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Although the old adage says lightning never strikes the same place twice, it did so in the area of ED drugs. In the mid-1990s, the biotech firm Icos wasdeveloping a new treatment for hypertension. Code-named IC-351, the drug moved quickly to clinical trials because of encouraging lab results. Then,unexpected things happened. First was the unusually high compliance rate of patients who took the medication required by the trial, especially males intheir 50s, despite the fact that IC-351 turned out to be ineffective in treating hypertension. The second surprise was that many male patients refused toreturn their surplus pills. The reason: their improved sex life. Icos’ IC-351 had failed to treat hypertension but succeeded in treating ED. Marketed as Cialis,it is a major competitor to Viagra, and its success led Lilly to acquire Icos for over $2 billion.The competition in the ED market is becoming more intense, however, because Pfizer’s patent on Viagra is set to expire in 2020. In the meantime, thepharmaceutical company Teva will begin manufacturing and selling a generic version of Viagra in late 2017 under a deal it signed with Pfizer. Lilly’s patenton Cialis is set to expire in late 2017. Lilly is working with the pharmaceutical company Sanofi on a deal that would make Cialis available over-the-counter,and thus the drug could be purchased without a prescription.Sources: This minicase is based on: “A plan to sell Cialis, an erectile drug, over the counter,” The New York Times,May 28, 2014; “Pfizer and Teva settlelitigation over Viagra generic,” The Wall Street Journal,December 17, 2013; “Eli Lilly says Icos acquisition complete,” Reuters,January 29, 2007; Deeds, D.L.,and F.T. Rothaermel (2003), “Honeymoons and liabilities: The relationship between alliance age and performance in R&D alliances,” Journal of ProductInnovation Management20, no. 6: 468–484; and Mestel, R. (1999), “Sexual chemistry,” Discover, January: 32.
17.Award: 1.00 pointPfizer’s and Icos’ decision to move forward with Viagra and Cialis as treatments for a different medical issue other than the issue they were initiallyintended for is an example of which type of strategy?Realized strategyEmergent strategyIntended strategyBusiness strategyCorporate strategyThe firms switched gears and moved to market their drugs in a different area, which was an unplanned strategic initiative. This action is consistent withthe definition of an emergent strategy.ReferencesMultiple ChoiceDiﬃculty: 1 EasyLearning Objective: 02-06 Evaluate top-down strategic planning,scenario planning, and strategy as planned emergence.