Selected market modeling terms

Probability of launch P(Launch) - the probability, expressed as a number from 0 to 1, that a product under development will enter the market.

Market segmentation - a predefined subset of a broad population of patients, physicians, procedures, regions, facilities or other divisions that are of interest to analyze or report separately from other subsets. Often a segment is created because the particular group (e.g., surgeon physicians) are assumed to have a differential adoption profile, than another segment (medical physicians). Sometimes a segment is created as an organizing or reporting convenience.

Exclusions - percentage of a market segment that is excluded from the target pool.
Logistical - exclusions based on inability to access care. E.g., ability to   travel to or pay for treatment.
Clinical - exclusions based on inappropriateness or contraindication for a treatment or diagnostic.

Target pool - those patients, physicians, procedures, or facilities who could adoption a new technology. The subset of a market segment after reductions associated with logistical and clinical exclusions.

Technology adoption
Organic adoption - the theoretical adoption curve projected without any consideration of potential disruptions from new technologies. Expressed as a percentage of the target pool.
Disruption - the disruption to the organic curve expressed as a percent reduction.
Net adoption - the predicted technology adoption calculated by subtracting the technology disruption from the forecasted organic adoption.

Product profiles
Target product profile -  a set of product attributes (e.g., specifications, performance, indications, price, side effect profile) that is assumed to describe the commercialized product.
Minimum product profile - the minimal set of product attributes that would be considered adequate to commercialize (i.e., launch) a product. This is the profile against which the P(Launch) is calculated.

Market share - the percentage of units sold associated with a single product or competitor.

Operational scenario - the forecast model based on management's operating assumptions.

Simulation forecast - a forecast model that strives to predict all possible future outcomes. This allows discussion of the probability that a forecast would far short of, or exceed any given level of performance. 

ROMR - Return On Money at Risk. A metric that describes the odds of an uncertain investment derived from a Monte Carlo simulation of the discounted cash flows (NPV) associated with that investment. A ROMR of 10 is interpreted as for each $1 placed at risk, the expected return is $10. A ROMR of 1 is equivalent to an average NPV of $0 at the cost of capital.

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