Licensing agreement-zenith lab for drug under development

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Reference no: EM13826882

Roche Pharmaceuticals entered into a licensing agreement with Zenith Lab for a new drug under development. Roche will receive $6,750,000 if the new drug receives FDA approval. Based on prior approval, Roche determines that it is 85% likely that the drug will gain approval. The transaction price of this arrangement should be

a. $6,750,000.

b. $5,737,500.

c. $1,012,500.

d. $0 until approval is received.

Reference no: EM13826882

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