Question

Suppose you work for the FDA.. You are considering approval of a new cancer drug, called Drug A. Drug A in question would extend life by 16 months, however, it would cause side effects of nausea, pain, and hair loss, and seizures, which has a present value total cost of $100,000. a) Currently, this decision type is only considering one policy. Calculate the appropriate C/E. b) In reality there is currently a drug that can treat the cancer. The current drug only extends life by 12 months, but the side effects are only nausea, pain, and hair loss, which is valued at a present value total cost of $25,000. Calculate the average C/E of the current drug. c) If drug A is approved, only drug A will be sold. will be the only drug used to treat this cancer, thus this is a mutually exclusive policy. Given the stated decision type (mutually exclusive policy). Which C/E ratio should be calculated?

          Suppose you work for the FDA.. You are considering approval of a new cancer drug, called Drug A. Drug A in question would extend life by 16 months, however, it would cause side effects of nausea, pain, and hair loss, and seizures, which has a present value total cost of $100,000.
a) Currently, this decision type is only considering one policy. Calculate the appropriate C/E. 
b) In reality there is currently a drug that can treat the cancer. The current drug only extends life by 12 months, but the side effects are only nausea, pain, and hair loss, which is valued at a present value total cost of $25,000. Calculate the average C/E of the current drug. 
c) If drug A is approved, only drug A will be sold. will be the only drug used to treat this cancer, thus this is a mutually exclusive policy. Given the stated decision type (mutually exclusive policy). Which C/E ratio should be calculated?

Added by Katherine M.

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