Question;3. Case Problem ? Assigning Doctors to Medical Research Projects (The professor will offer the firstExcel Model to answer the first question. Your job is to build from there and answer the remainingquestions.)Project PickingsTazer, a pharmaceutical manufacturing company, entered the pharmaceuticalmarket 12 years ago with the introduction of six new drugs. Five of the six drugswere simply permutations of existing drugs and therefore did not sell veryheavily. The sixth drug, however, addressed hypertension and was a hugesuccess. Since Tazer had a patent on the hypertension drug, it experienced nocompetition, and profits from the hypertension drug alone kept Tazer inbusiness.During the past 12 years, Tazer continued a moderate amount of research anddevelopment, but it never stumbled upon a drug as successful as thehypertension drug. One reason is that the company never had the motivationto invest heavily in innovative research and development. The company wasriding the profit wave generated by its hypertension drug and did not feel theneed to commit significant resources to finding new drug breakthroughs.Now Tazer is beginning to fear the pressure of competition. The patent for thehypertension drug expires in five years, and Tazer knows that once the patentexpires, generic drug manufacturing companies will swarm into the market likevultures. Historical trends show that generic drugs decrease sales of brandeddrugs by 75 percent.Tazer is therefore looking to invest significant amounts of money in researchand development this year to begin the search for a new breakthrough drugthat will offer the company the same success as the hypertension drug. Tazerbelieves that if the company begins extensive research and development now,the probability of finding a successful drug shortly after the expiration of thehypertension patent will be high.As head of research and development at Tazer, you are responsible for choosingpotential projects and assigning project directors to lead each of the projects.After researching the needs of the market, analyzing the shortcomings ofcurrent drugs, and interviewing numerous scientists concerning the promisingareas of medical research, you have decided that your department will pursuefive separate projects, which are listed below.Project Up:Develop a more effective antidepressant that does not cause seriousmood swingsProject Stable: Develop a drug that addresses manic-depression.Project Choice: Develop a less intrusive birth control method for women.3Project Hope:Develop a vaccine to prevent HIV infection.Project Release: Develop a more effective drug to lower blood pressure.For each of the five projects, you are only able to specify the medical ailmentthe research should address since you do not know what compounds will existand be effective without research.You also have five senior scientists to lead the five projects. You know thatscientist are very temperamental people and will only work well if they arechallenged and motivating, you have established a bidding system for theprojects. You have given each of the five scientists 1,000 bid points. Theyassigned bids to each project, giving a higher number of bid points to projectsthey most prefer to lead.The following table provides the bids from the five senior scientists for the fiveindividual projects:ProjectProject UpProject StableProject ChoiceProject HopeProject ReleaseDr. Kvaal100400200200100Dr. Zuner020080000Dr. Tsai100100100100600Dr. Mickey2671539945130Dr. Rollins100333334800You decide to evaluate a variety of scenarios you think are likely.1In general, patents protect inventions for 17 years. In 1995, GATT legislation extending theprotection given by new pharmaceutical patents to 20 years became effective. The patent forTazer?s hypertension drug was issued prior to the GATT legislation, however. Thus, the patentonly protects the drug for 17 years.a. Given the bids, you need to assign one senior scientist to each of the fiveprojects to maximize the preferences of the scientists. What are theassignments?b. Dr. Rollins is being courted by Harvard Medical School to accept a teachingposition. You are fighting desperately to keep her at Tazer, but the prestigeof Harvard may lure her away. If this were to happen, the company wouldgive up the project with the least enthusiasm. Which project would not bedone?c. You do not want to sacrifice any project since researching only four projectsdecreases the probability of finding a breakthrough new drug. You decidethat either Dr. Zuner or Dr. Mickey could lead two projects. Under thesenew conditions with just four senior scientists, which scientists, will leadwhich projects to maximize preferences?4d. After Dr. Zuner was informed that she and Dr. Mickey are being consideredfor two projects, she decided to change her bids. Dr. Zuner?s new bids foreach of the projects are the following:Project Up:20Project Stable:450Project Choice:451Project Hope:39Project Release:40Under these new conditions with just four senior scientists, which scientistswill lead which projects to maximize preferences?e. Do you support the assignments found in part d? Why or why not?f. Now you again consider all five scientists. You decide, however, that severalscientists cannot lead certain projects. In particular, Dr. Mickey does nothave experience with research on the immune system, so he cannot leadProject Hope. His family also has a history of manic-depression, and youfeel that he would be too personally involved in Project Stable to serve as aneffective project leader. Dr. Mickey therefore cannot lead Project Stable.Dr. Kvaal also does not have experience with research on the immunesystem and cannot lead Project Hope. In addition, Dr. Kvaal cannot leadProject Release because he does not have experience with research on thecardiovascular system. Finally, Dr. Rollins cannot lead Project Up becauseher family has a history of depression and you feel she would be toopersonally involved in the project to serve as an effective leader. BecauseDr. Mickey and Dr. Kvaal cannot lead two of the five projects, they eachhave only 600 bid points. Dr. Rollins has only 800 bid points because shecannot lead one of the five projects. The following table provides the newbids of Dr. Mickey, Dr. Kvaal, and Dr. Rollins:ProjectProject UpProject StableProject ChoiceProject HopeProject ReleaseDr. Mickey300Can?t lead125Can?t lead175Dr. Kvaal86343171Can?t leadCan?t leadDr. RollinsCan?t lead5050100600Which scientists should lead which projects to maximize preferences?g. You decide that Project Hope and Project Release are too complex to be ledby only one scientist. Therefore, each of these projects will be assigned twoscientists as project leaders. You decide to hire two more scientists in order to staff all projects: Dr. Arriaga and Dr. Santos. Because of religiousreasons, neither of them want to lead Project Choice and so they assign 0bid points to this project. The following table lists all projects, scientists,and their bids.5ProjectKvaal Zuner Tsai Mickey Rollins Arriaga SantosUp 86 0 100 300 Can?t lead 250 111Stable 343 200 100 Can?t lead 50 250 1Choice 171 800 100 125 50 0 0Hope Can?t lead 0 100 Can?t lead 100 250 333Release Can?t lead 0 600 175 600 250 555Which scientists should lead which projects to maximize preferences?h. Do you think it is wise to base your decision in part g only on an optimalsolution for a variant of an assignment problem?
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