Replies to post #205989 on Biotech Values

[mcbio]

Suggest you aren't understanding. Without rigorous data it is, literally, impossible to sort it out. As a way to think about this, you yourself do not want to hold companies through their phase 3 binaries because 90% of phase 2s are completely inadequate to determine whether the drug is clinically useful. And the 'reformers' essentially want to move to something much much closer to phase 2 'proof' as adequate for approval.

(Examples of such proof are: single arm comparison to historicals (do you consider such phase 2s adequately dispositive to hold through a phase 3?), biomarkers (do you consider such ph 2s adequate to hold through a clinical endpoint ph3?)). And you undoubtedly are better at sussing out real phase 2 efficacy than 90% of MDs.

PS Sorry for being a little pointed, but really don't think people are thinking this through. Over the Xmas break I'll screed on some related topics because there are some things we could probably do to improve the process. But only around the edges. Essentially we are already fairly close to the Shannon's Limit of biomedical research (Shannon's Limit is a about how much information you can get through a system).

I believe I follow but just still continue to respectfully disagree. You would still likely have more robust Phase 2 data from the more legit companies than from the wannabes. And, in any event, again, I would think that over time the marketplace would sort out those drugs that ultimately have the more meaningful impact and reward accordingly (i.e., the rigorous data that may not be fully present in Phase 2 would ultimately get borne out once drugs on the market; robust cancer drugs would show divergence in time of OS benefit once on market than those from the shoddy companies, etc.).

In any event, even if you and Dew are correct, would suggest that what you are positing is more a theoretical LT concern for the industry. In the ST, my gut is the market would likely reward the industry with higher valuations if approvals prove to be easier going forward, particularly small-cap biotech. Sure, in the LT, perhaps it's possible that the lower bar for approval might end up hurting the more legit companies but I'd rather first gamble on the ST and see where that takes us. All just IMHO.