If I invest $30 million dollars in R&D for a new machine and If I conduct the R&D, you believe that there is a 10% chance that the research will produce a useful machine. If the research is successful, investment in the drug will require an windfall of $1.2B USD. The machine will likely generate annual profits of $200 million (starting a year after the windfall of $1.2 billion) for 10 years until the machine expires and becomes IP available for all to make. After that, it will generate a cash flow in perpetuity equal to $15 million. The discount rate is 6%.

If you invest in R&D, you estimate that it will take 3 years to know whether the machine is successful or not. What is the NPV of the R&D investment?