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Role of risk and return in the pharmaceutical industry

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Reference no: EM133277709

1. What is the average time period for the introduction of a new drug into the market?

a. 2 years

b. 5 years

c. 8 years

d. 12-15 years

2. Discuss the role of risk and return in the pharmaceutical industry.

3. Regarding Cost Structure, discuss why marketing is so important for drugs who's profits have surpassed their point of fixed costs.

For example, Dave's Amazing Snake Oil Company has just reached the point where our fixed costs (the money expended for research, testing, and production) have been met for handsomia, a pill that causes me to become extremely handsome (like Dave himself). Dave decides to put more money into the advertisement of handsomia, which is a smart business decision. Why is it so smart?

Reference no: EM133277709

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