What is market potential?
Market potential refers to the total possible commercial opportunity for a pharmaceutical product based on factors such as disease prevalence, addressable population, treatment rates, pricing, and market access conditions. It provides an estimate of the maximum value that could be captured under ideal circumstances, assuming full uptake in the eligible population. Market potential assessments typically incorporate epidemiological data, competitor analysis, payer constraints, and regulatory considerations.
Why is market potential important in pharmaceutical planning?
Understanding market potential is critical for informing investment decisions, clinical development strategy, and launch planning. It helps companies prioritize indications, forecast revenue, and allocate resources effectively. Market potential estimates also support business case development, portfolio optimization, and conversations with internal and external stakeholders, including investors and strategic partners. Accurately assessing market potential reduces risk and improves confidence in both pipeline and commercial decisions.
