Problem Statement – ​​Biopure (BPC), is a small, privately held developer of human (Hemopure) and animal (Oxyglobin) blood substitutes. Biopure is faced with the decision whether to launch Oxyglobin (Og) immediately or wait until the launch of hemapure (Hp), which will come about two years after FDA approval. If they decide to take the plunge, they need to determine their pricing strategy. The concern is that the launch of Oxyblobin would create a price headwind for Hemopure, the company's initial product. Market Analysis – The combination of the lengthy FDA approval process, intellectual property laws, and research and development capital requirements poses a high barrier to entry in the blood substitutes markets. The human market is expected to experience moderate future growth, influenced by an increase in the population, and in particular the proportion of older citizens. Furthermore, the human market suffers from non-uniform seasonal variations in blood supply and demand. There is higher demand during the summer and winter holidays and this demand is exacerbated by lower donations. Although the total potential size of the human market in the United States is 13.5 million units (Figure 1), Hemopure's long shelf life and lack of need for refrigeration make it particularly suitable for trauma cases estimated at 2 million of units. The existing system for supplying animal blood products is unable to match animal blood types and is relatively expensive, leading to an underserved market. Veterinarians use approximately 350,000 units of blood per year in canine transfusions, all of which could be captured by Og. The potential market size is estimated at just 2.3 million (Figure 2). Even with smaller demand, however, BPC's 300,000 capacity would still leave some excess... mid-paper... very likely as the human blood substitute market would be under-supplied, leading to higher prices and BPCs they would take the price, following Baxter's lead. Furthermore, advertising focused on differentiating HP from OG should serve to ensure that the price of one product is not correlated with that of the other, minimizing market accusations of excessive pricing. To maximize profits, BPC should do its own distribution rather than using independent distributors (Figure 13). Aside from cost savings, maintaining its own sales force would allow BPC to minimize advertising costs by focusing on early adopters. As Moore explains in Crossing the Chasm (Figure 14), BPC would target emergency practices as early adopters, establish the product, and then cross the chasm as primary care practices recognize the benefits and begin using Og..