Biotech 101: Breakthrough Therapy

The breakthrough therapy designation is a relatively new term, but it's one biotech investors should make sure they're familiar with. The designation gives drugmakers more access to the Food and Drug Administration to speed approval of drugs that look promising.

In theory, at least.

We haven't seen enough drugs with the designation get approved to know if the breakthrough therapy designation is actually speeding approvals. There have been isolated incidences of early approvals like Novartis' (NYSE: NVS  ) Zykadia, which was approved to treat lung cancer four months before the FDA was scheduled to make a decision.

But we saw early approvals occasionally happening before the breakthrough designation was implemented. Medivation's (NASDAQ: MDVN  ) Xtandi, for instance, was approved just three months after submitting its application for the cancer drug.

And then we have companies such as Sarepta Therapeutics (NASDAQ: SRPT  ) , which has told investors that it doesn't think it needs to bother applying for breakthrough therapy designation for its muscular dystrophy drug because it's having plenty of interaction with the FDA.

Watch the following video for more thoughts on breakthrough therapy designation from the Fool's senior biotech specialist, Brian Orelli, and health-care analyst David Williamson.

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Brian Orelli

Dr. Orelli is a Senior Biotech Specialist. He has written about biotech, pharmaceutical, and medical device companies for The Motley Fool since 2007.

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