Picking biotech stocks for short-term and long-term investment could be a good practice if investors know what to pick. In most cases, picking biotech stocks that have no near-term catalysts could be disappointing, leading investors to wait and wait, then get bored, and sell their shares at a great loss. To pick firms in early- or mid-phase development the firms should have very advanced technologies and product pipelines with strong evidence of promise that they are the envy of rich pharmaceutical firms. The large-pocketed drug developers usually desire what they need and buy what they desire. Most are currently in dire need of breakthrough products, as the patent lives of many of their bestsellers are expiring. Investors must be aware of the fact that stocks of development-stage firms’ are destined to fall after each and every quarterly financial results announcement, as they have no revenues or incomes. They also fall after shareholders get disappointed in the negative performances of their stocks, hence, trash them. Compensation can come early, however, in the event of takeovers, alliances that pay huge upfront payments, or the announcement of stunningly positive clinical trial results of products that deal with life-threatening diseases with large markets. Focused investors may be able to catch big fish in situations exemplified by the following three circumstances: More...

A few days before the independent FDA committee review of Human Genome Sciences’ (HGSI) systemic lupus erythematosus (SLE) drug Benlysta (belimumab), the FDA suggested that the drug has marginal efficacy and scary adverse effects. The agency expressed concerns about infection, neuropsychiatric complications, including the risk of suicide, and increased risk of death as a result of the use of the drug. The FDA message to the independent committee, which will convene on Tuesday, is to decide whether the reward is worth the high risk. The FDA has also observed that studies conducted outside the U.S. produced stronger data than the U.S.; these studies were not consistent with the U.S. results. The agency has also observed that the African-American lupus patients had benefited less from Benlysta than did non-African American patients.  More...