I. ProblemiNucleon is a small biotech start-up with a very promising potential product (CRP-1), which is also the first product Nucleon plans to bring to the clinical market. Nucleon has reached the human clinical trial stage with its product and does not have manufacturing facilities that meet the guidelines for such clinical trials and testing. Nucleon is on the verge of making a critical choice on manufacturing strategy, which will affect Nucleon's survival in the intense long-term competition. Nucleon management understands that it has a limited budget to start with, that the financial environment in the biotechnology industry is changing rapidly, and establishing the safety and efficacy of products like CRP-1 is complex, time-consuming and time-consuming and expensive; that's why they want to evaluate the risks and benefits of each production strategy before making the final decision.II. AlternativesBefore moving into the clinical testing phase, Nucleon management is evaluating the advantages and disadvantages of the company's 3 main manufacturing strategies. For Phases I and II these options are 1) build a new 5,000 m2 pilot plant that supplies the CRP-1 needed for Phases I and II, 2) contract clinical manufacturing to an external company, and 3) license manufacturing to another biotechnology company or pharmaceutical company. If CRP-1 succeeds in the first two phases, there are two more options available to the company for Phase III, namely 1) vertical integration with commercial marketing and 2) licensing of manufacturing and marketing.III. Problems The main problem for Nucleon is the current availability of capital. They only have $6.5 million on hand when evaluating these options. Nucleon doesn't have the ability to go to the pub... middle of paper... get to nowhere. Nucleon's core competencies are in carrying out adequate scientific research with its team of experts and their strong link with academia leading to technical prowess; therefore, they should focus on continuing their scientific experience. If they choose not to license the product early on and CRP-1 succeeds in Phase I and II, I recommend Nucleon invest in a plant to supply the market of their own if they can find external support from investors. With the solid Phase I and II test results, I believe Nucleon can build investor confidence and gain initial investment. The expected return on this investment is very high compared to licensing the product at this stage. However, if they do not find external support, they can still license the product to Phase III and enjoy immediate cash flow followed by royalty payments.