Kendle Case Study

Kendle internation Inc.

1. I For a systematic study of business models, we need to define business models and distinguish their different types. We define a business model as consisting of two elements: (a) what the business does, and (b) how the business makes money doing these things.

Kendle International Inc is a closely held company engaged in the business of Clinical Contract Research. The Pharma-Companies outsource their clinical research activity to agencies like kendle.

Company is basically a research consulting firm that would take on outsourced research and development (R&D) works on a contract basis from large pharmaceutical and biotechnology companies. Company derive their income solely from outsource portion of the R&D budget of pharmaceutical clients.

The durg companies have to submit their data to FDA for regulatory clearance. There is considerable amount of data collection by the investigators, monitoring of the process and data retrieval by the pharmaceutical company, and analysis of the data to determine whether statistical criteria for safety and efficacy were met.

II The business revenue and profitability key factor depends upon the CRO Company’s clinical trial base. The whole process is an incredible race against the time, as every day for which FDA approval was delayed could cost the pharmaceutical client over 1 million $ in term of loss of revenue. Pharmaceutical contracts ranged in duration from a few months to several years. For multi year contracts involving clinical trials a portion of contract fees was paid at the time the trial was initiated with balance of the contract fees payable in installments over the trial duration as performance based milestones.

III The CRO business of Kedle International Inc. entailed several type business risk:

a. Price of Contract and Cost parity.

b. Project Cancellation by client

c. Change Order by client including nature of research....