Posted tagged ‘Biotech’

Recent Quarters Produce Large Number of Biotech IPOs

July 8, 2014

After a major boom in initial public offerings (IPOs) in the biotech sector during 2013 and the first quarter of 2014, the trend seems to be slowing. Last year, more than 45 biotechnology firms entered the public market, generating over $3 billion. Although some feared that the biotech bubble would soon burst, 29 life sciences start-ups went public in 2014’s first quarter. Together, the companies collected just over $2 billion, which will fund continued research and development efforts by firms like Ultragenyx and Dipexium Pharmaceuticals. However, few industry experts expect the number of biotech IPOs to hold steady at such a high rate. In fact, some even argue that these high-performing stocks could ultimately de-incentivize the buyout activity of large pharmaceutical companies upon which small biotech firms rely.

Moving into the second quarter, biotech companies may want to carefully weigh the pros and cons of pursuing IPOs versus merger and acquisition opportunities. Boards must examine shareholders’ risk and return profiles, the deal’s time to liquidity, and rates of dilution. Biotech investment is often both risky and long-term, so it is ideal to ensure that shareholders are able to reap the benefits of their early risks.


Changing Attitudes toward Fibromyalgia

June 18, 2014

Fibromyalgia, which produces symptoms of chronic fatigue and aches and pains throughout the body, is an often-misdiagnosed condition. Yet, when identified and properly treated, it can be manageable and need not overly impact a person’s quality of life. One estimate by the American College of Rheumatology put the number of Americans with fibromyalgia at about one in 50.

In the 1800s, physicians first described fibromyalgia, which they called “muscular rheumatism,” listing it as a “mental” problem. At that time, the collection of symptoms indicative of the condition—aches, exhaustion, difficulty sleeping—had already been identified among its characteristics.

By the early 20th century, Ralph Stockman had conducted pathology studies that showed evidence of inflammation in the fibrous septa membranes dividing muscle tissue. At about the same time, Sir William Gowers coined the term “fibrositis” to describe the inflamed fibrous tissue that resulted in lower back pain for his patients. It was not until the mid-1970s that Gowers’ word was superseded by today’s “fibromyalgia.”

As contemporary medicine progressed and research better defined the parameters of the condition, fibromyalgia began to lose some of its unjustified reputation as a “mental” or “imaginary” disorder. In 1981, the reality of the tender points and other symptoms associated with fibromyalgia were validated through a controlled clinical research project. In addition, in 1990, the American College of Rheumatology published a set of diagnostic criteria intended to guide researchers. Physicians shortly adopted these standards in diagnosing and treating patients. In 2007, the Food and Drug Administration approved one of the several fibromyalgia-targeted drugs currently on the market

Venture Capitalists See Massive Opportunity in Biotech Sector

October 8, 2013

Lindsay Rosenwald co-manages an investpment partnership that specializes in biotechnology investment. In addition to his professional obligations, Lindsay Rosenwald contributes to a variety of philanthropic organizations through the Rosenwald Foundation.

BiotechInvestment in the biotechnology sector has surged in 2013, following more than a dozen initial public offerings. In addition to the funds raised through these IPOs, experts report that venture capitalists poured $1.3 billion into the industry in the second quarter. A 41 percent increase over the first quarter, the sum encompasses more than 100 deals. Furthermore, funding for early-stage start-ups doubled to $328 million in the second quarter, demonstrating an enthusiasm for the industry that has not existed since before the financial crisis.

Unlike pharmaceutical companies, which typically allocate sales profits from drugs on the market to fund new drug development, biotechnology firms generally operate at a loss during their extensive research and development phases. Biotech firms have produced some of the most innovative therapies on the market; however, as a result of their business model, they require increased investor funds.