Cytodyn Inc (CYDY)

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Securing Orphan Designation May Create Bidding War

The cost of developing a new drug has skyrocketed over the last three decades (almost $2 billion). As a result, Big Pharma is looking at orphan drugs ... here's why.

last month's NY Times:

Developing orphan drugs is cheaper. They receive expedited approval from the F.D.A. Clinical trials are inherently less expensive because the drugs are aimed at a small population. And insurance companies are willing to pay $100,000 a year for a drug that few patients will use.

“Companies are flocking to rare diseases,” said John LaMattina, a former head of research at Pfizer who now writes a blog about pharmaceutical research. “They might only make $500 million in sales a year, but their costs are much lower.”

Patricia Danzon of the Wharton School of the University of Pennsylvania suggests recalibrating the regulatory burden to favor research in drugs with a broader potential footprint. “The decks have been stacked in favor of orphan drugs,” she said

http://www.nytimes.com/2014/07/23/business/a-dearth-of-investment-in-much-needed-drugs.html?smid=tw-share