Risk Factors in Clinical/Regulatory Outcomes
Not only is your observation regarding a partnership (or lack thereof) relevant vis-à-vis clinical trials, it is relevant for regulatory submissions too. However, the lack of a partnership is pretty far down on my list of risk elements. Before worrying about that, investors ought to mull some even greater risks.
For simplicity, I’m omitting such obvious risks as a clearly undersized trial or a regulatory submission based on pivotal trials that missed their goals. I.e., we are talking about the most important risks for a bona fide phase-3 trial or NDA/BLA.
The major risks in descending order of importance (IMO) are as follows:
1. Large insider selling around the time when data mature (e.g. PARS).
2. Poorly-understood disease, especially when there is no animal model. This includes such conditions as CFIDS, fibromyalgia, interstitial cystitis, irritable bowel syndrome, and the like.
3. Novel mechanism of action.
4. Non-disclosure of key details of the trial design and statistical-analysis plan. (This reared its head in NUVO’s recent failure in catheter occlusion.)
5. A high proportion of trial sites in third-world countries.
6. Failure to obtain a Special Protocol Assessment (FDA) or formal protocol guidance (EMEA).
7. Unduly complex trial design, which increases the likelihood of protocol violations.
8. Unusual primary endpoint (if there is no SPA).
9. Unusual scheduling of data reporting to investors (e.g. TELK).
10. Lack of a partner.
Feedback is welcome on any of the above!
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