Robert Moore, a recent graduate of a top-tier MBA program, now realized what it meant to be on the other side of a case study. It was December 2006 and Hyperion, the young biotech start-up of which he had recently become project manager, was faced with critical production choices. Moore and Jeff Hurst, the company's CEO, had met to discuss the situation, and over the next few weeks, Hurst was scheduled to present the company's manufacturing strategy to the board of directors. In the meantime, he asked Moore to evaluate Hyperion's options in detail and provide his recommendation. Hyperion's first potential product, "Cell Regulatory Protein-1" (CRP-1), had been undergoing extensive testing and analysis in the company's R&D laboratories for several years. The next major hurdle was human clinical trials, which typically took place over several years. However, before Hyperion could begin clinical trials, it had to decide how and where to produce CRP-1. To ensure participant safety, the U.S. Food and Drug Administration (FDA) has imposed strict guidelines; products tested on humans had to be made in facilities certified for "clinical grade" manufacturing. Because CRP-1 was the company's first product to enter the clinic, Hyperion did not have manufacturing facilities that met FDA requirements. It was faced with three options for supplying CRP-1 to the clinic: The first was to build a new 5,000-square-foot pilot plant with enough capacity to supply all the CRP-1 needed for phases I and II of the studies clinicians. The second option was to contract clinical manufacturing to an external company. And a third option was to license production to another biotech company or a pharmaceutical company. Under this third option, the licensee would be responsible for all manufacturing, clinical development and eventual commercialization of CRP-1. Each option had defined risks and benefits associated with it, and Moore knew that the one Hurst ultimately chose would have long-term consequences for Hyperion's survival in the highly competitive, high-risk pharmaceutical industry. Background: Hyperion was founded in 2001 by Dr. Alan Ball, an internationally renowned researcher at Children's Hospital and associate professor of clinical medicine at Greaves Medical Center, to develop pharmaceutical products based on a class of proteins known as cellular regulation. From 2002 to 2005, Dr. Ball and a small group of scientists who joined Hyperion studied ways to produce CRP-1 outside the human body. Although CRP-1 was a naturally occurring protein contained in human blood plasma, the amount that could be extracted was too small to be of any commercial use.