What’s the Difference Between Fast Track & Breakthrough Therapy Designations?


Ryan Allway

April 20th, 2020

Policy


The Food and Drug Administration (FDA) granted Breakthrough Therapy status to COMPASS Pathway’s clinical trials evaluating psilocybin for the treatment of severe treatment-resistant depression. Shortly after, the regulatory agency granted the same designation for the Usona Institute’s psychedelic therapy targeting major depressive disorder.

Let’s take a look at what the Breakthrough Therapy status means and how it compares to the FDA’s other expedited review programs that accelerate drug approvals.

Expedited Review Programs

The Food and Drug Administration (FDA) attempts to review all drugs in a timely manner, but they prioritize therapies that treat serious of life-threatening diseases or have the potential to provide unusually large benefits to patients. The goal is to maximize the use of its resources in a way that promotes health and safety among patients.

There are four different expedited review programs available to companies that meet these criteria:

  • Priority Review – Requested alongside a new drug application (NDA) or biologics license application (BLA) to cut a drug’s FDA review period from ten months to six months.
  • Fast Track – Requested as early as the investigational new drug (IND) application to provide extra opportunities to meet with the FDA, discuss study design, and identify the most efficient pathways to approval.
  • Breakthrough Therapy – Requested as early as the investigational new drug (IND) application to provide enhanced Fast Track benefits, as well as potentially skip portions of the standard FDA review process.
  • Accelerated Approval – Requested at any stage for drugs with long-term endpoints (e.g. increased survival) to permit approvals based on surrogate endpoints that are more easily measured and reasonably likely to improve outcomes.

In addition, the FDA may provide a priority review voucher to companies that are developing drugs that are not profitable but have a significant impact on patients’ quality of life. These vouchers can be used on future drugs that have wider indicators, although companies must pay a nominal ~$3 million fee in order to use the voucher.

Implications for Investors

The FDA’s expedited review process shortens the development timeline for clinical trials and could eliminate some of the more costly requirements and risks. However, the designation doesn’t guarantee a successful clinical trial or that a drug will be brought to market in a timely fashion — that still depends on the company and drug’s efficacy.

According to at least one study, the FDA’s decision to Fast Track drug candidates leads to an increase in a public company’s value. The study found abnormal trading volume and excess daily stock returns, along with greater institutional ownership and analyst attention among companies that were granted the Fast Track status.

Looking Ahead

Investors should understand the differences between different FDA expedited review processes before investing in psychedelic stocks or other areas of the market. By understanding these differences, they can improve the risk/reward profile of their investment holdings.

This article was published by CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the industry’s leading agency and digital financial media network dedicated to the burgeoning CBD and legal cannabis industries. Call +1 (833) 420-CNFN for more information.

Ryan Allway

About Ryan Allway

Mr. Allway has over a decade of experience in the financial markets as both a private investor and financial journalist. He has been actively involved in the cannabis industry since its inception, covering public and private companies.


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