• Johnson & Johnson is evaluating the costs and benefits of a new pharmaceutical product with the following projections:
  • R&D Costs: $1 billion
  • Production Costs per Unit: $50
  • Selling Price per Unit: $100
  • Estimated Annual Sales: 20 million units
  • Fixed Costs: $500 million annually

• Requirements:
  1. Calculate the total annual revenue and production cost for the new pharmaceutical product.
  2. Prepare a break-even analysis for the new product.
  3. Analyze the profit margin per unit and overall for the new product.
  4. Discuss the strategic benefits of the new pharmaceutical product for Johnson & Johnson.
  5. Evaluate the regulatory risks and approval process for the new product.