Market $ story

Market $ story: Quick method to estimate the market size for a new drug

Understanding market size is crucial, as emphasized during my MBA and on shows like Shark Tank. It's a key question in real-world scenarios too. To estimate annual revenue of a drug, you need three parameters:

1. WAC (Wholesale Acquisition Cost) per pack: This is readily available online (eg $5,000 per pack)

2. Number of packs required per patient annually: 

>Determine mg or units per pack 

>Calculate mg or units per dose

>Find out number of doses a patient needs annually (is present on drug website or clinical trial)

(eg. If one pack contains 60 tablets and a patient takes 2 tablets daily, that's 1 pack per month, leading to 12 packs per year for a patient

3. Number of patients on therapy:

Based on target addressable market, estimate the % of patients using the drug in the first year (you can use market capture of any analog drug) (eg 5% of 20,000 target patients)

Annual revenue calculation = WAC # packs per patient # patients

$60M annual revenue = $5,000 12 packs 1,000 patients

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