Tengion: Bringing Regenerative Medicine to Life

Tengion is a young biotech company that is at the frontier of regenerative medicine—a nascent field that seeks to promote the creation of new cells and tissue to repair or replace tissue or organ function lost due to age, disease, damage, or congenital defects. In late 2008 Tengion management faces a difficult dilemma. In light of the financial crises, the company needs to manage cash burn by prioritizing its R&D efforts. CEO Nichtberger needs to recommend to the board which of two promising new medical treatments to keep developing while placing the other on hold. In comparing the two options, a host of factors need to be considered—these range from assessing the regulatory challenges, manufacturing challenges, marketing challenges (in particular pricing), and partnering challenges. Each of the treatments would target a unique patient population that differs in both size and composition. Tengion must also consider how quickly it might expect to bring each of the two treatments to market. The decision could have significant long-term implications for the company's ultimate survival and success.