Channel - Stanford University

Report
Engineering 245
The Lean Launch Pad
Professors Steve Blank,
Ann Miura-Ko, Jon Feiber
http://e245.stanford.edu
CHANNELS
how does each customer segment want to be reached?
through which interaction points?
Test Hypotheses: Channel
2
Two Critical Channel Questions
1
2
How do you want to sell your product?
is subtle, but more important than the
first: How does your customer want to
buy your product?
3
How Do You Want Your Product to
Get to Your Customer?





Yourself
Through someone else
Retail
Wholesale
Bundled with other goods or services
4
How Does Your Customer Want to
Buy Your Product from your Channel?






• Same day
• Delivered and installed
• Downloaded
• Bundled with other
products
• As a service
• …
5
Types of Channels
Direct
Indirect
–
–
–
–
Licensing
OEM
VAR
Reseller
Distributor
6
Web Channels
7
Physical Channels
8
The Channel as a Customer
– Some products are embedded in others
(OEM)
– Some products are resold by others (VARs)
– Some products are distributed by others
– Who’s the customer?
9
Distribution Complexity
Global Systems
Systems Integrators
Evangelists
Marketing Complexity
WANs
Mainframes
Direct Sales
Minis
LANs
VARs
PC Servers
Desktop PCs
Retail
Printers
Keyboards
Service
Technicians
Web, Telesales
Toner
Solution Complexity
10
How Are Channels Compensated?
– Commission
– Percentage of sales price
– Discounted pre-purchase
11
How Are Channels Motivated or Incented?
– Money! – what makes them the most?
– Training
– Marketing to the channel
– SPIF
12
Channel Economics: “Direct” Sales
Source: Mark Leslie, Stanford GSB
13
End Consumer
Profit + SG&A + R&D
Discounts
Cost of Goods
(Supply Chain)
EU
List
Revenue Price
Channel Economics: Resellers
Profit + SG&A + R&D
Reseller
Source: Mark Leslie, Stanford GSB
14
End Consumer
Cost of Goods
(Supply Chain)
EU
Revenue
Discounts
List
Price
Channel Economics: Distributors/Resellers
Profit + SG&A +
R&D
Reseller
Source: Mark Leslie, Stanford GSB
15
End Consumer
Cost of Goods
(Supply Chain)
Distributor
Revenue
EU
Discounts
List
Price
Channel Economics: OEM or IP Licensing
Cost of
Goods
(Supply
Chain)
Profit + SG&A
+ R&D
Reseller
End Consumer
Profit + SG&A +
R&D
Distributor
Cost of
Goods
(Supply
Chain)
Master
Distributor
Your Revenue
EU
Discounts
List
Price
Reseller
Your Product Becomes Your
Customer’s Cost of Goods
Source: Mark Leslie, Stanford GSB
16
Example: Book Publishing
Publisher
National
Distributor
Printer
Wholesaler
Retailer
Customer
17
Book Publishing
•Percent of
Retail
Publisher
National
Wholesaler
Distributor
Retailer
35%
15%
10%
40%
$7.00
$3.00
$2.00
$8.00
Customer
$20.00
• You get
- 35% of retail
- the distributor gets 10%
- the wholesaler gets 15%
- the retailer gets 40%
- less any discount they offer the customer
18
Book Publishing Economics
Publisher
National
Distributor
Wholesaler
Retailer
Customer
Allowances
Wholesale costs
Bills
Credit
guarantees
Markup
Payment
guarantees
Payment
guarantees
Return rights
Credits
Payments
19
Book Publishing Delivery
Publisher
National
Distributor
Prepare film
(content)
 Establish
identity
 Create
demand
Prepare
galleys
Printer
Wholesaler
Retailer
Receive
 Schedules
 Print
orders
 Bundle
counts
 Film
Determine
allocations
Merchandise
titles
Deliver
orders
Sell
magazines
Dispose of
returns
Acknowledge
returns
Print and
ship
magazines
20
Nature of Product Impacts Channel:
Physical or Virtual?
– Access to customers changes dramatically
– Logistics related to product complexity
– People as products
21
Bits vs. Atoms
Channel
Web
Physical
Bits
Product
Physical
22
Product and Channel Are Bits
Channel
Web
Physical
 Rapid Agile and
Customer
development
Bits  Fastest to acquire early
customers and scale
Product
Physical
23
Web 2.0 - Product/Channel Are Bits
Channel
Web



Bits


Physical
Google
Twitter
Facebook
Zynga
Cloud Services
Product
Physical
24
Product Is Bits, but Channel Is People
Channel
Web
 Rapid Agile and
Customer
development
Bits  Fastest to acquire early
customers and scale
Physical
 Rapid Agile and
Customer
development
 Traditional sales
channel
 May require installation
Product
Physical
25
Traditional Enterprise Software
Channel
Web



Bits


Google
Twitter
Facebook
Zynga
Cloud Services
Physical
 Microsoft
 SAP
 Oracle
Product
Physical
26
Physical Products Sold Over the Web
Channel
Web
 Rapid Agile and
Customer
development
Bits  Fastest to acquire early
customers and scale
Product
Physical
 Rapid Agile and
Customer
development
 Traditional sales
channel
 May require installation
 Rapid Customer
development
 Logistics, shipping and
Physical
manufacturing critical
 Customer service
27
Killing Traditional Storefronts
Channel
Web



Bits


Google
Twitter
Facebook
Zynga
Cloud Services
Physical
 Microsoft
 SAP
 Oracle
Product


Physical 


Zappos
Amazon
Cafepress
Netflix
Consumer electronics
28
The Factories May Be in China
Channel
Web
 Rapid Agile and
Customer
development
Bits  Fastest to acquire early
customers and scale
Product
 Rapid Customer
development
 Logistics, shipping and
Physical
manufacturing critical
 Customer service
Physical
 Rapid Agile and
Customer
development
 Traditional sales
channel
 May require installation
 Longer customer
feedback cycle
 May require large
capital requirements
for scale
29
We Still Make Things that Need Salespeople
Channel
Web



Bits


Google
Twitter
Facebook
Zynga
Cloud Services
 Microsoft
 SAP
 Oracle
Zappos
Amazon
Cafepress
Netflix
Consumer electronics





Product


Physical 


Physical
Cars
Solar panels
Wind turbines
Bookstores
Consumer electronics
30
Team Deliverable by Next Week
•
•
•
•
•
•
Talk to 10-15 potential channel partners
• (Salesmen, OEM’s distributors, etc.)
What were your hypotheses about who/what
your channel would be? Did you learn anything different?
Did anything change about Value Proposition?
Update your Lean LaunchLab & Canvas
Draw your channel diagram
Summarized in a 5 Minute PowerPoint Presentation
Examples
implantable drug infusion pumps
with remote physician control
for chronic pain patients at home
“the right dose at the right time and place”
Christian Gutierrez (EL), Ellis Meng (PI), Carol Christopher (IM), Tuan Hoang (FE)
Chronic Pain v4
Trade shows
FDA
Foundations
Advocacy Groups
CMS (Medicare)
OEMs
Electronic health
record providers
Marketing Costs
Training
Patients
Formulary Acceptance
KOLs
Wireless
Developers
Faster relief
FS Team
IP
Proprietary
knowledge
Efficient patient
management and
Dosing flexibility
Clinical data
Clinicians
Support
Access to high-value
therapies and
pharmacoeconomics
Hospitals
pharmacoeconomics
Pain clinics
Institutions
Payors/ICA
Human
Resources
Product Dev Costs
Unit sales
Manufacturing Costs
Support Services
FDA/Clinical Trials
Bundled kits
Electronic records
Getting out
Clinicians
Institutions/patients
•
•
Dr. Stan Louie, Drug Formulation Expert (USC Pharmacy)
Dr. Giovanni Cucchiaro, Anesthesiologist (CHLA)
•
Dr. Diana Hull, Physician (Group Health in Washington
state, formerly at Kaiser California)
Thomas Hsu, Insurance Specialist (Network Medical
Management; a California ICA)
Two chronic pain patients
•
•
–
–
Pump user and creator of support forum
User of oral narcotics and patches
Regulatory
•
Dr. Frances Richmond (Director Regulatory Science
Program, USC)
Entrepreneurs/
Industry
•
Richard Hull (formerly at company selling Lapband)
Product flow/Channel
Electronic
Health
Records
Electronic
Records
Patients
Partners/
OEMS
Fluid Synchrony
Support Pump +
Services Controller
Hospitals
(Anesthesiologists
Neurosurgeons)
Pain Clinic
(Anesthesiologists
Neurosurgeons)
Bundled
Kits
Hospitals
Pain Clinics
Channels (Direct)
• Direct to institutions
• Some formularies involved in purchase decisions
• Some doctors make purchase decision directly
• Device company/Doctor relationship is key
• Heavily influenced by :
• Clinical study results
• Regulatory approval
• Reimbursement
Patient Care Flow (Now)
Partners/
OEMS
Fluid Synchrony
Support Pump +
Services Controller
Patient
Discharged
Surgery/Rx/
reprogramming
Hospitals
(Anesthesiologists
Neurosurgeons)
Scheduled
follow-up
Pain Clinic
(Anesthesiologists
Neurosurgeons)
Trial period/
Home setting
Weeks/months
Bundled
Kits
Key factors: Reimbursement , state regulations
Patient Care Flow (Proposed)
Electronic
Health
Records
Partners/
OEMS
Fluid Synchrony
Actionable feedback
to doctors/institutions
Electronic
Records
Support Pump +
Services Controller
Bundled
Kits
E-prescription / closing loop
Patient
Discharged
Surgery/Rx/
reprogramming
Hospitals
(Anesthesiologists
Neurosurgeons)
Scheduled
follow-up
Pain Clinic
(Anesthesiologists
Neurosurgeons)
Trial period/
Home setting
Weeks/months
Days
Key factors: Reimbursement , state regulations
Regulatory considerations
Trial size
Costs
PMA
510K
100’s of patients
20-100
Up to $100,000 per patient
$10-50 MM
Time
$1-10 MM
~ 3-4 yrs + post
~ 2-3 yrs
approval follow-on
• PMA approval with grouping of FDA approved drugs.
• Clinical trials results used to obtain CMS (Medicare) approval
• 510K restricts technology to predicate devices
• Can be more difficult to market against incumbents
• European CE mark is easier to attain (safety and performance only)
Take-aways
• Channel is direct in this existing market
• Channel for e-health is more complex and evolving
• State-to-state regulations can impact incentives
• Can pose problems as electronic records systems vary
across the country
Next Steps
• Understand costs associated with reaching
doctors/institutions directly
• Understand structure of e-health channel
• Develop regulatory pathway (timelines and cost profile)
Advanced Chemistry for
Pharmaceutical Progress
Team: Kiel Neumann (EL)
Stephen DiMagno (PI)
Allan Green (Mentor)
 PET is a non-invasive medical diagnostic
technique for cardiac, brain, and tumor imaging
 GFP technology makes new (unknown) and
known (but clinically inaccessible) [18F]-labeled
radiotracers readily available
 Fast, multiplatform, high efficiency synthesis of
these fleeting, precious agents.
 Initial target indications: pediatric neuroblastoma,
Parkinson’s disease.
44
The Business Model Canvas
cGMP manufacturer
Radiopharmacies
Nuclear Medicine and
Radiology
departments
Pharmaceutical
development
companies
SOPs for precursors
and drugs
Recruit clinical sites
In vivo animal studies
Develop regulatory
plan for pre IND
meeting
ID cGMP CRO
Fund-raising
IP
PoP data
IP
PoP data
Regulatory plan
Understanding of
the regulatory
process
Contract cGMP precursor manufacture
Salary, Rents
Clinical trials
Accessibility (RCY)
Purity
Speed
PET/SPECT
Multiplatform
Sensitivity (nca)
Specific compounds
General
methodology for
adding fluorine to
lead compounds of
interest
Technical Assistance
(Image Atlas)
FDA regulatory support
Radiopharmacies
Equipment producers
Prescribing physicians
Technical assistance
Radiologist who
perform studies
Direct sales of
precursor
Drug developers
R&D and clinical
studies presented in
journals and meetings
Sales of precursor
through global finished
pharmaceutical
distributor
Sales of intermediates
Technology license
Product license (royalty)
Radiologists

Face to Face meeting with president of small radiopharmaceutical
company


Face to face with a clinician at Memorial Sloan-Kettering

OncoKinib collaboration between Geurbet, OncoDesign, and Ariana
pharmaceuticals

Face to face meeting with head of R & D and International Production
Manager from Linz, Austria


Eckert and Zeigler – German PET modular synthesis provider

Introductory teleconference to CEO of Innovation Accelerator
Face to face with Global Production Manager of Molecular imaging for
one of world’s largest radiopharmaceutical companies
Face to face meeting with Executive Director and CEO of Scott Tech
Center in Omaha, NE
49

Significant Interest in our technology

Radiopharmacies want GMP product


Third-party manufacturers would use our developed synthetic
pathways

Internal competition with one world radiopharmaceutical leader


No interest in GMP reagent preparation
Best to approach one of other two world leaders
Scott Tech Center



Willing to offer free advice on startup strategy
Provided introduction to Innovation Accelerator
Offered introduction to Director of Venture Technology of one of
world’s leading radiopharmaceutical companies
50
The Business Model Canvas
cGMP manufacturer
Radiopharmacies
Nuclear Medicine and
Radiology
departments
Pharmaceutical
development
companies
SOPs for precursors
and drugs
Recruit clinical sites
In vivo animal studies
Develop regulatory
plan for pre IND
meeting
ID cGMP CRO
Fund-raising
IP
PoP data
IP
PoP data
Regulatory plan
Understanding of
the regulatory
process
Contract cGMP precursor manufacture
Salary, Rents
Clinical trials
Accessibility (RCY)
Purity
Speed
PET/SPECT
Multiplatform
Sensitivity (nca)
Specific compounds
General
methodology for
adding fluorine to
lead compounds of
interest
Technical Assistance
(Image Atlas)
FDA regulatory support
Radiopharmacies
Equipment producers
Prescribing physicians
Technical assistance
Radiologist who
perform studies
Direct sales of
precursor
Drug developers
R&D and clinical
studies presented in
journals and meetings
Sales of precursor
through global finished
pharmaceutical
distributor
Sales of intermediates
Technology license
Product license (royalty)
Radiologists
• F-dopa iodonium intermediate
• F-dopamine iodonium intermediate
We provide accessibility
Reagents
Could license
precursor synthesis
for incorporation in
modules
•ABX
•Eckert & Ziegler
•GE MX module for TracerLab
GMP Cassette or
•Siemens Explora
Components
GMP Compliant
Synthesizer
•TracerLab/ GE
•Eckert & Ziegler
•Siemens Explora
•Neoprobe
•Synthra
PET
Radiopharmacy
distributor
•Siemens PETNet
•GE Amersham
•Cardinal Health
•AAA
•Iason
Require GMP precursor
(or cassette) to develop
our product with their
synthesizer
Only want GMP
precursor in modules
without development
52

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