Anavex Life Sciences Corp (AVXL)

[Steady_T]

Your assertions agree with the CBO on the costs of drug development. Although the part about cost to society seems suspect. The CBO estimate is just for drug companies.

So how does that apply to Anavex? Does the fact that Anavex has no failures so far count for or against Anavex in the drug development discussion? Does that mean it is lucky? Does that mean they are better candidate pickers? Or, more likely, Anavex is a small company and the law of averages has yet to catch up to it.

Developing new drugs is a costly and uncertain process, and many potential drugs never make it to market. Only about 12 percent of drugs entering clinical trials are ultimately approved for introduction by the FDA. In recent studies, estimates of the average R&D cost per new drug range from less than $1 billion to more than $2 billion per drug. Those estimates include the costs of both laboratory research and clinical trials of successful new drugs as well as expenditures on drugs that do not make it past the laboratory-development stage, that enter clinical trials but fail in those trials or are withdrawn by the drugmaker for business reasons, or that are not approved by the FDA. Those estimates also include the company’s capital costs—the value of other forgone investments—incurred during the R&D process. Such costs can make up a substantial share of the average total cost of developing a new drug. The development process often takes a decade or more, and during that time the company does not receive a financial return on its investment in developing that drug.

https://www.cbo.gov/publication/57126#:~:text=The%20expected%20cost%20to%20develop,to%20more%20than%20%242%20billion.