Biotech 101: Off-Label Prescriptions

Investors can learn something from Medivation, GlaxoSmithKline, Amarin and AstraZeneca.

Jun 23, 2014 at 7:25PM

When the Food and Drug Administration approves a drug, it's given a label, although there's no sticky stuff on the back and it's not attached to the bottle. Drug labels are multipage documents that list everything from the chemical description of the drug to side effects to the results from clinical trials.

The first section, called Indications and Usage, describes what the drug is approved to treat, but doctors are allowed to prescribe FDA-approved drugs for any indication they want. These so-called off-label prescriptions can be very important to companies.

Cancer drugs, for instance, are often initially approved for late-stage patients before going after a first-line indication. After the data for the first-line indication has been released but before the FDA approves the expanded indication, doctors often prescribe the drug for new patients. Medivation (NASDAQ:MDVN) and Astellas are currently in that situation with their prostate cancer drug Xtandi. The drug is approved only for patients who have failed chemotherapy, but they've shown that the drug also works well in patients who have yet to receive chemotherapy.

Other drugs get used, even though there's little evidence that they help patients. GlaxoSmithKline's (NYSE:GSK) fish oil Lovaza, for instance, is often used for patients with moderately high triglyceride levels even though it's approved only for patients with extremely high levels. There's no proof of a clinical benefit for drugs that lower patients' triglyceride levels if they're not extremely high, although Amarin (NASDAQ:AMRN) and AstraZeneca (NYSE:AZN) are testing their respective fish oils in patients with moderately high triglyceride levels. Interestingly, Amarin's Vascepa hasn't been able to pick up much of the off-label sales that GlaxoSmithKline has, perhaps suggesting that doctors are becoming more tentative about prescribing the drugs off-label. AstraZeneca's Epanova was approved only last month, so we'll have to wait and see if sales are also subdued until more clinical data is available.

Watch the following video for more info on off-label sales from senior biotech specialist Brian Orelli and health-care analyst David Williamson, including how off-label marketing can cost companies billions in fines.

Top dividend stocks for the next decade
The smartest investors know that dividend stocks simply crush their non-dividend-paying counterparts over the long term. That's beyond dispute. They also know that a well-constructed dividend portfolio creates wealth steadily, while still allowing you to sleep like a baby. Knowing how valuable such a portfolio might be, our top analysts put together a report on a group of high-yielding stocks that should be in any income investor's portfolio. To see our free report on these stocks, just click here now.

Brian Orelli and The Motley Fool have no position in any of the stocks mentioned.  David Williamson owns shares of Amarin. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Money to your ears - A great FREE investing resource for you

The best way to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as “binge-worthy finance.”

Feb 1, 2016 at 5:03PM

Whether we're in the midst of earnings season or riding out the market's lulls, you want to know the best strategies for your money.

And you'll want to go beyond the hype of screaming TV personalities, fear-mongering ads, and "analysis" from people who might have your email address ... but no track record of success.

In short, you want a voice of reason you can count on.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich," rated The Motley Fool as the #1 place online to get smarter about investing.

And one of the easiest, most enjoyable, most valuable ways to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as "binge-worthy finance."

Whether you make it part of your daily commute or you save up and listen to a handful of episodes for your 50-mile bike rides or long soaks in a bubble bath (or both!), the podcasts make sense of your money.

And unlike so many who want to make the subjects of personal finance and investing complicated and scary, our podcasts are clear, insightful, and (yes, it's true) fun.

Our free suite of podcasts

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. The show is also heard weekly on dozens of radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable. Rule Breaker Investing and Answers are timeless, so it's worth going back to and listening from the very start; the other three are focused more on today's events, so listen to the most recent first.

All are available for free at www.fool.com/podcasts.

If you're looking for a friendly voice ... with great advice on how to make the most of your money ... from a business with a lengthy track record of success ... in clear, compelling language ... I encourage you to give a listen to our free podcasts.

Head to www.fool.com/podcasts, give them a spin, and you can subscribe there (at iTunes, Stitcher, or our other partners) if you want to receive them regularly.

It's money to your ears.

 


Compare Brokers