Sunday, November 23, 2014 4:21:52 AM
The forecast for the Test strips market for the year 2017 is over 11 billion.
According to GlobalData, the USA monitoring market will reach $12.2 billion by the year 2017. As a point of reference, in 2010, the test strips themselves accounted for close to 90% of the total market value. Therefore, over $11 billion will be up for grabs in 2017 on the sale of test strips alone.
As we know, Lifescan owned by Johnson and Johnson controls 26.5 % of this market or translated back to 2017 $’s 2.9 billion.
Every business man, entering a market with a similar product of quality but lower pricing works out a probability study that shows him the possible potential of market penetration. Nothing unique, it is done every day and in every industry. That is how market works.
If DECN would be satisfied with 5 % through the channels available to them the figure then in play would be $ 145 Mio with a 20 % margin = 29 Mio net profit.
Do you think, J&J would have taken all the pain to go after DECN if they would not have come to the conclusion, that DECN could grab a minimum of 5 %? Why spend millions in litigation and risk your reputation in the markets with the risk of getting hit in court, when they cannot put a value to this case? This is not how it works in the board-rooms of companies. Such Kind of expenses have to be well explained.
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