ATPblog

Going against the Grain: Is it time to take a stand against “Asset Favoritism”?

In his 2004 Chairman’s Letter at Berkshire Hathaway, Warren Buffet offered sound advice to those trying to find the best time to invest in equities: “be fearful when others are greedy and greedy when others are fearful”.   For equity investing, this strategy seems to work very well.  Selling at the end of a long bull run, just as others are piling in on the back of historical gains was the right strategy in 2008.  Buying up distressed assets at a time when most potential purchasers are too fearful to move, keeping prices depressed, was surely the right strategy in the years that followed the crash.  But is going against the grain also a winning strategy for private equity investors in high-risk biotech ventures?

Is Pharma's Perfect Storm Biotech's Greatest Opportunity?

Many folks within pharma lament the current challenges and look back to a gilded era when blockbusters provided rivers of cash flow and supported growth based activities - both R&D and marketing. And yet, could this present biotech's greatest opportunity as an industry?

SuperGen Acquires Astex: The Biotech Funding Relay Race

Last week witnessed an interesting M&A deal between SuperGen and Astex. Here, we look at investor returns and wonder what could be in store for the enlarged company?

Finding Safer Medicines

Medicines need to be safe and effective.   Once upon a time there was a trade-off between the two that was assessed at the population level – over the entire group of people receiving the medicine was there more benefit than harm.  Across a broad swathe of an indication, a positive answer to this risk:benefit equation was usually sufficient to support approval and widespread clinical adoption.

Too Much Safety?

Making drugs safer might cost you your job – or even your life! The ethical paradox at the heart of declining pharmaceutical R&D investment

On the 1^st February 2011, one of the largest and most successful global pharmaceutical companies, Pfizer, announced the closure of its Sandwich (Kent, UK) site, with the loss of the 2,400 jobs. 

Know Yourself (Free Personality Test)

I recently came across a website that allows you to do a free personality profile online. It takes about 10 minutes and the results can be really interesting - I mentioned it to a few close friends and all of us found ourselves nodding (mostly) in agreement.

Biotech Survival Lessons from the Inuit

I've recently been following the BBC's excellent "Human Planet" series. Last week's program was a fascinating insight into how the Inuit of the Arctic have adapted human existence, over centuries, to live in one of the harshest environments known to man. Why mention this on a blog about biotech funding?

Does R&D Pay? (journal article)

This month we highlight a paper published earlier this year in Drug Discovery Today. The article, "Does R&D Pay?" looks at the effectiveness of different R&D strategies. This is achieved by looking at 10 year historical financial performance of different types of drug firms (big pharma, specialty/ generic, and biotech).

And it leads to some interesting conclusions about where investors might get the best return...

The Biotech Life Cycle - Seattle Revisited

BMS is currently in discussions to buy Zymogenetics, from Seattle. While some will mourn at the loss of another regional leader, we see things a different way.

A recent article from the Seattle Times highlights why recycling is so important to building biotech into a

Market Access: How Does it Affect Biotech Funding Prospects?

Does it work?  Once upon a time it was sufficient to determine if a drug, diagnostic or device delivered some benefit.  A significant effect in a randomized, placebo-controlled trial was necessary and sufficient to identify efficacy.  Combined with demonstration of safety, this was enough to garner regulatory approval and with it a sizeable profit. But not any more.

Biotech Funding: Feel a Breeze From the IPO Window?

What do the following biotech stocks have in common - Anthera (NASDAQ:ANTH), Ironwood (NASDAQ: IRWD), Aveo (NASDAQ:AVEO), NeoVacs (EPA:ALNEV) and Nupathe (NASDAQ:PATH)? They are all biotech companies that achieved fundings through IPOs in 2010. And ALL are underwater compared to

The New Reality Starts to Hit Home

We all know the mantra of the post-credit crunch pharma and biotech world – lean, mean and focused in the era where cost-effectiveness is king. The message is that we have learnt from our mistakes of the past, embracing now instead strategic flexibility and a global focus on delivery of healthcare to the individual. The industry has made lots of resolutions – but is it walking the walk as well as talking the talk?

Value creation: Are pure-plays better than hybrids?

In this research note, we consider the value and merits of using a pure-play business model (i.e. biotech R&D pipeline, or cash generating services business) against the hybrid approach. Several case studies from the market suggest there may be greater value in focus.

Is MYRX a biotech value play?

Myriad Pharmaceuticals (NASDAQ: MYRX), is a spin-off from Myriad Genetics (NASDAQ: MYGN) which was effected in June 2009. MYRX is focused on developing an R&D stage pipeline (with cash burn). MYGN is focused on a service business providing genetic testing (profitable). MYRX is valued at less than cash,

Look Behind the Numbers...

A recent article from FierceBiotech discusses the last year’s share price recovery of CRO stocks in the US. It refers to a panel at the recent Partnerships in Clinical Trials conference in Orlando:

Another grim day for big science…

Technology investing is, at some level, built on a foundation of science.   Converting knowledge into commercially successful products requires a mix of skills, of which scientific excellence is only one (spotting a ripe product opportunity is at least as difficult as finding the technological solutions

Biomarkers: A Band-Aid for Bioscience?

 

INTRODUCTION

There is no disputing that the pharmaceutical industry has a problem.  It is widely acknowledged that R&D productivity is declining, with new drug registrations falling to their lowest levels for almost half a century.  Genuine medical advances are rare – those products that are registered increasingly offer only a small

Declining Exclusivity: are Patents now Redundant?

Because new medicines have such a high burden of R&D costs to recuperate, their commercialisation in a protected environment is essential to the innovator business model. That protection has historically been offered through the patent system, but for how much longer, given the increasing time taken to innovate?

And an IPO window is an even more distant panacea...

...as evidenced by two IPOs that went out in 2010, with substantial haircuts:

Anthera Pharmaceuticals, reported in WSJ:

Acquisitions & Licensing: No Panacea

A recent Lex article from the FT highlights some of the recent deals done, both acquisitions and licensing, between big pharma and biotechs. Usefully, it serves to remind us, that while the popular headlines capture pharma's and bigger biotech's need to buy-in research programs from R&D stage companies, this is no sure thing for earlier stage companies.