Guidant: Radiation Therapy
Case-Study Guidant
1.How attractive is the radiation therapy opportunity for Guidant?
First we will determine the size of the market and its growth potential. Then we will assess the attractiveness of the market for radiation therapy in general using the concept of Porter's 5 forces. Furthermore we will connect this information with Guidant's specifics and its complementary assets to find out if this specific market is attractive for the company.
Market size and growth potential
The market's size is yet unknown, because, as with many new technologies, it is just now taking shape. In table A on page 14 of the case, a matrix of different growth scenarios together with different developments regarding the dominant technology can be seen. If we take Ginger Howard's statements on the potential of the technology and the larger mental barriers of patients to leave radioactive material in their body for a long period of time, it seems most likely, that the market will be dominated by non-stent products and that it will become very large, namely between 636 million and 1.73 billion dollars. Concerning the markets growth potential, one can take a look at comparable markets and how they performed in the past. As can be seen in exhibit 1 page 16 of the case, the market for coronary angioplasty (which is fitting because it is a low invasiveness technique as well and because both markets will be strongly interconnected in the future) has been growing since 1990. Radiation therapy can be seen as a complementary service to CA. Therefore this trend will most probably also affect it. Furthermore heart disease-rates are continuously increasing and becoming a larger concern to society, which may help to overcome scepticism and increase the market's growth potential. The above information shows quite clearly that the market for radiation therapy is potentially very large and has great potential for growth.
Further market analysis
As a next step we will now identify and
1.How attractive is the radiation therapy opportunity for Guidant?
First we will determine the size of the market and its growth potential. Then we will assess the attractiveness of the market for radiation therapy in general using the concept of Porter's 5 forces. Furthermore we will connect this information with Guidant's specifics and its complementary assets to find out if this specific market is attractive for the company.
Market size and growth potential
The market's size is yet unknown, because, as with many new technologies, it is just now taking shape. In table A on page 14 of the case, a matrix of different growth scenarios together with different developments regarding the dominant technology can be seen. If we take Ginger Howard's statements on the potential of the technology and the larger mental barriers of patients to leave radioactive material in their body for a long period of time, it seems most likely, that the market will be dominated by non-stent products and that it will become very large, namely between 636 million and 1.73 billion dollars. Concerning the markets growth potential, one can take a look at comparable markets and how they performed in the past. As can be seen in exhibit 1 page 16 of the case, the market for coronary angioplasty (which is fitting because it is a low invasiveness technique as well and because both markets will be strongly interconnected in the future) has been growing since 1990. Radiation therapy can be seen as a complementary service to CA. Therefore this trend will most probably also affect it. Furthermore heart disease-rates are continuously increasing and becoming a larger concern to society, which may help to overcome scepticism and increase the market's growth potential. The above information shows quite clearly that the market for radiation therapy is potentially very large and has great potential for growth.
Further market analysis
As a next step we will now identify and