This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

FDA Advisory Panels: A Coin Flip

BOSTON ( TheStreet) -- Investors who think they can predict the outcome of U.S. Food and Drug Administration advisory panels this year might be better off just flipping a coin.

FDA advisory committees have become much tougher in 2010 with only a bit more than half of drugs taken in front of panels receiving positive recommendations, according to an analysis conducted by Concept Capital, the healthcare policy research arm of Sanders Morris Harris.

As of August 26, FDA advisory committees have recommended approval 12 out of 23 times, or a rate of just 52%, according to Concept Capital.

"The percentage of 'yes' recommendations is down significantly compared to 2009 and 2008, when 75% and 80% of drugs received positive recommendations," said Ramsey Baghdadi, an analyst with Concept Capital.

Notable "no" votes from advisory panels this year include Cell Therapeutics' (CTIC) lymphoma drug pixantrone, Vivus' (VVUS) obesity drug Qnexa, Acura Pharmaceuticals' (ACUR - Get Report) pain drug Acurox and Jazz Pharmaceuticals' (JAZZ - Get Report) fibromylagia drug JZP-6.

The 52% rate of positive votes is similar to the 50% rate in 2007, considered to be one of the worst regulatory periods for the pharmaceutical and biotech sectors in years, said Concept Capital, in its analysis.

So far this year, the Oncologic Drugs Advisory Committee has voted against approval for all three cancer drugs it has reviewed this year. Conversely, the Peripheral and Central Nervous System Drugs Advisory Committee has been the most amenable, recommending approval all three times for drugs from Questcor Pharmaceuticals (QCOR), Novartis (NVS) and Valeant Pharmaceuticals (VRX - Get Report).

Concept Capital's Baghdadi says FDA advisory panels have become more unpredictable for two main reasons: First, the FDA is bringing more drugs in front of advisory panels due to changes in FDA law that require most new drugs to be reviewed by outside experts. Second, stricter conflict of interest rules implemented by FDA have made it more difficult for the agency to recruit experienced panel members.

Despite the tougher stance at FDA advisory panels, Concept Capital believes the overall environment for drug approvals at FDA is improved compared to prior years.

Concept Capital limited its analysis to new molecular entities and major new indications for currently approved drugs that were reviewed by advisory panels attached to the FDA's Center for Drug Evaluation and Research.

A broader look at FDA advisory panel, including biologic drugs and those reviewed by other FDA divisions offers a bit more optimistic picture -- 15 "yes" votes from 27 panels, or a 56% rate.
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
QCOR $93.60 1.65%
CTIC $0.34 0.00%
ACUR $2.17 0.00%
ARNA $1.52 0.00%
ALKS $32.45 0.00%


Chart of I:DJI
DOW 15,973.84 +313.66 2.00%
S&P 500 1,864.78 +35.70 1.95%
NASDAQ 4,337.5120 +70.6750 1.66%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs