Maximizing Value with Real Options: Unlocking the Potential of Research Investments
When allocating funds for research projects, traditional discount cash flow methods may fall short in capturing unforeseen opportunities. Real Options offers a dynamic approach, accounting for the serendipitous value that can emerge from research endeavors. This is crucial, considering blockbuster products like Rogaine and Viagra were discovered by chance. Real Options also evaluates the future options stemming from present decisions, adding a layer of strategic foresight.
Key Scenarios Explored:
- Pharmaceutical Licensing:
- Assessing the value of licensing a pharmaceutical product with multiple indications.
- Market Entry Strategy:
- Crafting a market entry plan for a new consumer product to maximize profitability.
- Solar Hybrid Plant Design:
- Mitigating competitive threats while designing a solar hybrid plant for optimal performance.
- Cannibalization Risk:
- Analyzing the risks and potential impact of cannibalization when merging two drug offerings.
Highlighted Discussion Points:
- Discounts for Non-Exclusive Options:
- Evaluating whether discounts should be applied to non-exclusive options to accurately assess their value.
- Managing Downside Risk:
- Utilizing real options to control downside risk effectively and safeguard investments.
- Navigating Uncertainties in R&D:
- Framing uncertainties inherent in research and development projects to make informed decisions.
- Impact of Delayed Investments:
- Understanding how the option to delay investments can influence overall value and strategic planning.
Course Leader: Gill Eapen, Founder and Managing Principal, Decision Options, LLC
Gill Eapen, an industry veteran and founder of Decision Options, has revolutionized decision-making processes in high-uncertainty industries like life sciences, energy, and technology. With extensive experience at Pfizer and Deloitte Consulting Group, Gill brings a wealth of expertise in financial analysis, strategic planning, and portfolio management.
Course Length: Approx. 1.0 hour
Join Gill Eapen in this insightful session to discover how Real Options can enhance decision-making processes and unlock hidden value in your research investments. Secure your spot now to gain invaluable insights into strategic planning and risk management.
