What Capacity Problems Are Encountered When A New Drug

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What Capacity Problems Are Encountered When A New Drug

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The first 2 problems are the high capital cost of capacity and the opportunity cost of restricting investments in other facilities. These problems are exacerbated by uncertainty over patent infringement, competitor's response and that there is only a 45% probability of launching the product. If the product is launched it is possible to lose sales because there is not sufficient capacity to meet customer demand. The estimates of demand varied by 600% and if actual sales are at the high end or the low end of the estimates the project will be a financial disaster unless the correct capacity decision is made.
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