Millennium Pharmaceuticals, Inc. (A)

Stefan H. Thomke; Ashok  Nimgade

Case | HBS Case Collection | December 1999 (Revised August 2001)

Millennium Pharmaceuticals, Inc. (A)

Abstract

Focuses on Millennium's strategy to grow and revolutionize drug development through the use of new technologies such as genomics. Describes how Millennium Pharmaceuticals--a fast-growing biotechnology firm in Cambridge, MA--has used strategic alliances to finance the development of technology platforms based on the latest breakthroughs in genomics. As the firm considers developing pharmaceutical drugs itself, they face a number of challenges: 1) Can they revolutionize drug development by making it more predictable, faster, and less costly? 2) How should they select their alliances such that they move closer to becoming a pharmaceutical firm and still attract the funding needed for their strategy? 3) How can they continue to grow rapidly and attract and retain some of the best minds in the pharmaceutical industry?

Keywords: Cost Management; Financing and Loans; Medical Specialties; Retention; Growth and Development Strategy; Time Management; Product Development; Problems and Challenges; Alliances; Technology; Biotechnology Industry; Pharmaceutical Industry; Cambridge;

Language: English

Format: Print

24 pages

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Citation:

Thomke, Stefan H., and Ashok Nimgade. "Millennium Pharmaceuticals, Inc. (A)." Harvard Business School Case 600-038, December 1999. (Revised August 2001.)

Describes IDEO, the world's leading product design firm, and its innovation culture and process. Emphasis is placed on the important role of prototyping and experimentation in general, and in the design of the very successful Palm V handheld computer in particular. A studio leader is asked by a business start-up (Handspring) to develop a novel hand-held computer (Visor) in less than half the time it took to develop the Palm V, requiring several shortcuts to IDEO's legendary innovation process. Focuses on: 1) prototyping and experimentation practices at a leading product developer; 2) the role of playfulness, discipline, and structure in innovation processes; and 3) the managerial challenges of creating and managing an unusually creative and innovative company culture. Includes color exhibits.

In the fast-moving digital world, even experts have a hard time assessing new ideas. Case in point: At Bing, a small headline change an employee proposed was deemed a low priority and shelved for months until one engineer decided to do a quick online controlled experiment—an A/B test—to try it out. The test showed that the change increased revenue by an astonishing 12%. It ended up being the best revenue-generating idea Bing ever had, worth $100 million. That experience illustrates why it’s critical to adopt an “experiment with everything” approach, say Kohavi, the head of the Analysis & Experimentation team at Microsoft, and Thomke, an HBS professor. In this article they describe how to properly design and execute A/B and other controlled tests, ensure their integrity, interpret results, and avoid pitfalls. They argue that if a company sets up the right infrastructure and software, it will be able to evaluate ideas not only for improving websites but also for new business models, products, strategies, and marketing campaigns—all relatively inexpensively. This will help it find the right path forward, especially when answers aren’t obvious or people have conflicting opinions.

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Millennium Pharmaceuticals, Inc. (A)

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