Question: Genenco is developing a new drug that will slow the aging process. In order to succeed, two breakthroughs are needed, one to increase the potency
Genenco is developing a new drug that will slow the aging process. In order to succeed, two breakthroughs are needed, one to increase the potency of the drug, and the second to eliminate toxic side effects. Research to improve the drug's potency is expected to require an upfront investment of $10 and take 2 years; the drug has a 5% chance of success. Reducing the drug's toxicity will require a $7 up-front investment, take 5 years, and has a 15% chance of success. If both efforts are successful, Genenco can sell the patent for the drug to a major drug company for $3000. Use a 6% discount rate. Which research project should Genenco do first? Toxicity Potency O Doesn't matter
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