Biotech Investing Glossary

An FDA pathway that allows drugs targeting serious conditions to be approved based on a surrogate endpoint reasonably likely to predict clinical benefit, rather than waiting for final clinical outcomes data. Post-market confirmatory trials are required.

A panel of outside scientific and medical experts convened by the FDA to evaluate a drug application and vote on whether the risk-benefit profile supports approval. AdCom votes are non-binding but heavily influence FDA decisions.

The formal application submitted to the FDA seeking permission to introduce a biologic product (such as a vaccine, blood product, or therapeutic protein) into the market. The FDA has a 12-month standard review and 6-month priority review target.

An FDA designation for drugs showing preliminary clinical evidence of substantial improvement over available therapy for serious conditions. Provides intensive FDA guidance and rolling review. Accelerates development timelines significantly.

BiotechSign's proprietary composite catalyst score (0–100) measuring the strength and density of active biotech signals for a company. Combines PDUFA timing, clinical trial data, insider buying, dilution risk, sentiment, and congressional trading into a single actionable number.

The number of months a company can sustain current operations before requiring additional financing, based on current cash reserves divided by monthly cash burn rate. Companies with less than 6 months of runway face elevated dilution risk.

An FDA order to pause or terminate a clinical trial due to safety concerns, inadequate data, or regulatory non-compliance. A full clinical hold stops enrollment and dosing; a partial hold restricts enrollment or dosing for specific patient populations.

A formal FDA communication indicating that a drug application cannot be approved in its current form, listing deficiencies that must be addressed before resubmission. Receiving a CRL is a significant negative catalyst for a stock.

A stock transaction made by a sitting member of Congress or their immediate family, required to be disclosed within 45 days under the STOCK Act. Research shows congressional traders often outperform market benchmarks, making these trades a signal of interest.

BiotechSign's letter grade summarizing the quality and timing of a company's upcoming catalysts. Grade A indicates multiple near-term, high-impact catalysts (PDUFA, AdCom, Phase 3 data). Grade F indicates no significant near-term catalysts.

The risk that a biotech company will issue new shares (via equity offering, PIPE, ATM program, or warrant exercise), reducing existing shareholders' percentage ownership. High dilution risk is particularly common in cash-constrained microcap biotechs.

An FDA designation for drugs targeting serious conditions and demonstrating the potential to address an unmet medical need. Enables rolling review of the NDA/BLA as data sections are completed, reducing time to potential approval.

The formal authorization from the U.S. Food and Drug Administration for a drug to be marketed for one or more indications. Standard review takes ~12 months from NDA/BLA submission; Priority Review takes ~6 months. The binary outcome (approval vs. rejection) is the single largest catalyst in biotech.

A mandatory disclosure form filed with the SEC within 2 business days whenever a company insider (officer, director, or 10%+ shareholder) buys or sells company stock. Cluster buying by multiple insiders is a historically bullish signal.

The formal application submitted to the FDA requesting permission to market a new pharmaceutical compound. Contains all clinical, preclinical, safety, and manufacturing data. Acceptance triggers a PDUFA date for the FDA's decision deadline.

FDA designation for drugs treating rare diseases affecting fewer than 200,000 U.S. patients. Provides 7 years of market exclusivity upon approval, tax credits for clinical testing costs, and waived NDA/BLA user fees. Significant economic incentive for rare disease development.

The Prescription Drug User Fee Act date—the FDA's self-imposed deadline for completing the review of a new drug application. The FDA aims to act (approve, issue a CRL, or request more data) by this date. PDUFA dates are the single most watched binary catalyst in biotech investing.

The first-in-human stage of clinical testing, typically enrolling 20–100 healthy volunteers or patients to evaluate safety, tolerability, pharmacokinetics, and maximum tolerated dose. Phase 1 failure rates are ~30%. Success here advances to Phase 2.

The second stage of clinical testing enrolling 100–300 patients to evaluate drug efficacy, determine optimal dosing, and continue safety monitoring. Phase 2 has the highest attrition rate (~65% of trials fail). Positive Phase 2 results often trigger significant stock appreciation.

The pivotal, large-scale clinical trial (300–3,000+ patients) that must demonstrate statistical superiority over placebo or standard of care to support an NDA/BLA submission. Phase 3 data readouts are major binary catalysts. Positive results typically precede FDA submission.

A financing transaction where a company sells shares or convertible securities directly to institutional investors at a discount to market price. PIPE deals are a common dilution mechanism for cash-strapped biotechs and are often viewed negatively by retail investors.

An FDA designation for drugs that offer major advances in treatment or provide treatment where no adequate therapy exists. Reduces FDA review time from 12 months to 6 months from NDA/BLA submission. Priority Review is granted at the FDA's discretion upon application filing.

The percentage of a company's float currently sold short (borrowed and sold, awaiting repurchase). High short interest (>15%) combined with positive catalysts can trigger a short squeeze, forcing bears to cover and amplifying stock gains.

A StonkWhisper proprietary signal measuring multi-dimensional sentiment alignment across institutional, retail, and options market participants. High convergence scores (≥0.75) indicate unusual market alignment often preceding significant price movement.

A security giving the holder the right to purchase company stock at a set price (exercise price) before expiration. Warrants are commonly issued with PIPE deals and public offerings. When stock prices rise above the exercise price, mass warrant exercises create dilution pressure.