Small biotechnology companies are research intensive and develop chemical compounds that may prove to be useful drugs, but they typically do not have the funding or global reach to test the compounds for government approval or to market drugs worldwide. Instead, they sell the patents on the chemical compounds to large pharmaceutical companies to test and market. A pharmaceutical company has been buying patents from two biotechnology companies. The numbers of patents that led to successful and unsuccessful drugs during the past five years for three categories of drug are as follows:

a) Make a contingency table for number of successful patents with three rows for the three categories and two columns for the two companies, and give the row and column totals.

b) Make a table similar to (a), this time giving the proportion of successful patents in each cell of the table. For instance for genetic diseases, Company A had a proportion of 3/(3 + 15) = 0.167. Do NOT include row or column totals.

c) Draw a graph that compares the success rate from (b) of patents bought from Company A with those bought from Company B for each type of drug.

d) Company A says that it has provided 135 patents, of which 43 were successful, giving a success rate of 43/135 = 31.9%. The corresponding figure for Company B is 29.4%. Company A therefore claims to be more successful than Company B. If you were Company B, how would you respond to this claim?

e) If the pharmaceutical company wants to buy a patent, which biotechnology company is better for (i) genetic diseases, (ii) chemotherapy, and (iii) anti-inf lammatory? State the reason for your answer.

Transcribed Image Text:

Number of Patents Biotechnology Company A Biotechnology Company B Successful Unsuccessful Successful Unsuccessful Genetic Diseases 3 15 11 32 Chemo- therapy 26 10 35 Anti- inflammatory 35 51 11 10 Total 43 92 32 17