Who Wins? First Movers or Second Movers in Healthcare Innovations?

In many technology-facing innovations, second movers win.For example, a biotech was backed by a stunning $200 million in its Series A funding. It aims to reformulate existing blockbuster drugs, get them through the FDA clinical and production requirements quickly, and win market share by underpricing the existing drugs. [...]“Our price is going to be lower – so much lower that it’s not about a rebate or discount, it is a fundamentally lower price,” said the CEO, referring to payments drug makers offer to insurers from a therapy’s list price to secure coverage. ( https://www.biopharmadive.com/news/eqrx-launch-alexis-borisy-drug-price-competition/570266/ )Ok – yet the price must be high enough to earn the promised profits implied by the massive VC investment.So the first mover does the heavy lifting R&D and the FDA clinical and production requirements, and the second mover follows, promising substantially lower prices.I wish them the best; but there are lots of “ifs” in this business model, including by passing or reducing the role of the insurer that now gets “rebates.”Nevertheless, if it works:*second movers can take considerable market share by underpricing*first movers will be motivated to price more carefully so they do not leave so much underpricing opportunity for the second mover and so they recoup as much of their costs as quickly as possible.BUT: There are first movers that are land grabs. These are hard to dislodge, especially in cost-cutting and consumer-facing innovations, e.g. software that is difficult to install and learn; tight consumer relations as, for example, with a beloved doctor; or an EMT or script for chronically ill people that cannot be easily moved to other providers.View original post and comments here