“Time Is Money” — FDA Fast Track is Perfect Biotech Catalyst
Time, as they say, is money.
The longer it takes a biotech to get a drug to market, the more expensive the process becomes. This is especially true for a development-stage company, which must pay all of its operating expenses even though it doesn’t generate revenues.
But for patients, time isn’t just money — it’s also life.
During the years it can take to bring a lifesaving new drug to market, people can die. Over time, Congress has reformed the FDA to make it faster to move these drugs through the development and regulatory approval process.
One FDA program is called Fast Track. The program is designed to facilitate drug development and expedite drug review. When a company’s drug receives this status, communication frequency with the FDA is increased and happens earlier on in order to resolve problems quickly.
Fast Track can help shave months off bringing a therapy to market — and sometimes years.
But the program is reserved for drugs that treat a serious or unmet medical need. The drug also has to show superiority over existing therapies by improving efficacy, reducing side effects or being able to address an emerging health care need.
Overall, it’s a good sign when a drug is fast-tracked. It means the experts at the FDA have reviewed a biotech’s application and agree its therapy has potential to be a game-changer in treating a serious health problem.
Fast Track opens the door to Priority Review status, meaning the FDA could expedite the review process once a new drug application is submitted. It also means that the regulator might accept a filing with only partial data, to be completed as the review process advances, known as rolling review.
For patients, Fast Track means the potential for quicker availability of an important new drug. For investors, it translates into the potential for faster development and therefore, quicker profitability.
Take Ovid Therapeutics Inc. (NASDAQ: OVID), for example.
OVID is a biopharmaceutical company developing medicines to treat rare neurological diseases.
On March 15, the company announced the FDA granted them Fast Track designation for their treatment of Fragile X syndrome.
According to the NIH National Library of Medicine, Fragile X syndrome is a genetic condition that causes developmental problems including learning disabilities and cognitive impairment.
Affected individuals have delayed development of speech and language by age 2. And about one-third of individuals with Fragile X syndrome have features of autism spectrum. Seizures also occur in about 15% of males and about 5% of females.
Amit Rakhit, MD, MBA, chief medical and portfolio management officer of Ovid Therapeutics, in a press release notes:
Fragile X syndrome continues to have a high unmet medical need and has no FDA-approved therapies available. Fast Track designation enables us to work closely with the FDA to accelerate our efforts to potentially provide an impactful therapy to people with Fragile X syndrome.
News of the Fast Track designation gave OVID shares a nice bump.
Not bad for a two-day flier.
OVID also completed its first FDA Phase 1 safety trial, gaining the needed approval to move on to Phase 2 testing. The point being another nice jump could be on the horizon.
I’ll be keeping my eyes peeled for the next big catalyst. More on this story soon.
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