Investor Biotech Primer

Like all industries, biotech has its own jargon. Newcomers to the sector can find themselves struggling to get through just one paragraph of a press release without having to look up several terms.

Here is a primer on some of the key phrases, acronyms or statistical concepts that you'll need to know when investigating a biotech stock idea.

ANDA -- Abbreviated New Drug Application. This is an application to the Food and Drug Administration (FDA) to seek approval of a generic drug.

For example, last week Mylan Laboratories (MYL Quote) announced that its ANDA for generic Valtrex received tentative approval from the FDA. Valtrex, for the treatment of herpes, is made by GlaxoSmithKline (GSK Quote).

NDA -- New Drug Application. This application seeks approval for a new drug before commercialization. Included in the NDA is safety and efficacy data, proposed labeling and manufacturing methods.

IND -- Investigational New Drug. This is the process in which companies apply to the FDA for permission to begin trials of a new drug in humans. Pharmion (PHRM Quote) announced last week that the FDA accepted the company's IND for an oral version of Vidaza, a treatment for patients with myelodysplastic syndromes. The new drug will enter phase I trials shortly.