biogen

Businessmodel of Biogen

Customer Segments

Biogen has a niche market business model, with a specialized customer segment. The company targets its offering at consumers who have neurodegenerative diseases, hematologic conditions, and autoimmune disorders.

Value Proposition

Biogen offers four primary value propositions: innovation, accessibility, customization, and brand/status.

The company has embraced innovation from the very beginning. It developed Rituxan, the first monoclonal antibody to be approved as a cancer therapeutic, as well as Zevalin, another non-Hodgkin’s cancer drug that became the first radioimmunotherapy to enter the market.

The company creates accessibility by proactively trying to ensure consumers can use its therapies. It offers financial assistance tools for patients unable to afford the drugs, and in the U.S., it has launched programs that provide qualified underinsured or uninsured patients with products at no charge or a low cost, based on specified eligibility criteria. Lastly, it offers charitable contributions that may help commercially-insured patients with out-of-pocket costs associated with its products.

The company embraces customization by taking consumer opinions into account. It interacts with patients, healthcare societies, and advocacy organizations in order to identify unmet needs for its offerings. The conclusions from these discussions help shape programs, services, and applications.

The company has established a powerful brand due to its success. It is one of the oldest independent biotech firms in the world. The merger that formed it represented the largest biotechnology merger between two independent companies, and formed the third largest biotech firm in the world (though it has since lost that status). Lastly, it has won a number of honors, including recognition of its North Carolina manufacturing facility as “Facility of the Year“ at the FOYA Awards (2013).

Channels

Biogen’s main channel is its direct sales team. It also utilizes wholesale distributors, shipping service providers, and mail-order specialty distributors.

The company promotes its offering through its social media pages, advertising, direct mail, and participation in symposia and conferences.

Customer Relationships

Biogen’s customer relationship is primarily of a self-service nature.

Customers utilize its products while having limited interaction with employees. The company’s website provides answers to frequently asked questions and clinical resources for medical/healthcare professionals. That said, there is a personal assistance component in the form of phone and e-mail support.

Key Activities

Biogen’s business model entails designing, developing, and manufacturing its products. It utilizes third-party contract manufacturers for some of its products.

Key Partners

Biogen’s key partners are its contract manufacturers and its suppliers. The company also maintains partnerships with other organizations involved in research in order to leverage complementary technologies, skills, and areas of expertise. These partnership types are as follows:

Corporate Collaborations – Specific partners are as follows:

  • Adimab
  • AGTC
  • Centre for Therapeutic Target Validation (CTTV)
  • Eisai
  • BioFocus (subsidiary of Galapagos NV)
  • Ionis Pharmaceuticals
  • Samsung Biologics
  • Sangamo BioSciences

  • Telethon Institute for Gene Therapy (TIGET) Academic Collaborations – Specific partners are as follows:

  • University of Pennsylvania
  • MIT/Whitehead Institute for Biomedical Research
  • Harvard Medical School/Rubin Laboratory
  • ALS Consortium (includes Columbia University, Harvard University, and The Rockefeller University)
  • Duke University/Hudson Alpha Institute for Biotechnology
  • Columbia University
  • Lawrence Berkeley National Lab/University of Connecticut (Uconn) Health Center
  • Scleroderma Consortium (includes investigators from Tufts University, Yale University, University of Pennsylvania, University of Utrecht and the University of Glasgow)
  • Fibrosis Consortium (includes investigators from Harvard University, Yale University, University of Pennsylvania, University of California, San Francisco, and Boston University)
  • Sickle Cell Consortium (includes staff from the Montreal Heart Institute, Harvard University and St. Jude’s Hospital)
  • Epigenetics Consortium (includes experts at Harvard University, Washington University, College de France, Institut Curie, and MIT)
  • Accelerating Medicines Partnership (includes the National Institutes of Health, nine biopharma companies and various nonprofit disease foundations) Biogen actively invites other organizations to join it in partnership, with a particular interest in collaborating in the areas of neurology, hematology, immunology, and platform technologies.

Key Resources

Biogen’s main resources are its human resources, who include its engineering, process development, manufacturing, and quality teams.

The company operates manufacturing facilities in Research Triangle Park (RTP), North Carolina; Cambridge, Massachusetts; and Hillerød, Denmark. Combined they total 198,000 liters of bioreactor capacity, one of the largest such figures among biotech firms.

Cost Structure

Biogen has a value-driven structure, aiming to provide a premium proposition through frequent product enhancements.

Its biggest cost driver is sales/administration, a fixed cost. Other major drivers are in the areas of research and development (a fixed cost) and cost of sales, a variable expense that includes product and royalty costs.

Revenue Streams

Biogen has two revenue streams: product revenues and unconsolidated joint business revenues.

Written on October 25, 2017