements:................................................................................................33
12 CAPITALIZATION............................................................................................................33
12.1 Capital Need:................................................................................................................33
12.2 Use of Funds:...............................................................................................................34
12.3 Offering Type:..............................................................................................................35
12.4 Pre-Money Valuation:..................................................................................................36
12.5 Post-Money Valuation:................................................................................................36
12.6 Investor Profile:............................................................................................................36
12.7 Investor Persona:..........................................................................................................36
12.8 Ten Investors:...............................................................................................................37
References:...............................................................................................................................39

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1 RAISON D’ETRE
1.1 Mission:
Abbott Laboratories is an American healthcare company aimed to offering various
pharmaceutical, diagnosis and patient care products throughout the globe. The mission of this
company is to provide all the necessary and accessory medical equipments and drugs to local,
national, continental, and international market while keeping the quality of product high
along with the diversity and uniqueness (Acs et al., 2016). Currently their mission is to
expand in a new market, specifically in Middle East that can improve their potential
profitability significantly.
1.2 Passion:
Abbott is a public limited company founded in 1888 as a pharmaceutical
manufacturing and supplier company. From the 1950 the company started to expand their
expertise in different fields of biomedical such as biomechanics, diagnosis process, acute
care, and other healthcare equipments. Currently they are one of the most leading biomedical
companies in the world having revenue of more than 27.39 billion US dollar (Shammari et
al., 2016). Their systems are used for HIV care, hepatitis and cancer diagnosis, diabetic care,
heard disease and other purposes. Throughout their growth the passion of Abbot is to offer
innovative products to global market.
1.3 Values:
Abbott Laboratory has three major values which are contributing to their business
philosophy and method of expansion. These main three values are research based
development, uplifting customer satisfaction, empowering the internal strengths. The research
based product development strategy enables them to develop diverse and differentiable
products. Besides, for customer satisfaction the company considers both the immediate

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customers and end term users of their products. Along with that to empower their internal
strength Abbott always prioritises their employee satisfaction and workforce engagement.
1.4 Initial Assets:
As a multinational and ever expanding company one of the major initial assets of
Abbott is their capital, in terms of both human and financial capital. Therefore, to start-up
their new market in any new market both workforce and expendability will act as major asset.
Apart from that, they have high market reputation that acts as an asset when it comes to a
competitive market environment (Alharbi, Atkins & Stanier, 2015). In other words, the
globally recognisable brand value is their third major asset that can act as a major initial
asset.
1.5 Initial Idea:
The initial idea is to offer an innovative product or a set of products to a market from
which Abbott could generate enough profitability and potential market growth. As mentioned
earlier the initial idea is to provide healthcare diagnosis products to the target market while
capturing the maximum section of the target market. To capture a new market the company
needed chose a market where the number of biomedical manufacturer is not high as required.
2 INITIAL MARKET
2.1 Beachhead Market
Beachhead market is the market that focused on a narrowed space of market where a
business can initiate the business with higher potential benefits. Therefore, in order to expand
the business within Middle East, the company needs to set their beachhead market in a
profitable area where the competition is low and the initial or start-up expense will be
comparatively low as well (Alkhamis et al., 2017). Therefore to start business in Middle East,
Saudi Arabia will be the most profitable market for biomedical products. Because of the very

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limited number of biomedical manufacturer in Saudi Arabia the competition will be also low
for a globalised company like Abbott Laboratories.
2.2 End User Profile
Abbott manufactures various healthcare diagnoses, care giving equipments and
pharmaceutical products that makes Healthcare organisation, blood bank, medical
laboratories, health clinics, rehabilitation facilities as their direct customers. However for
Diabetic care products the end users will be the consumers of the healthcare facilities like
hospitals, health clinics, rehabilitation facilities and others. In other words, the end user for
the chosen products will be the diabetic patients, residents of rehabs and even the personal
users who want to use the self diagnosis tools (AlShammari, Jennings & Williams, 2017). In
terms of patient, cardiac and obese patients will be also included as the end user.
2.3 TAM:
TAM or Total Addressable market emphasise the total market of any business that
includes beachhead market, adjacent market and additional or extended market. Therefore, in
this case though the initial market for Abbott will be the Saudi Arabia, the adjacent market
will be the other corresponding economically developing countries such as United Arab
Imarets (UAE), Lebanon, Egypt, Turkey and others. In all those countries the rapidly
emerging healthcare service markets are experiencing the lack of biomedical manufacturers.
Therefore, as TAM the corresponding developing countries of Saudi Arabia will be
considered.
2.4 Persona:
Persona in any business industry refers a sample or example of customer profile
which is ideal and can help to develop the consumer experience planning. In case of Abbott
Laboratory and their diabetic diagnosis and care-giving products a persona will be Mr. P

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which is the procurement manager of ABC organisation. The chosen persona is presented in
tabular form as following
Background
 Supply chain and procurement manager
of the ABC healthcare organization
 Has job experience of 10 years, and 5
years as a manager in ABC healthcare
 Married and have 2 offspring
Demographics
 Male
 Age: 35-40 years
 Dual HH income: 130,000 dollards
 Suburban
Roles
 To manage the Supply chain and
purchasing operation of the ABC
healthcare organisation
 To conduct business deals with suppliers
and business partners
 To analyse the supplier availability and
market for choosing the most beneficial
suppliers
Goals
 Identifying the most beneficial supplier
for the high quality healthcare
equipments
 Increasing the profitability of the
company through having proper
equipments
 Improve consumer loyalty and market
reputation
2.5 Ten Customers:
Considering the primary customer segments the following list of 10 customers will be
the major customers of the Abbott in Saudi Arabia
 Public service healthcare organisation
 Small to medium health clinics
 Private healthcare organisation
 Non-Government Organisation
 Private rehabilitation home

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Awareness
Interest
Desire
Action
Personal Presentation
Promotion
Communication
Purchasing
 Residential care organisation
 Sport organizations
 Individual user for personal monitoring
 Emergency and paramedic services
3 VALUE CREATION
3.1 Use Case:
Use case is used to develop the potential customer experience while considering the
influence of the customer’s personality as well as the company’s services and presentation.
For development of Use case in the diabetic diagnosis and healthcare product the AIDA or
Awareness, Interest, Desire and Action model could be used considering the current market
situation of Saudi Arabia (Barr, 2016).

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Customer X
Marketing and
Promotion of Diabetic
products
Presentation
and purchasing
process
Product quality
Maintenance
service and
customer relation
Feedback and Review
collection
Developing Interest
Influencing behaviour
Reconstructing experience
Evaluating Customer’s opinions
3.2 Product Description:
Abbott healthcare company has their specialisation in six product zones namely
cardiovascular products, Diabetes care, Diagnostics, Neuromodulation, Nutrition and
medicine. However, for their new venture in Saudi Arabia the chosen product segments is
diabetic and cardiac care and diagnosis. As diabetic care products, Abbott will offer various
personal and professional diabetes monitoring equipments. At the same time for diabetic
related cardiac complications, cardiac diagnosis systems such as coronary angiogram and