The biotechnology sector is a risky investment arena and investing in such companies requires a great deal of patience. Drug companies take years -- even decades and burn a tremendous amount of cash to bring a drug to the market.
Some drugs pass the FDA muster easily, while some struggle through the arcane process of regulatory approval. For a one-trick pony company, which does not have a safety net for failure of the lead compound, the FDA decision can seal the fate of the company.
However, despite the regulatory setbacks, some companies exude a steely determination to bring their drugs to market and their patience has been amply rewarded. Some of the recent classic examples are Dendreon Corp. (DNDN) and Vanda Pharmaceuticals Inc. (VNDA).
Two years after Dendreon's prostate cancer vaccine Provenge was rejected by the FDA, the drug has got a second chance now. Dendreon plans to refile for FDA approval in the fourth-quarter of this year. The stock, which hit a 52-week low of $2.55 on March 9, 2009, now trades around $19.
Vanda is yet other example of patience and an iron resolve. After initially being rebuffed by the FDA last year, Vanda's schizophrenia drug Fanapt (Iloperidone) made it across the finish line by winning the regulatory approval on May 6, 2009. The stock, which hit an all-time low of $0.45 on December 23, 2008, now trades around $9.
The following are the companies, which are expected to hear the FDA's decision on their drugs during this month.
Hemispherx Biopharma Inc. (HEB), which is awaiting FDA approval of its experimental drug Ampligen for chronic fatigue syndrome, set a new 52-week high of $1.50 on Friday. The FDA decision is due on May 25.
Over the past one-week alone, Hemispherx gained a whopping 160%. The current run up in stock price of Hemispherx can be attributed to the prospects of flu profits. The risk of a swine flu pandemic has boosted the share prices of anti-viral drug companies and Hemispherx is one among them.
Ampligen, which has earned the sobriquet, "a drug in search of a disease", is also in preclinical testing for avian flu in the U.S., Japan and Canada. On April 27, it was announced that the Japanese government is accelerating the Ampligen research program in human volunteers. The recent emergence of a new swine flu strain with high associated mortality in Mexico provides additional significance to the Japanese studies.
Hemispherx's collaborative partner in Japan, Biken Corporation has also successfully completed a series of animal/preclinical tests on Ampligen as an enhancer for seasonal influenza vaccine.
Ampligen has been pacing the sidelines for nearly four decades. Chronic fatigue syndrome, or CFS, for which Ampligen is being evaluated, is a condition in which patients have persistent or relapsing fatigue. There is neither a known cause, nor an effective treatment for CFS. According to the company, the global market for an effective CFS drug is worth over $1 billion. The CFIDS Association of America estimates that four million Americans suffer from chronic fatigue syndrome.
On May 31, 2009, Acusphere Inc. (ACUS.PK), a specialty pharmaceutical company will get to know the fate of Imagify for injectable suspension as cardiac imaging agent for the detection of coronary artery disease, the leading cause of death in the United States.
According to statistics, 16.0 million people in the United States suffer from coronary artery disease, or CAD.
The company submitted the New Drug Application, or NDA, of Imagify in April 2008 and in February 2009, submitted an amendment to its NDA. The amended indication is focused on patients undergoing pharmacologic stress techniques where the risk-to-benefit ratio of Imagify is more compelling than the broader indication that was originally filed.
The CAD is characterized by the accumulation of plaque and early identification and intervention are crucial to prevent it from becoming fatal. A key indicator of the presence of CAD is blood flow (perfusion) deficits in the heart muscle (myocardium).
The current standard for detecting perfusion deficits is through a Nuclear SPECT Stress Test (Nuclear Stress Test), which is expensive, time consuming and exposes patients and providers to radiation.
According to the company, Imagify, which is an ultrasound imaging agent, represents a rapid non-invasive means to identify the presence of CAD before a patient has an event without the use of radiation. Besides, Imagify is also less expensive than a nuclear stress test.
Since bottoming out at $0.02 on March 20, 2009, the shares have risen more than eleven-fold and currently trade around $0.23. Over the past 1 week alone, the stock gained an impressive 109%.
Arca biopharma Inc. (ABIO) is yet other company, which will be hearing the FDA's decision on its investigational chronic heart failure drug Gencaro (bucindolol) on May 31, 2009.
According to the company, Gencaro, a gene-specific heart failure prevention drug, targets certain genes that other heart medications do not.
If approved, Gencaro will be the first genetically-targeted cardiovascular drug. ARCA holds worldwide rights to Gencaro and, if it is approved, the company plans to commercialize the drug in the U.S., through its own specialized sales force. ARCA intends to seek commercial partners outside the United States.
A companion genetic test for Gencaro, developed by ARCA in collaboration with Laboratory Corp. of America Holdings (LH), is also under the FDA review. Targeted therapies use companion diagnostic tests. A companion diagnostic test refers to a specific test that assists physicians in selecting the right drug for the right patient.
Since hitting an all-time low of $2 on January 28, 2009, shares of Arca have gained nearly 400% and currently trade around $10.
According to reports, the FDA approved 24 new drugs (the first-of-a-kind drugs) in 2008, compared to 18 in 2007, 22 in 2006 and 20 in 2005.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.