Comparing long-term value creation after biotech and non-biotech IPOs, 1997-2016.

ABSTRACT: We compared the financial performance of 319 BIOTECH companies focused on developing therapeutics with IPOs from 1997-2016, to that of paired, non-biotech CONTROL companies with concurrent IPO dates. BIOTECH companies had a distinctly different financial structure with high R&D expense, little revenue, and negative profits (losses), but a similar duration of listing on public markets and frequency of acquisitions. Through 2016, BIOTECH and CONTROL companies had equivalent growth in market cap and shareholder value (>$100 billion), but BIOTECH companies had lower net value creation ($93 billion vs $411 billion). Both cohorts exhibited a high-risk/high reward pattern of return, with the majority losing value, but many achieving growth multiples. While investments in biotechnology are often c

SUBMITTER: Cleary EG 

PROVIDER: S-EPMC7787373 | biostudies-literature | 2021

REPOSITORIES: biostudies-literature