Merck Serono Gains Deep Understanding of Product Portfolio Value-Drivers, Risks, and Sales Expectations Through Forecasting Solution
 
 

Merck Serono Gains Deep Understanding of Product Portfolio Value-Drivers, Risks, and Sales Expectations Through Forecasting Solution

  • Oracle Customer:  Merck Serono S.A.
    Location:  Geneva, Switzerland
    Industry:  Life Sciences
    Employees:  16,900
    Annual Revenue:  Over $5 Billion

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Merck Serono S.A. is the biopharmaceutical division of Merck KGaA. It offers leading brands in 150 countries to help patients with cancer, multiple sclerosis, infertility, endocrine and metabolic disorders, as well as cardiovascular diseases.

Merck Serono constantly analyzes its development portfolio (pharmaceutical products that are in clinical trials and not yet launched) to effectively determine the likelihood of favorable or unfavorable outcomes, for example to determine the level of confidence that sales targets for the next ten years can be met with the existing product portfolio.

As Merck Serono’s previous tools were insufficient to show the range of possible outcomes, based on technical and market risks and uncertainties, the company deployed Oracle Crystal Ball to make Monte-Carlo-based forecasts for worst-case, best-case and most-likely scenarios for its development portfolio. Using this solution, the company extended and improved the utility of its forecasts and gained the ability to take into account the correlative risks, synergies, and project interactions as it manages its product portfolio.

 
 

 
 

Challenges

A word from Merck Serono S.A.

  • “Oracle Crystal Ball enables us to make Monte Carlo simulations of the potential value and sales of our development portfolio. It is a very powerful tool for gaining a thorough understanding and improved awareness of value drivers, uncertainties, and risks, along with associated probabilities.” – Riccardo Lampariello, Associate Director, Merck Serono S.A.

  • Establish a better decision-making framework for its complex, development portfolio of pharmaceutical products, where single-point estimates or expected averages of portfolio values, portfolio risks, and sales forecasts are insufficient and can be misleading
  • Enable the company to be aware at all times of the range of possible outcomes of technical and market risks and uncertainties, such as the technical uncertainty of whether a product will produce the desired clinical outcomes, or the market-related uncertainty of whether a product will be outperformed by its competitors
  • Gain the ability to make improved forecasts by taking correlative risks and synergies into account when analyzing portfolio values, portfolio risks, and sales forecasts, as the success or failure of one product might affect other products in the portfolio

Solutions

Oracle Product and Services

  • Used Oracle Crystal Ball to devise a Monte-Carlo-based approach to better analyze and define the values and risks of the company’s development portfolio, laying the groundwork for optimized decision-making
  • Enabled a better understanding of the range of potential values and risks to improve portfolio planning
  • Enabled detailed analysis of the likelihood of favorable or unfavorable outcomes, such as the likelihood of whether Merck Serono can meet its sales targets planned for the next ten years with its existing product portfolio
  • Gained the ability to take into account correlative risks, synergies and project interactions, enabling Merck Serono to better forecast what the company may achieve—for example, that there is a 70% probability of a particular sales target being met
  • Established Monte-Carlo-based analysis using Oracle Crystal Ball as a useful element in decision-making at the board level, as the approach provides a better analysis of values and risks associated with the company’s product portfolio

Why Oracle

“We chose Oracle Crystal Ball to enable us to perform Monte Carlo analysis, which gives us a deeper understanding and improved awareness of the value drivers, uncertainties and risks of our portfolio of development projects,” said Kimber Hardy, head of valuation and analysis, Merck Serono S.A.

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