ArticleTherapeutic innovation & regulatory science2022
Valuation and Returns of Drug Development Companies: Lessons for Bioentrepreneurs and Investors.
Article in Therapeutic innovation & regulatory science, 2022. The graph could read no effect estimate from its abstract, so it casts no vote on the map. Cited by 16 papers, 1 of them a synthesis that pooled it.
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Who cites it
16 citing papers in PubMed, 1 synthesis or guideline pooled it.
- Framework to identify innovative sources of value creation from platform technologies.Proceedings of the National Academy of Sciences of the United States of America · 2025Pooled it
- Identifying Factors Associated with the Acquisition of Multiple Indications for Anticancer Drugs.Current oncology (Toronto, Ont.) · 2026Observational
- Systematic review protocol on evidence synthesis for health technology decisions in ultra-rare diseases.Systematic reviews · 2026Article
- Two Worlds, One Battle: How Bacteria and Malignancies Converge on Drug Resistance.International journal of molecular sciences · 2026Review
- On the potential value of eHTA: a commentary on "Defining Early Health Technology Assessment: Building Consensus Using Delphi Technique".International journal of technology assessment in health care · 2025Article
- Pharmaceutical Company's Choices of Indication for the First Clinical Projects in Oncological Drug Development in the United States.Therapeutic innovation & regulatory science · 2025Article
- An 'Adaptive Treatment Strategy' for Oral Vancomycin in Patients with the Orphan Disease Primary Sclerosing Cholangitis.Digestive diseases and sciences · 2024Review
- Special FDA designations for drug development: orphan, fast track, accelerated approval, priority review, and breakthrough therapy.The European journal of health economics : HEPAC : health economics in prevention and care · 2024Review
- Launch and Post-Launch Prices of Injectable Cancer Drugs in the US: Clinical Benefit, Innovation, Epidemiology, and Competition.PharmacoEconomics · 2024Article
- Venture capital funding of dermatology companies founded by women: a unique set of challenges.International journal of women's dermatology · 2023Article
- FDA approval, clinical trial evidence, efficacy, epidemiology, and price for non-orphan and ultra-rare, rare, and common orphan cancer drug indications: cross sectional analysis.BMJ (Clinical research ed.) · 2023Article
- Article
- Pharmaceutical policy and innovation for rare diseases: A narrative review.F1000Research · 2023Review
- Value drivers of development stage biopharma companies.The European journal of health economics : HEPAC : health economics in prevention and care · 2022Article
- Value and Price of Multi-indication Cancer Drugs in the USA, Germany, France, England, Canada, Australia, and Scotland.Applied health economics and health policy · 2022Article
- Initial and supplementary indication approval of new targeted cancer drugs by the FDA, EMA, Health Canada, and TGA.Investigational new drugs · 2022Article
Corrections and comments
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Authors and funding
4 authors.
Funding
No grant is acknowledged in the PubMed record.
Abstract
objectivesThis study evaluates the association of Biopharma company valuation with the lead drug's development stage, orphan status, number of indications, and disease area. We also estimated annual returns Bioentrepreneurs and investors can expect from founding and investing in drug development ventures.
methodsSDC Thomson Reuter and S&P Capital IQ were screened for majority acquisitions of US and EU Biopharma companies developing new molecular entities for prescription use (SIC code: 2834). Acquisition data were complemented with drug characteristics extracted from clinicaltrials.gov, the US Food and Drug Administration (FDA), and deal announcements. Thereafter, company valuations were combined with previously published clinical development periods alongside orphan-, indication-, and disease-specific success rates to estimate annual returns for investments in drug developing companies.
resultsBased on a sample of 311 Biopharma acquisitions from 2005 to 2020, companies developing orphan, multi-indication, and oncology drugs were valued significantly higher than their peers during later development stages (p < 0.05). We also estimated significantly higher returns for shareholders of companies with orphan relative to non-orphan-designated lead drugs from Phase 1 to FDA approval (46% vs. 12%, p < 0.001). Drugs developed across multiple indications also provided higher returns than single-indication agents from Pre-Clinic to FDA approval (21% vs. 11%, p < 0.001). Returns for oncology drugs exceeded other disease areas (26% vs. 8%, p < 0.001).
conclusionsClinical and economic conditions surrounding orphan-designated drugs translate to a favorable financial risk-return profile for Bioentrepreneurs and investors. Bioentrepreneurs must be aware of the upside real option value their multi-indication drug could offer when negotiating acquisition or licensing agreements.
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Registered trials
Read under generation 80e0d062 · epoch 390. Bibliography from PubMed, PubMed Central and OpenAlex; grants from NIH RePORTER; trial links from ClinicalTrials.gov; estimates, votes and beliefs from the OpenQuestion graph.