Stockwatch: Lifestyle cats and dogs
This article was originally published in Scrip
In a week when risk-aversion caused by events in China and the Ukraine caused the FTSE100 index to suffer its worst week in nine months, nothing appeared to affect the biotech industry. In the US, four of the most risky of all assets – new loss-making biotech companies - completed their IPOs on NASDAQ.
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Biogen’s poor third-quarter results cannot be blamed solely on the pandemic. Pipeline attrition and underperformance in most franchises pushes all the risk onto a dubious throw of the regulatory dice.
Early in 2020, company guidance was that pandemic-related effects would have dissipated in the third quarter. Issues specific to J&J and Roche leave this broad conclusion still up in the air.
Drugs that have failed in clinical studies often come back for another go, making the same mistakes for a new cohort of investors who missed the first failure. The global pandemic is also enabling this for once- or twice-failed drugs.