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

4BIOMEDICAL INNOVATION AND VENTURE CREATION
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

5BIOMEDICAL INNOVATION AND VENTURE CREATION
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

6BIOMEDICAL INNOVATION AND VENTURE CREATION
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

7BIOMEDICAL INNOVATION AND VENTURE CREATION
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

8BIOMEDICAL INNOVATION AND VENTURE CREATION
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

9BIOMEDICAL INNOVATION AND VENTURE CREATION
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

10BIOMEDICAL INNOVATION AND VENTURE CREATION
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).

11BIOMEDICAL INNOVATION AND VENTURE CREATION
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

12BIOMEDICAL INNOVATION AND VENTURE CREATION
thallium stress test and ECG will be considered. Apart from that, Abbott is also going to offer
an advanced daily care application that is able to develop regular healthy food consumption
schedule and diet chart as per the diabetic reports. Apart from that, various diabetic care
powders or medicinal consumables will be offered. Therefore the products will be
 Coronary CT Angiography
 Haematology analyser
 Freestyle Glucometer
 Flash Glucose Monitoring System
 ECG
 Thallium stress test system
 Glucose and Ketone testing system
 Diabetes care powder
 Diabetes care planning application
3.3 Problem:
In Saudi Arabia, the transportation and logistics system is very weak compared to
other conventional customer base of Abbott. Lack of proper traffic plan and adequately
facilitated logistics system will not allow the company to take the opportunity of partnering
with any delivery companies. At the same time the products of many multinational and
famous biomedical companies are already available to the healthcare organisations as well as
to the personal users (Cooper, 2017). Therefore, in this situation Abbott Libratory has to
develop their own logistics and transportation system to ensure the quality of post purchasing
delivery and service quality. However, it will cost additional effort and investment to develop
a customise logistics and warehouse distribution planning.

13BIOMEDICAL INNOVATION AND VENTURE CREATION
3.4 Quantified Value Proposition:
The quantified value proposition refers the precise and clear statement of the process
through which the company can resolve all the issues related to products and the target
customers while considering the values of the products and the demand of the potential
customers. In this case, Medtronic has to ensure the quality of the products without
compromising the operational cost. At the same time, initially the company can also provide
first 5 years free service and repairing under the regulation of customer rights (Eftekhari &
Bogers, 2015). Through this value preposition the company can earn at least twice of its
investment form their increasing market reputation and market share.
4 COMPETITIVE ADVANTAGE
4.1 Moats:
Moats are a strategic business policy that allows any business to increase the
competitiveness. Therefore, to compete in the biomedical industry of Saudi Arabia Abbott
needs to invest as per the industrial situation that will also require the adequate market
research. At the same time, as their basic value research based product development could
increase their competitive advantage significantly (Enteshari & Varshosaz, 2018). As
example glucose monitoring system is common to the healthcare marker of Saudi Arabia,
where the lancets free flash based glucose monitoring device will be unique and
differentiable choice. Therefore it could be a very strong Moats strategy of Abbott.
4.2 Core:
Abbott Laboratory has three major core strategies, through which they can increase
their recognition and market share in the healthcare industry of Saudi Arabia. These main
three core strategies are research based development, uplifting customer satisfaction,

14BIOMEDICAL INNOVATION AND VENTURE CREATION
empowering the internal strengths. The research based product development strategy enables
them to develop diverse and differentiable products. For their diversification, they will
develop the parallel production lines where multiple products could be manufactured
simultaneously. Besides, for customer satisfaction the company considers both the immediate
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.
4.3 Competitive Positioning:
Balancing the product quality and price is a major factor in any competitive
positioning strategy. For affective competitive positioning, Abbott is developing durable and
more accurate glucose monitoring system, which will be their strength for promotional
activity as well. Currently, most of the healthcare organisations in Saudi Arabia can recognise
the brand of Abbott. However, the quality and facilities of the product can make their
products unique and differentiable. Apart from that, by using product differentiation strategy
Abbott will help to modulate the maximum production costing in a systematic way where the
supply chain will take a great position without compromising the quality of the products.
Therefore, in price quality competitive positioning Abbott will put their products moderate
price differentiable and high quality coordinates.
5 CUSTOMER ACQUISITION
5.1 Decision Making Unit:
Decision making unit refers the stakeholders groups of any business that directly
regulate or support the decision making process through positive involvement. The five major
decision making units of Abbott Laboratory are Buyers, Gate-keepers, Users, Initiators,
Influencers and Decision makers.

15BIOMEDICAL INNOVATION AND VENTURE CREATION
Byers
Byers are the direct purchasers
of the products. The products of
the Medtronic will be purchased
by various healthcare
organisations and laboratories.
Therefore, prioritising their
opinions is very essential.
Decision Maker
Decision makers are the most
responsible and most interested
stakeholder of any business.
Therefore for Abbott the
Decision Maker is the
management board and the
owner of the organisation.
Gate Keeper
Gate keepers are the core
information collector of any
business organisation. In this
case the distributors, suppliers
and business partners of
Medtronic will be the gate
keepers.
Users
Users refer the end users who
will use the product. For the
product of Abbott the users are
patients and healthcare
receivers. Therefore their
preferences should also be
considered while making
decision.
Initiator
Initiators will detect the
problem or the satisfaction level
of the consumers. For Abbott
the initiators are distributors.
Influencers
Influencers can influence the
market to purchase or reject any
product through regulating their
psychological factors. In this
case the local advertisers will be
the influences of Abbott.
5.2 Customer Buying Process:
The customer Buying process includes all the necessary attributes of pre-purchasing,
purchasing and post-purchasing phase the can define the overall experience of the customers
of Abbott Laboratory in the healthcare industry of Saudi Arabia.

16BIOMEDICAL INNOVATION AND VENTURE CREATION
Marketing and
Promotion of ventilation
products
Optional or
Alternatives
Product Quality
Post purchasing
service
Consumer relationship
Developing needs
Searching for information
Purchasing Decision Making
Post purchasing experience
Purchasing Experience
Selling process
Personal and social
influences
Expectations
Developing new
expectation and
experience
Customer Experience External FactorsInternal Factors
5.3 Windows of Opportunity:
Lack of competition and market reputation are the major opportunities of the world
famous biomedical company named Abbott. Because of the well featured distribution
networks the healthcare organisations of Saudi Arabia already knows the product value of the
Abbott’s products. At the same time, Saudi Arabia has very weak onshore biomedical
industry that will makes multiple opportunities to increase the market share while making
strong presence in the healthcare market without depending on any importing mechanism
(Freiberg, Schwarz & Fath, 2015). Besides, starting the business in Saudi Arabia will also

17BIOMEDICAL INNOVATION AND VENTURE CREATION
allow Abbott to communicate directly with the existing and the potential customers, which
will help them to expand across the Middle East.
5.4 Possible Triggers:
The possible triggers can come from mainly 4 places including the cultural stability,
political situation, market acceptance and financial crisis. In terms of cultural stability,
Abbott has to handle their new market and the local community in a very competent way
where their social values and ethics would not be hampered. On the other hand, any changes
in political situation can change the entire business process and even market scenario.
Therefore, it can be considered as a major risk for a new venture like Abbott. On the other
hand, the selection of product segments for initial market intervention will be useful for both
professional and personal use. Therefore, because of this dynamic utilisation, the scope or
rejection will became also high (Gaynor, Ho & Town, 2015). Therefore, Abbott should
always be prepared for changing their product segment. On the contrary, the higher
acceptance will also trigger better investment and more market expansion. Finally, the
financial equity will be the most anticipated factor. Because of the global economical
turbulence, any financial crisis can become a major trigger for ultimate destruction.
5.5 Regulatory Strategy:
To explore, examine, interact and penetrate through the new market of Saudi Arabia
Abbott will need some affective regulatory strategies, which will allow them to control their
workforce as well as the workflow towards a formulated and profitable direction. The
following regulatory strategies will help the organisation to achieve these goals.
 Monitoring employees to ensures the best manufacturing devices

18BIOMEDICAL INNOVATION AND VENTURE CREATION
 Collecting data from employees to supervise the progression of manufacturing
 Collecting data from the quality control team to identify the quality of the manufactured
product
 Collecting data from the risk assessment team for addressing risk factors in the company
 Monitoring manufactured product supplies from suppliers
 Monitoring the activities of distributors to distribute the product
 Gathering resources from the comminute efficiently
5.6 Reimbursement Strategy:
Reimbursement strategy of Abbott will allow the organisation to secure their
sustainability of product manufacturing cycle through proper equipment care, maintenance,
operational and financial procurement (Haq et al., 2017). The following strategies will be
very valuable for Abbott to expand their business in Saudi Arabia and the extended Middle
East.
 Identifying the factors that lead to the loss an invent a way to mitigate it
 Accelerate shifting the financial risk to provide for aligning the payer's providers
incentives
 optimize the provider's network design and performance of the employees and other
stakeholders
 Supporting enhanced IT and business intelligence infrastructure
 Support the innovation. The key challenge, in this case, is to identify the point at which
the covering cost of utilizing new technologies and relate it to the product
 Integrate with providers to repay the loss.

19BIOMEDICAL INNOVATION AND VENTURE CREATION
6 PRODUCT UNIT ECONOMICS
6.1 Business Model:
Many business models are available that can be operated by Abbott namely vertical
business model, platform model, heath integrated model, reusable production model,
disposable product model and cost leadership model. Lack of direct manufacturer of
healthcare equipments has reduced the healthcare integrity in the biomedical industry of
Saudi Arabia (Ilangovan, Mahanty & Sen, 2016). Therefore, making health integrated
business model will be the most beneficial model for Abbott. It will allow the company to
manufacture their products in a advanced way that can be used as a plug and play device in a
healthcare facility if it would be installed in a same platform. Therefore, it will increase the
demand of the products produced by Abbott exponentially.
6.2 Pricing:
Because of complex and ever expanding distributors in Saudi Arabia the potential
customers are already receiving enough convenient products for the services. Therefore, to
empower the competitive advantages Abbott need to focus on premium pricing strategy.
Using premium pricing strategy Abbott could restrict the existing customers from using other
products instead of Abbotts. In this strategy, the company will provide special price range
and many other service related benefits to their loyal or premium customers (Järvinen &
Taiminen, 2016). Apart from that, It will also restrict the upper bandwidth of production cost
without compromising the quality of the products. Therefore, the resultant price of the
products will be lower compared to the other international biomedical brands.

20BIOMEDICAL INNOVATION AND VENTURE CREATION
6.3 Short Term LTV:
The Life Time Value is also known as the Customer Life Value, which is the total
contribution of every customers within the revenue of the organisation. Therefore, the gross
revenue growth, average transaction of each month and the customer lifespan by month will
be considered. In Saudi Arabian Healthcare industry it can be expected that the average gross
margin of Abbott Laboratory will be increased by 6%, where the initial value transaction will
be 3200. If the average lifespan of a customer be 5 months, the LTV will be
Average Gross Margin
(EAGM)
Average Transaction
(AMT)
Customer Lifespan
(CL)
LTV
(EAGM x AMT x CL)
6% 3200 5 960
The LTV ratio of short term is 960 which indicates that the Transaction amount of the
company is approximately double of the Life Time Value of the each customer. Therefore, in
this phase the market penetration power will be also weak because of the low LTV margin
6.4 Short Term COCA:
The short term COCA is the initial Cost of Consumer Accusation, which implies the
cost or investment Abbott Laboratory needs to do for gaining 1 customer. The initial target of
GE Healthcare will be gaining at least 35 new customers spending 18000 for marketing and
promotion. Therefore the short term COCA GE Healthcare will be
Investment for Marketing and promotion Newly Acquired Customers 18,000 COCA
18,000 35 35 514

21BIOMEDICAL INNOVATION AND VENTURE CREATION
Therefore, as per the COCA ratio the average investment for acquiring existing level of
consumer loyalty the company has to estimate 5.14 as their promotional and marketing
investment.
6.5 Medium Term LTV:
In Saudi Arabian Healthcare industry it can be expected that the average gross margin
of Abbott Laboratory will be increased by 7% as a midterm target, where the value
transaction will be 3500. If the average lifespan of a customer be 7 months, the medium term
LTV will be
Average Gross Margin
(EAGM)
Average Transaction
(AMT)
Customer Lifespan
(CL)
LTV
(EAGM x AMT x CL)
7% 3500 7 1715
The LTV ratio of short term is 1715 which indicates that the Transaction amount of
the company is lower than the Life Time Value of the each customer. Therefore, in this phase
the market penetration power will be very strong because of the high LTV margin
6.6 Medium Term COCA:
The Medium term COCA is the middle term Cost of Consumer Accusation, for
gaining 1 customer. The midterm target of Abbott Laboratory will be gaining at least 40 new
customers spending only 12000 for marketing and promotion. Therefore the short term
COCA GE Healthcare will be
Investment for Marketing and promotion Newly Acquired Customers 12,000 COCA

22BIOMEDICAL INNOVATION AND VENTURE CREATION
12,000 40 40 300
Therefore, as per the COCA ratio the average investment for acquiring existing level
of consumer loyalty the company has to estimate 3 as their promotional and marketing
investment.
6.7 Long Term LTV:
In Saudi Arabian Healthcare industry it can be expected that in long term the average
gross margin of Abbott Laboratory will be increased by 8%, where the initial value
transaction will be 3200. If the average lifespan of a customer be 10 months, the LTV will be
Average Gross Margin
(EAGM)
Average Transaction
(AMT)
Customer Lifespan
(CL)
LTV
(EAGM x AMT x CL)
8% 3200 10 2560
The LTV ratio of long term is 2560 which indicates that the Transaction amount of
the company is approximately equal to the Life Time Value of the each customer. Therefore,
in this phase the market penetration power will be also balanced because of the estimated
LTV margin.
6.8 Long Term COCA:
The long term COCA is the initial Cost of Consumer Accusation, which implies the
cost or investment Abbott Laboratory needs to do for gaining 1 customer. The long term

23BIOMEDICAL INNOVATION AND VENTURE CREATION
target of GE Healthcare will be gaining at least 35 new customers spending 25000 for
marketing and promotion. Therefore the short term COCA GE Healthcare will be
Investment for Marketing and promotion Newly Acquired Customers 25,000 COCA
25,000 32 32 781
Therefore, as per the COCA ratio the average investment for acquiring existing level
of consumer loyalty the company has to estimate 7.81 as their long term promotional and
marketing investment.
7 SALES
7.1 Preferred Sales Channel:
Sales channels defines the strategic selection of outbound logistics that ensures the
delivering of the products and service and the accessibility of the target customers as well as
end users. Both directly and indirectly the sales channel can be operated. Abbott will not
depend not depend on the indirect sales channel, because depending on a external distributors
or retailers will not allow enough opportunity to increase the brand recognition (Enteshari &
Varshosaz, 2018). On the other hand, being a new venture Abbott will not able to
strategically handle the partnership with external distributors. Hence, selling the products
through direct channel will be beneficial for short time financial and business achievements.
7.2 Sales Funnel:
Sales Funnel is a framework, which allows narrowing down the customer base
through a synchronised format, while considering the existing customers as the most

24BIOMEDICAL INNOVATION AND VENTURE CREATION
narrowed target, potential customers as the most diverged target. At the same time, for the
healthcare and biomedical industry of Saudi Arabia Abbott has to take care of each individual
elements of sales funnel that includes the making the customers aware of the product, making
the product sales intriguing for customers to buy. It also involves evaluation with solutions of
other companies, followed by taking a proper decision finally followed by purchasing the
product.
7.3 Short Term Mix:
Short term mix is the sales strategy that will be beneficial for Abbott in a short run. In
other words, the short term mix will allow the company to develop their promotional strategy
for 1 year after the initial bringing out. For an internationalised company like Abbott
Laboratory the short term promotional mix will include the satellite advertisement and digital
advertisement (Gaynor, & Town, 2015). As digital advertisement the company will focus on
the social media based promotion through various social media pages and blogs.
7.4 Medium Term Mix:
Medium term mix is the sales strategy that will be beneficial for Abbott in a moderate
phase run. In other words, the medium term mix will allow the company to develop their
promotional strategy for 2 to 5 years after implementing the initial marketing and
promotional strategy. For an internationalised company like Abbott Laboratory the medium
term promotional mix will include sponsorship based promotion (Kaftan, Kelly & Platsch,
2017). For sponsorship the company will focus various charitable healthcare events, such as
free dental checkups, free medication, NGO based rehabilitation and others.
7.5 Long Term Mix:
Long term mix is the sales strategy that will be beneficial for Abbott in a long run. In
other words, the medium term mix will allow the company to develop their promotional

25BIOMEDICAL INNOVATION AND VENTURE CREATION
strategy after 5 years following by implementing the medium term marketing and
promotional strategy. For an internationalised company like Abbott Laboratory the long term
promotional mix will include partnership based marketing (Khaled et al., 2015). For
partnership based marketing Abbott should focus on various suppliers of raw materials of
Saudi Arabia and Middle East. This partnership approach will also enable Abbott to enhance
their market knowledge about the extended market of Middle East.
8 OVERALL ECONOMICS
8.1 Estimated R&D Expenses:
Year Investment Research and Development Total asset after year ending
1st year 420,000 490,000
2nd Year 320,000 550,000
3rd Year 450,000 620,000
4th Year 600,000 750,000
5th Year 520,000 820,000
8.2 Estimated G&A Expenses:
Year Investment Research and Development Total asset after year ending
1st year 52,000 450,000
2nd Year 75,000 650,000
3rd Year 62,000 720,000
4th Year 80,000 880,000
5th Year 90,000 960,000

26BIOMEDICAL INNOVATION AND VENTURE CREATION
8.3 LTV/ COCA Ratio:
The Ratio of Life Time Value and the Cost of Customer Accusation will help Abbott
Laboratory to measure how feasible their investment in marketing and promotional activities
is. In this case, the ration of LTV and COCA will be also examined through 3 separate
timelines or phases.
Short Term LTV COCA 960 LTV/COCA (approx)
960 514 514 2:1
Medium Term LTV COCA 1715 LTV/COCA (approx)
1715 300 300 5:1
Long Term LTV COCA 2560 LTV/COCA (approx)
2560 781 781 3:1
Ad\s per the ratio, it is clear that at initial or short term phase the customer accusation
cost was not profitable for the company because of its very poor contribution in LTV
generation. On the contrary, in medium term the LTV is very high, where the lack of
customer accusation investment is able to restrict the potential customer increment. In the
long term business strategy the ratio of LTV and COCA is beneficial because of its 3:1 ratio.
9 DESIGN & BUILD
9.1 Key Assumptions:
Business, in most cases, occurs in an unsure setting and assumptions are necessary to
move ahead with stratagem. The major issue that Abbott could face includes lack of efficient
suppliers because of the poor production chain of the Biomechanical manufacturing industry.
from that, transportation as well as internet facilities would be another major risk for the most
of the Middle East region. However, one of the positive assumptions is the market reputation
of the organisation and the potential demand across the market.

27BIOMEDICAL INNOVATION AND VENTURE CREATION
9.2 Assumptions Tests:
For a new business to succeed, many assumptions have to prove true. Testing
assumptions in a logical order gives the team the best chance of making course corrections
early — and not wasting time and money. For their new market in Middle East and more
specifically in Saudi Arabia, Abbott Biomedical and Biomechanical manufacturing and
supplier company needs to outline a method for (1) identifying the assumptions or unknowns
and (2) resolving these assumptions on the basis of three parameters: severity, probability,
and cost of resolution
9.3 MVBP:
A Minimum Viable Business Product or MVBP is a product with just enough features
to satisfy initial target customers. It is also helpful to collect market feedback for future
product development. The benefit of this MVBP technique is it requires less monitory
investment than the arbitrary product development. Gathering insights from an MVP is will
help to develop more potentially attractive products for the target market. In this case Abbott
has to choose the most optimum products for the new market which will act as a MVP
(Lackéus & Williams Middleton, 2015). After collecting feedback of the market, they can
customise their future products according to the customer choice, their purchasing behaviour
and potential interests. Abbott should typically deploy their MVBP product to a subset of
possible customers—such as early adopters thought to be more forgiving, more likely to give
feedback, and able to grasp a product vision from an early prototype or marketing
information. For MVBP testing Abbott Laboratory has the following products to offer:
 Coronary CT Angiography
 Haematology analyser
 Freestyle Glucometer

28BIOMEDICAL INNOVATION AND VENTURE CREATION
 Flash Glucose Monitoring System
 Thallium stress test system
 Glucose and Ketone testing system
 Diabetes care powder
 Diabetes care planning application
 ECG
9.4 Tracking Metrics:
Criteria Weighting 2 -0.5 2 1 -0.5 Relative
Benefit
Priority
Relative measures
Business Components
Relative
ROI
Relative
Cost
Relative
Demand
Relative
Time
Relative
Risk
Coronary CT Angiography 5 2 2 4 3 15.5 1
Haematology analyser 2 3 1 2 4 4.5 11
Freestyle Glucometer 3 2 3 2 1 12.5 5
Flash Glucose Monitoring
System
4 2 1 3 4
10
7
Thallium stress test system 2 3 4 2 3 11 6
Glucose and Ketone testing
system
3 4 1 2 3
6.5
10
Diabetes care powder 4 1 3 2 2 14.5 2
Diabetes care planning
application
2 3 2 4 2
9.5
8
ECG 3 2 1 2 1 8.5 9

29BIOMEDICAL INNOVATION AND VENTURE CREATION
10 SCALING
10.1 Product Plan for Beachhead Market:
Initial Product Medium term product Long term product
 Diabetes care planning
application
 Glucose and Ketone
testing system
 Flash Glucose Monitoring
System
 Haematology analyser
 Diabetes care powder
 Diabetes care planning
application
 Coronary CT
Angiography
 Freestyle Glucometer
 ECG
 MRI and SCS system
 X-Ray Machines
 Acute Care Diagnostic System
 Digital Morphology Systems
 DRG Neurostimulator System
 Metabolic Nutrition
10.2 Next Market:
The healthcare organizations of total Middle East are developing and the government
of the nation is trying to enhance the efficiency of the healthcare home through
implementation of modern healthcare equipments. Thus, the mentioned market across the
Middle East possesses the potential to farther enhancement of the profitability of the
organization largely (Lichtenstein, 2016). The choice of the next phase market is totally
based on the compatibility between the product and the resources available along with the
newer market itself. After presenting the products successfully in Saudi Arabia, the company
should take the market extended to the other developed as well as developing countries in
Middle East like UAE, Oman, Egypt, Lebanon and others.

30BIOMEDICAL INNOVATION AND VENTURE CREATION
10.3 Product Plan Beyond Beachhead Market:
The product plan for beyond the market of Saudi Arabia the focus of this organization
name Abbott Laboratory should be the peripheral healthcare service users (Lichtenstein,
2016). When it comes to products, the organization manufactures healthcare equipment that
is required to focus on their secondary production systems that includes.
 Diabetes care planning application
 Glucose and Ketone testing system
 Flash Glucose Monitoring System
 Haematology analyser
 Diabetes care powder
 Diabetes care planning application
10.4 Follow-on 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
(Singhal et al., 2016). Therefore, as TAM the corresponding developing countries of Saudi
Arabia will be considered.

31BIOMEDICAL INNOVATION AND VENTURE CREATION
11 VENTURE FORMATION
11.1 Stakeholders:
Abbott is a biomedical company that involves in manufacturing of the biomedical
equipment in the areas of electrifications and automation and digitization. therefore, the
stakeholders are the directors, employees, government agents of the firm, the supplier of the
equipment, distributors, community from which it draws resources and hospital
administrators and facilities.
11.2 Define Roles & Responsibilities:
 The Roles of directors is to supervise the company and ensures the revenue through
the highest manufacturing
 Role if the employees are to involve themselves in the manufacturing of the
biomedical equipment in order to retain customers’ interest (Woolhandler &
Himmelstein, 2017)
 The role of the government's agents of the firm is to involve themselves in the legal
issues and advocacy that in turn assist the company to legally supply their products
 The Roles of a supplier is to supply the equipment to different distributors
 The role of the distributors is to distribute the manufactured product into different
health care brunches
 The role of the community from which it draws resources is to provide resources for
manufacturing product successfully.
 The role of hospital administrators and facilities is to use it in the different surgeries
and providing patient-centric care
11.3 Assign Roles & Responsibilities:
Role Responsibility

32BIOMEDICAL INNOVATION AND VENTURE CREATION
General Manager Supervising and managing all the departments while
leading the departmental superiors
Human Resource Recruiting and Managing workforce while keeping them
safe and healthy
Administrator Facilitating the premises with technology and fundamental
advancement (Welter et al., 2017)
Logistics Manager Supervising and maintain Inbound, Outbound and
manufacturing chain
Finance and accounts executive Accounting payroll, measuring performance, publishing
budget and estimating benefits
Sales and Marketing Manager Conducting market research, making customer
relationship, selling products, improving market share and
reputation
Legal advisor Keeping legal compliance for all aspects of the business
operations
Employees Maintaining workflow with healthy relationship and
cooperating environment in order to improve the capability
of sustainable coordination
11.4 Engagements:
Stakeholders Engagement Power Interest
Director/ owner Internal Primary Very High High
Management Internal Primary High Moderate
Suppliers External Secondary High Low
Employees Internal Primary Moderate Moderate
Customers External Primary Low High
Governments External Tertiary High Low
Community External Secondary Moderate Moderate

33BIOMEDICAL INNOVATION AND VENTURE CREATION
11.5 Corporate Filings:
Corporate filling is the group of procedures that help any business to evaluate their
legal policies while taking care of legitimate value exchange process. In other words,
corporate filling is mainly associated with the contractual document, bondage agreement,
licensing, trading permission granting and other regulatory operations (Tashkandi & Al-Jabri,
2015). Beside the business and operational procedures, corporate filling is also essential for
workforce handling, which is related with the occupational health and safety as well as
compensation compliances.
11.6 Formation Agreements:
A contract is a promise or set of promises that are legally enforced and if violated, it
allows the injured part to access the legal remedies. The agreement would be formed between
manager and community from whom they collect resources where price, terms and conditions
and rules and regulations would be mentioned. The similar kind of the contract would be
formed between manager and employees (Zahra, & Wright, 2016). The second agreement
would be formed between supplier and distributors where the supplier would mention the
price of the manufactured product, terms and conditions.
12 CAPITALIZATION
12.1 Capital Need:
Current and Potential Assets
Initial Revenue 1,500,000
Account Receivable or Loan 16,500,000
Investors contribution 30,000,000
TOTAL 48,000,000

34BIOMEDICAL INNOVATION AND VENTURE CREATION
Current and Potential Liabilities
Payable Accounts 15,000,000
Short term Borrowings 50,000
Additional Miscellaneous Liabilities 5,850,000
TOTAL 25,900,000
Working Capital 19,000,000
12.2 Use of Funds:
Operational components Unit Per Unit Cost Total expense
Manufacturing 12 35000 420000
Logistics and Transportation 5 18000 90000
Human Capital investment 60 5000 300000
IT and Communication 15 1500 22500
Research and Development 5 20000 100000
General and Administration 7 12000 84000
Marketing and Promotion 10 15000 150000
Miscellaneous expenditure 560000 560000
TOTAL 1726500

35BIOMEDICAL INNOVATION AND VENTURE CREATION
12.3 Offering Type:
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 (Voigt et al., 2016). At the same
time for diabetic related cardiac complications, cardiac diagnosis systems such as coronary
angiogram and thallium stress test and ECG will be considered. Apart from that, Abbott is
also going to offer an advanced daily care application that is able to develop regular healthy
food consumption schedule and diet chart as per the diabetic reports. Apart from that, various
diabetic care powders or medicinal consumables will be offered. Therefore the products will
be
 Coronary CT Angiography
 Haematology analyser
 Freestyle Glucometer
 Flash Glucose Monitoring System
 ECG
 Thallium stress test system
 Glucose and Ketone testing system
 Diabetes care powder
 Diabetes care planning application
12.4 Pre-Money Valuation:
Value Percent

36BIOMEDICAL INNOVATION AND VENTURE CREATION
Entrepreneur 3,000,000 66.66%
Investors 1,500,000 33.33%
Total 4,500,000 100%
12.5 Post-Money Valuation:
Value Percent
Entrepreneur 2,500,000 62.5%
Investors 1,500,000 37.5%
Total 4,000,000 100%
12.6 Investor Profile:
Considering the fact that the Abbott conducts Business to business deal, in the
following table, where a persona of Mr. A, the operational director of PQR organization has
been conducted.
12.7 Investor Persona:
Background
 Operational Director of the ABC
NGO organization
 Working at the ABC organization for
more than 10 years
Demographics
 Female
 Age: 30-45 years
 Dual HH income: N/A
 Suburban

37BIOMEDICAL INNOVATION AND VENTURE CREATION
Roles
 To manage the organizational issues
associated with donation
 To conduct venture sharing
 To analyse the market in order to
understand both internal as well as
external environment.
Goals
 To select suitable suppliers for the
ABC healthcare home.
 Enhance the CSR of the company.
 Enhance the partner’s loyalty.
12.8 Ten Investors:
In terms of investor Abbott has to collect the maximum and legitimate funding under
proper partnership strategy and specific agreements. The following stakeholders or potential
stakeholder could be the ten investors for Abbott Laboratory in Saudi Arabia.
1. Suppliers
2. Business Partners and shareholders
3. Non-Government organizations
4. Trusty boards
5. Medical research institutes
6. Rehabilitation centres
7. Global Abbott Healthcare Group
8. Distributing Networks
9. Sports organization

38BIOMEDICAL INNOVATION AND VENTURE CREATION
10. Pharmaceuticals

39BIOMEDICAL INNOVATION AND VENTURE CREATION
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