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Use the Table Below to Answer the Following Question(s) -Calculate Cumulative Net Profit at the Fourth Year

question 58

Multiple Choice

Use the table below to answer the following question(s) .
Dresden Pharmaceuticals has decided to go ahead and start clinical trials on a potential new drug.The total R&D costs are estimated to reach around $875,000,000 with clinical trials mounting to $145,000,000.The current market size is estimated to be around 3,000,000 and is expected to grow at 4 percent every year.The market share Dresden hopes to capture in the first year is 7 percent, and is projected to grow by 25 percent each year for the next 4 years.A monthly prescription is anticipated to generate revenue of $420 while incurring variable costs of $150.A discount rate of 8 percent is assumed.
$\begin{array}{l}\text { Dresden Pharmaceuticals }\\\begin{array} { | l | l | } \hline \text { Data } & \\\hline & \\\hline \text { Market Size } & 3,000,000 \\\hline \text { Unit (monthly Rx) revenue (\$) } & 420 \\\hline \text { Unit (monthly Rx) cost (\$) } & 150 \\\hline \text { Discount Rate ( per cent) } & 8 \\\hline & \\\hline \text { Project Costs } & \\\hline \text { R\&D (\$) } & 875,000,000 \\\hline \text { Clinical Trials (\$) } & 145,000,000 \\\hline & \\\hline\end{array}\end{array}$
-Calculate cumulative net profit at the fourth year.

Definitions:

Treatment Intensity

The degree of rigor or strenuousness of a given treatment, reflecting its duration, frequency, or depth of intervention.

Continuum of Care

A comprehensive approach in healthcare that spans a range of services from preventive care to rehabilitation, ensuring patient needs are met over time.

Treatment System

A treatment system refers to the organized network of services and providers that offer and manage healthcare and therapy for specific health issues or disorders.

Intense Treatment

Highly focused or extensive medical or therapeutic care aimed at aggressively addressing a condition or disease.