To succeed over the long haul, biotech investors need to be savvy in the ways of the market like everyone else, but they also require fairly specialized medical and scientific knowledge. Drug development can be amazingly complex, and if most investors are like me, their science education ended in college, if not high school. Some readers have asked for "Biotech 101" columns to help them make better investing decisions. This column is for those people who don't know the difference between an IND (which is an investigational new drug) and a phase II study, but really want to know.
Drug DiscoveryDrug development starts small. In the research lab, scientists test thousands of chemical compounds and molecules against disease targets to find just a few promising drug candidates. This is the image that most people have when they think of drug research -- a bunch of scientists in white lab coats playing around with cells that are isolated in petri dishes and test tubes. More recently, the unraveling of the human genome and the accompanying technology championed by companies such as Human Genome Sciences ( HGSI) and Millennium Pharmaceuticals ( MLNM) have promised to speed up this time-consuming and tedious process, but will never eliminate it entirely.
Preclinical TestingCompounds that graduate from drug discovery move into preclinical, or animal, testing. In a lengthy series of tests, researchers need to learn how the drug candidate behaves when it enters the animal. Does the drug have the desired effect on the disease target? What are the toxicities? What doses can be safely used? How is the drug metabolized, or broken down, by the animal? What formulation (pill or injection) can be used? Are there any side-effects from long-term exposure, such as cancer or birth defects? Once this small mountain of animal data is collected, and assuming it's positive enough to move on, researchers file an IND application with the Food and Drug Administration. Regulators then decide if the experimental drug is safe enough to move into human testing.