A pharmaceutical company is developing and planning to launch a new oral drug for cancer. The product manager needs a 10 year forecast of net sales to make decisions about the products potential sales.

Your assignment is to complete a 10 year forecast of Net $ of pharmaceutical sales using the Excel Spreadsheet approach. The Chain Ratio Spreadsheet Shell is in the folder in Moodle. This is a population based forecasting method using the assumptions below and the Excel file provided. Some assumptions are constants and some are variables. The assumptions are used to calculate intermediate and final values. If you get the first column correct, its likely you have done the whole 10 years correctly.

The assumptions are:

US population = 330 million in year 1

Growth rate for the population is 1% use this rate to calculate existing plus added population each year

Prevalence of the disorder (# of patients treated) = 10% of the population existing in a year

Use Prevalence and US Population to calculate # of Existing Patients Diagnosed and Treated

Incidence of the disorder = 5% representing newly diagnosed patients each year

Use Incidence and US Population to calculate # New Patients Diagnosed and Treated in a year

Total # of Patients Diagnosed and Treated with RX= Existing + New Patients Diagnosed and Treated in a year

# of Patients Captured in Market Share = 25% of treated patients are getting your pharmaceutical

Calculate Gross $ Captured Per Treated Patient per year based on $35 per month gross $ per Patient

Calculate Gross $ Lost Due to Discounts and Chargebacks at 2% of Gross Sales

Use Gross $ Captured and Gross $ Lost to calculate Total Net $ for your product in each year

Be sure to write a statement of what the forecast means to a product manager and put it in the Excel Spreadsheet and format your cells properly.