Clinical Trials: The Stages and What to Look For

Understanding clinical trials is crucial if you are interested in investing in pharmaceutical or biotech stocks. These trials are the make or break for a company in this sector, so you need to get your head around them.

Even the most exciting treatments with massive Total Addressable Markets (TAM) are meaningless without successful trial data to back them up.

The Four Phases of Clinical Trials: Breaking it Down

Clinical trials are conducted in four distinct phases, each designed to answer specific questions about the treatment.

Multiple trials can be conducted within each phase. Each trial will have specific targets, which will inform future trials and, finally, regulatory approval.

Let’s break them down one by one.

Preclinical Testing: The First Hurdle

Before a drug even reaches the clinical phases, it undergoes preclinical testing. This can include studies on cells (in vitro) and animals (in vivo) such as mice or monkeys.

These early tests check for basic safety and biological activity. If the results look promising the drug moves on to human trials.

Phase 1: Is it Safe?

The first hurdle for any new treatment is safety.