文章基本信息

标题：Market Responses Around FDA Announcements
本地全文：下载
作者：Nelson Lacey ; Anurag Sharma
期刊名称：B Quest
电子版ISSN：1084-3981
出版年度：2008
出版社：Richards College of Business, University of West Georgia
摘要：This paper tracks the returns of pharmaceutical stocks at the time of drug approvals and rejections by the Food and Drug Administration (FDA). It follows a previous study by Sharma and Lacey (2004) that demonstrated a link between market valuation and new product development which found that development successes have a different impact than do development failures. In this study these authors place pharmaceutical firms in two samples; good news for positive FDA announcements and bad news for negative FDA announcements. The authors show that the announcement effects are as expected (positive and significant risk-adjusted abnormal returns for the good news sample and negative and significant risk- adjusted abnormal returns for the bad news sample). They find that the fall in value from bad news is orders of magnitude larger than the rise in value from good news. They also find evidence of a market able to discern differences in the treatment potential of approved drugs such that announcements related to new molecular entities are more important than thosethat relate to new formulations or applications. Finally, while their results are consistent with an FDA that does a good job of keeping these announcements out of the public arena prior to disclosure, they are able to document evidence of leakages prior to the announcement of bad news.