Biosidus: Biotecnologia En La Patagonia

The case follows an Argentinean biotech firm as it sets future firm strategy and decides how to fund it. Specifically, the firm is working on a method to produce human growth hormone through the milk of cloned cows. Economic and political uncertainties in Argentina complicate an otherwise challenging strategic decision. Students are required to make a decision based on the conditions present at the time of the case. Excerpt UVA-S-0115 Rev. Aug. 22, 2012 BioSidus: Biotecnologia en la Patagonia In early August 2002, Marcelo Arguelles, son of Antonio Arguelles, the founder of BioSidus, faced a very tough decision concerning the future of the company. BioSidus could no longer implement its 10-year business plan given the current political and economic crises in Argentina. Therefore, Arguelles needed to reevaluate his company's direction along three potential paths. First, should his company focus on its current product base and harvest its existing portfolio of drugs? Second, should it invest in R&D despite adverse market conditions? Third, should it forge a new international partnership to establish a greater market for its current products? BioSidus's latest R&D development involved farm animal cloning techniques that used animals to produce new proteins, which would then be secreted and harvested from their milk. After one unsuccessful attempt, the company anxiously awaited the birth of its second cloned calf. If successful, this new technique would significantly reduce the production costs of proteins, transferring the production line from a multi-million-dollar state-of-the-art facility to a cow (see Exhibit 1 for an illustration of the cloning process). Arguelles was confident that this new technique would revolutionize the industry. He was uncertain, however, of what it would mean for the rest of his company if the cloning was unsuccessful. Faced with a restrictive financial market and weak demand, Arguelles was not sure the company would have enough strength to complete the project. . . .