Metabical: Pricing, Packaging, and

Demand Forecasting for a New Weight-

Loss Drug

Submitted by Group 07
ANANTHA VENKATA RAGHAVA GOPIDESI – H2022004
KRIPA MEHTA – H2022021
SAGAR S. NANDANWAR – H2022038
SHANU SINGH – H2022041
SHREEYASH KHAMBETE – H2022045
What are the pros and cons of the demand forecasting methods presented by Printup?
What is the demand forecast (unit) for the first five years?
Method Pros Cons
Does not account for all factors that
Forecast based influence demand, May underestimate
on overweight Simple to understand, Based demand if potential customers are not
individuals on a large population actively seeking weight-loss drugs
Based on direct feedback from May not be representative of the entire
potential customers, Accounts overweight population, Relies on self-
Forecast based for consumer interest in reported intentions, which may not
on CSP survey weight-loss drugs translate into actual behavior
Focuses on the most likely May be too optimistic, as it assumes all
Forecast based customers for Metabical, ideal target consumers will try Metabical,
on ideal target Assumes a higher penetration Does not account for potential changes in
consumer rate than the general population consumer preferences or market conditions

What are pricing strategies that Printup should explore? What are the advantages and
disadvantages of each strategy? What price would you recommend for the New Product
(drug)?

Pricing Strategy

There are three main pricing strategies that the company can explore:

• Competitive pricing: This strategy would involve charging more than the company's
closest rival, Alli. This would be a way to signal to consumers that Metabical is a
premium product. However, it could also price out some potential customers.
• Comparison pricing: This strategy would involve charging a price that is based on the
cost of other similar products on the market. This would be a way to ensure that
Metabical is priced competitively. However, it could also leave the company with a
lower profit margin.
• Value-based pricing: This strategy would involve charging a price that is based on the
value that the product provides to consumers. This would be a way to ensure that
Metabical is priced fairly for what it offers. However, it could be difficult to determine
the value of the product, and consumers may not be willing to pay a premium price.

Recommended Pricing Strategy

The recommended pricing strategy is to charge $125 for a 4-week plan. This price is based on
a comparison of Metabical to other similar products on the market. It is also a price that is
within reach of most consumers.

Packaging Strategy

The recommended packaging strategy is to supply Metabical in packs of 28, or enough for a 4-
week supply. This is because consumers would have better results if they took Metabical for a
full 12 weeks. Additionally, health insurance companies would not cover the cost of
Metabical, and the packaging should permit users to buy the medication once a month.
Customers should be able to purchase one pack for a four-week supply or three packs for the
entire 12-week course. This is because Metabical would cost more than comparable over-the-
counter medications for weight loss.

Blister-style packaging should also be used as a reminder to clients to refill their prescriptions.

What impact does your pricing have on profitability? What is the ROI for each of the
pricing strategies over the first five years?

Ideal Consumer Segment: Educated females, 35-65 of age with BMIs between 25 and 30 looks
to be the most attractive.

The financial calculations indicate that pricing the product at $125 for a 4-week supply will be
ideal as results show a forecasted 5-year gross profit margin of $859,858,960; The ROI in this
case is 75.94%. The ROI exceeds the initial expected minimum ROI value of 5% within five
years of the new product’s launch. Hence, the strategy employed in method 3 seems to be the
best and most romising because it is targeting a niche customer base and the pricing is based
on the research data of CSPs Outcomes Research Group.

Research also suggests that pricing Metabical-4 week supply at $150 was higher than what
consumers in the overweight category were willing to pay. Forecast method2 shows higher
profit margin than our proposed strategy on both price levels, $125 & $150 and their ROIs
seem attractive from the financial calculations. However, the method is relative to CSPs
existing product line success rate, which doesn’t seem like a viable option. A new product
entering the segment for the first time is influenced by current market state, existing
competition, and varied market dynamics. Hence, forecasting a new product based on older
product success might not be a reliable indicator to decide on a product launch strategy.

$75 Retail Price

ROI Method 1 64.17%

ROI Method 2 18.10%
ROI Method 3 24.94%

$125 Retail Price

ROI Method 1 16.01%

ROI Method 2 91.98%
ROI Method 3 74.94%

$150 Retail price

ROI Method 1 8.08%

ROI Method 2 147.03%
ROI Method 3 126.39%