To forecast pipeline revenue, a few more assumptions need to be made than just forecasting revenue of drugs that are already in production.

The main assumption that we need to make is how much of a share our new product is gonna take of the existing market, and also what are the likely profit margins on our particular product.

We're gonna start off by thinking about the market size as a whole, and then we can position our drug within that market size.

Pervi, they have a drug called Doria in their pipeline, which is a schizophrenia drug.

So we could look to a forecast the size of the schizophrenia market and using information produced by the company themselves.

They're estimating that in 2019, the total size of the schizophrenia drug market is $9.5 billion.

The information produced by the company suggests that US takes 65% of the market share.

So 65% of that total, $9.5 billion, giving us 6.2 billion as the size of the schizophrenia drug market in the us.

And then Europe's gonna take the remaining chunk of the market remaining 35%.

And therefore, in dollar terms, the size of the schizophrenia drug market in Europe is $3.3 billion.

But when we're forecasting revenues for our product, we might need to be a bit more specific than just the general kind of product that the drug is.

And Doria is a long-acting injectable drug.

This market already exists within the schizophrenia drug markets.

And information produced by the company suggested that in 2019, the size of the market was $5.8 billion.

So if we're trying to split this up into different geographies, we can see that there's 75% of the market is in the us, which gives us $5.2 billion of sales of long acting injectable schizophrenia drugs.

And in Europe, it's the remaining 27% of the market, giving us $1.6 billion of sales of long acting injectable schizophrenia drugs.

In 2019, we can now take this forward to forecast the size of the European long-acting injectable market through our forecast period.

We're going to forecast out the market size here for 11 years.

So if we take the market size that we calculated for the long-acting injectables European market, that'll give us $1.6 billion.

Roe V produces their accounts in Euros, so we're going to need to translate the 1.6 billion of dollars into Euros, and we're gonna also do that in millions of euros to begin with. So we're gonna multiply by a thousand and then divide by the Euro to US dollar exchange rate that we have here of 1.2.

So that's our calculation for the millions of euros for the market size of the European long-acting injectable market.

We can then forecast this forward through our Forecast period by taking that value and multiplying it by one plus the forecast growth rate.

Our growth rate for this European market has been estimated to be 6.5% for the first six years, and then declining to the end of our forecast period in 2030.