Assignment 1: Dr Narendran’s Dilemma

A report submitted to

Prof. Girija Shankar Semuwal

In partial fulfillment of the requirements of the

course Written Analysis and Communications - II

By
Atyant Yadav
Section E
Roll no. 2111058

And

Parul Sagar
Section E
Roll no. 2111207

On
16-10-2021

LETTER OF TRANSMITTAL
From
Atyant Yadav

To
Dr Narendran
Indian Medical (Siddha) College
Chennai, Tamil Nadu

Date: 16th Oct, 2021

Subject: Siddha Formulation- Analyzing the Patenting

Dear Dr Narendran

I have looked at the various data points provided by you and analysed the options available
considering the objectives regarding the patenting of the formulation by Dr RamKumar. I
have come up with 3 alternatives and the various perspectives around each of them. I have
concluded with them and enclosed my workings.

Yours sincerely,
Atyant Yadav

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EXECUTIVE SUMMARY
This case is about IMC which is an acronym for Indian Medical College’s faculty and it has
researched a new formula which is cost efficient, herbo mineral Siddha non invasive
cardiovascular product for coronary atherosclerosis. They are confused whether to file a
patent and commercialize the new formula that has been researched by the faculty members.
The faculty members are in favour of filing the patents as it will help in more visibility and
recognition. However Dr. Narendran is a bit skeptical because over the past 32 years, they
have let sponsor’s and publications use their research and it has worked for them. After
analysing the effect on profitability, recognition and reputation there were three options,
which were derived. The most feasible option being in which IMC is selling and
transferring all rights of the patent in a one time fee to a third party

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TABLE OF CONTENT
 Executive Summary 03 Situation analysis 05 Problem
statement 06 The Options 06 Criteria for Evaluation 06
Evaluation of Options 07 Recommendation 08 Action Plan
08 Exhibits 09

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SITUATION ANALYSIS

Dr. Narendran is in a dilemma, as Associate Professor and Head of Pharmacology

Department, Dr. Ramkumar has come up with his own research. As an individual, Dr
Ramkumar is an extremely good practitioner but he is reluctant to give knowledge. Dr.
Narendra however is entirely a different person, he is least concerned about profit and money
making. His priority is to develop and give more recognition to the Siddha system. Their key
focus has been on educating people about the Siddha system and providing Siddha medical
care instead of filing patents and commercializing their research work. They take active
interest towards the society by providing IPD patients with free treatment and diet.
After a joint meeting of the heads of 6 departments, it was concluded that the textual research
needs to be backed by sufficient research around therapies and drugs so that the other
branches of medicine accept the findings.
The institute is also looking at the situation from a globalisation perspective and relating the
perspective to how well Dr RamKumar’s research fulfills them. Amidst these thoughts, Dr
Narendran is also attentive to the fact that he needs to motivate faculty members putting in
time and effort in doing research in different areas of medicine.
To settle this issue, Dr Narendran has reached out to a management education institute to help
him analyse the problem with respect to commercialization. They have described the
patenting process and summarised the process with 3 different ways of proceeding with the
licensing of the research.
Dr Narender has to now decide amongst the options given and decide on the patenting
situation from a broader perspective, and act in the best interest of the stakeholders.

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PROBLEM STATEMENT

Dr Narendran has to decide the best possible criterion for all stakeholders from the feasible
options available to them with respect to the patenting and commercialization of the
medicinal research done by Dr RamKumar

OPTIONS

a. The selling of patent on a scheme of one time fee to a third party/ organisation b.
Outsourcing the manufacturing to a pharmaceutical company post obtaining patent
meanwhile looking at their marketing themselves
c. Entering into a contract with an entrepreneur post obtaining the patents and going
ahead with a royalty based model for the sales of the products

CRITERIA OF EVALUATION

The final decision to be taken by Dr Narendran can be based on the following points

1.The financial gain post the commercialization of patent, as it can potentially be a big
revenue generator for IMC
2.The recognition of Siddha system amongst various other systems of medicine 3.The
objective of IMC is to promote medical treatment, its research and Siddha knowledge. 4.The
resources at IMC were lacking in terms of Marketing and Legal aspects, which were
important to handle the production of the research’s outcome
5.The patent will ascertain Siddha science academically and motivate other researchers to
work similarly and bring more fame to IMC

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EVALUATION OF OPTIONS

OPTION 1
Selling the license on a one time fee to a pharmaceutical firm would yield a profitability of
50,000 at a probability of .7 and there’s a probability of .3 for the profit to be 75000.
1.This option will give an expected ROI of 230%, which is the highest amongst the three
alternatives available
2.Since this will be the first time a patent is going to be registered for Siddha system, this will
help Siddha system gain recognition internationally
3.As there is going to be a lot of recognition for Siddha system it will help IMC carry the
vision they have for Siddha.
4.This will also help them get rid of the legalities and marketing as an external firm will take
care of the product marketing. Instead IMC can allocate the time in new developments. 5.As
Dr. Ramakumar is getting a patent to his name, since his research is going to be used in the
market. It will encourage other practitioners to look at the vision IMC has and encourage the
academic integrity IMC focuses on.
OPTION 2

1. As in the Exhibit II: The ROI comes out to be 202% which isn’t the highest amongst
the three options
2. This will fulfil as this will allow them to mass manufacture their products to the
market
3. As the products get mass manufactured it will increase the number of people getting
treated by IMC, however IMC is a medical institute and it may not fare well with
marketing of their product
4. Since they have little to no experience with marketing and legal matter, this is an area
of concern and it may not fulfil
5. This stays the same as the first option and hence will be fulfilled

OPTION 3

1.Referring to Exhibit 3 the ROI is the least in this case

2. This will help Siddha system get recognition as their products will go in the
market 3. This criteria will be fulfilled with the products launching in the market 4.
Since IMC is working with an entrepreneur on royalty basis they will have to take
care of legalities which shouldn’t be the priority for them
5. Dr. Ramkumar will get the patent to his name and hence the criteria will be fulfilled

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RECOMMENDATION

Upon analysing all 3 options available for Dr Narendran with respect to the criterion of
evaluation, going with the 1st option: selling the patent on a scheme of one time fee to a third
party/ organisation seems best.

ACTION PLAN

1. Invite interested organizations in buying the patent

2. Check their background, their financial situation in recent years and their historical
reputation in medical field
3. Choose the organisation which most matches the vision of the IMC and has experience in
similar systems of medicine.
4. Reassure Dr RamKumar and share the formulation of the research with the chosen
organization
5. Discuss the paperwork with the legal firm and ensure the thoroughness of all clauses
considering the objectives of IMC
6. Plan ahead to deal with any collapses in the implementation like disagreements in pricing,
insignificant acceptance of the medicine

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EXHIBITS

Exhibit I:
Return of interest and profit calculation for option 1
Expected value received = 0.7*50,000+0.3*75,000 = 57,500
Assuming the cost of licensing to be Rs.25000, ROI = 230%

Exhibit II:

Profit and Return of interest calculation for option 2

Year 1 Year 2 Year 3 Year 4 Year 5

Sales 100000 80000 65000 40000 32000

Cost 96000 60000 45000 30000 28000

 Profit 4000 20000 20000 10000 4000

Total profit assuming discount rate to be 5% = 50588

Assuming the cost of licensing to be Rs.25000, ROI = 202%

Exhibit III:
Profit and Return of interest calculation for option 3
Year 1 Year 2 Year 3 Year 4 Year 5

Gross sales 250000 220000 200000 150000 100000

Royalties at 15000 13200 12000 9000 6000

6 %

Total profit assuming discount rate to be 5% = 48,730

Assuming the cost of licensing to be Rs.25000, ROI = 195%

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