Date of Award

2013

Document Type

Honors Thesis (Colby Access Only)

Department

Colby College. Economics Dept.

Advisor(s)

Randy A. Nelson

Second Advisor

David W. Findlay

Abstract

The scope of investment managers has increased to include many niche strategies such as predicting drug development outcomes. Pharmaceutical firms must submit a New Drug Application to the U.S. Food and Drug Administration after the completion of their clinical trials in order to get the final regulatory approval before they can market the drug. In this paper, I search for the stock market’s ability to accurately predict designations before the actual announcement for 116 PDUFA dates. I find that the market is able to predict approval designations by the FDA and that this predictive power is stronger for smaller capitalization firms.

Comments

Full-text download restricted to Colby College campus only.

Keywords

medicine, food and drug administration, markets

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