Merck & Co., Inc. (MRK), Pfizer Inc. (PFE): These 2 Healthcare Stocks Could Win Big With FDA’s New ‘Breakthrough’ Status

Page 1 of 2

The Food and Drug Administration (FDA) made a groundbreaking policy change last year that is having a large impact on the biotech industry and creating a big opportunity for investors.

To create a faster path to commercialization for potentially life-saving drugs and medicine, the FDA in July introduced a new “breakthrough” status for drugs that show “substantial improvement on existing therapies for clinically significant endpoints.”

Pfizer Inc. (NYSE:PFE)

For an industry that is accustomed to a costly 10-year commercialization process, the breakthrough status is a welcome shift. An accelerated channel to commercialization could enable drug companies to shave years and billions of dollars from the cumbersome process.

But the FDA’s new breakthrough status isn’t just a win for drug companies and the health care industry — it’s also creating an opportunity to invest in the most innovative companies in the world. The companies winning breakthrough status for their drugs are in the hunt for the next billion-dollar blockbuster, something that can send both earnings and shares soaring.

And now, just six months after kicking off, the program is accelerating, with the FDA unleashing a wave of breakthrough designations in the past few months that has the industry buzzing.

That includes Novartis AG (ADR) (NYSE:NVS) LDK378, a next-generation ALK inhibitor that was awarded breakthrough status in March amid Phase II trials. The company said it plans to seek FDA approval next year after only three years of development. That could mean huge savings in time and capital for Novartis AG (ADR) (NYSE:NVS).

The FDA’s oncology chief, Richard Pazdur, recently emphasized the agency’s commitment to the program, stressing that any drug development team working on a breakthrough drug won’t have any problem getting steady feedback from the agency and his oncology division.

Looking forward, the FDA’s breakthrough program is a great place to find the best companies in health care that are developing the most innovative and commercially viable drugs.

Here are two leading health care companies that are gaining on recent breakthrough designations.

Pfizer Inc. (NYSE:PFE)
Pfizer Inc. (NYSE:PFE) is one of the largest health care companies in the world, with a market cap of $201 billion.

The company is using its massive scale to produce some of the most innovative medical technology in the world, recently earning breakthrough status for a breast-cancer drug called palbociclib. Analysts from JPMorgan Chase & Co. (NYSE:JPM) and Leerink Swann speculate the drug could generate annual sales of more than $5 billion if approved for use against breast cancer. Pfizer Inc. (NYSE:PFE) said the special status was awarded based on impressive results in midstage trials. Looking forward, palbociclib will still be subjected to rigorous testing, but its breakthrough status makes the path to commercialization much quicker and less expensive.

These 2 Health Care Stocks Could Win Big With FDA's New 'Breakthrough' Status

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

The 10 Countries with the Highest Suicide Rates

The 10 Most Technologically Advanced Countries in the World

The 10 Safest Countries in the World to Live in Peace

The 10 Top Selling Smartphones in the World 2014

The 12 Biggest Shopping Centers in the World

The 10 Friendliest Countries in the World

Qihoo 360 Technology Co Ltd (QIHU), Actavis plc (ACT), Yahoo! Inc. (YHOO) Among 20 Long Ideas from Sohn Canada

The 10 Laziest Countries in the World

The 10 Most Polluted Countries in the World

The 10 Most Dangerous Cities in America 2014

The Top 10 Gold Producing Countries in the World

The 10 Tallest Buildings in the World

The 10 Richest Stand Up Comedians in the World

The 10 Fattest Countries in the World

The 5 Best Summer Jobs for Teens

The 10 Most Religious Countries in the World Keeping the Faith

The 10 Most Educated Countries in the World

The 10 Most Popular Cell Phones in the World

The 10 Drunkest Countries in the World

The 10 Most Expensive Private Schools in the World

The 10 Smallest Countries in the World

Walking Dead Season 5 Spoilers You’ll Wish You Didn’t Know

The 10 Poorest Countries in the World

The 10 Greenest Countries in the World

The Top 10 Countries with the Highest Population in the World

The 10 Most Visited Countries in the World

The Top 10 Star Wars Characters in the Iconic Series

The 10 Most Expensive Android Phones in the World

5 Reasons Why The Illuminati Is Real and a Threat to Society

The 6 Scariest Halloween Costumes Ever Screamed At

The 4 Biggest Hedge Fund Managers in the World Today

The 15 Most Densely Populated Countries in the World

The 10 Biggest Tea Drinking Countries in the World

Top 6 Ways to Improve Your Checkout Process and Close Sales

The 5 Most Profitable Online Businesses You Can Start Today

The 20 Most Profitable Hospitals in the US

The 5 Most Profitable Home Businesses to Start

The 7 Teams that Will Win the Stanley Cup in 2015

The Top 10 Most Expensive Digital Cameras to Snap Stunning Shots With

The 10 Highest Quality Fast Food Restaurants In America Today

The 8 Best Halloween Decorating Ideas to Spook Up Your House

10 Marvel Women that Should Get a Movie Right Now

The 20 Best Remixes of Popular Songs that Will Make You Forget the Originals

7 Most Expensive Cities in the World

5 Least Expensive Cities in the World

10 Celebrities Who Believe In Scientology

10 High Margin Food Products to Build a Business Around

The 10 Most Expensive Clothing Stores in the United States to Get Decked Out At

The 5 Biggest Kickstarter Scams That Swindled Backers’ Donations

The 10 Most Expensive Boarding Schools In the World

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!