SOURCE: The Bedford Report

The Bedford Report

July 14, 2011 08:16 ET

Biotech Sector Grapples With High Failure Rates

The Bedford Report Provides Equity Research on Somaxon and Avanir Pharmaceuticals

NEW YORK, NY--(Marketwire - Jul 14, 2011) - There is plenty of optimism surrounding the biotechnology industry as firmer pricing and new products have improved sales and earnings trends. Meanwhile, younger, more speculative firms continue to garner significant attention with potential blockbuster products working their way through the regulatory process. The Bedford Report examines the outlook for companies in the Biotechnology Industry and provides investment research on Somaxon Pharmaceuticals, Inc. (NASDAQ: SOMX) and Avanir Pharmaceuticals, Inc. (NASDAQ: AVNR). Access to the full company reports can be found at:

Citing agency officials, The Wall Street Journal reported this month that the Food and Drug Administration (FDA) has approved 20 new drugs so far this year -- just one short of the total for all of 2010. Some lawmakers in Washington have been arguing that the FDA's tougher safety stance has slowed down the pace of drug approvals and hurting the pharmaceutical and biotech industry.

Janet Woodcock, the head of the FDA's drug division, defended the FDA's role, saying challenges being faced by the biotech and pharmaceutical industry are related to high failure rates of drugs in the development process rather than FDA regulations.

A study released by BIO and BioMedTracker claims that the success rate in bringing new medicines to market in the past six years is only about half of what it had been previously. The study claims, however, that biotech drugs are twice as likely to gain approval, compared to more traditional chemical drugs.

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Somaxon Pharmaceuticals is a specialty pharmaceutical company, focused on the in-licensing, development, and commercialization of proprietary branded products and late-stage product candidates for the treatment medical conditions in the central nervous system therapeutic area. Last month Somaxon and Pro Com One Inc filed a lawsuit against India's Zydus Cadila challenging its application to make a copycat version of Somaxon's insomnia drug, Silenor.

Avanir Pharmaceuticals provides Nuedexta for the treatment of pseudobulbar affect and AVP-923, which has completed Phase III trial for the treatment of patients with diabetic peripheral neuropathic pain, as well as AVP-923, which is in phase I clinical trials for the treatment of MS-related pain.

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