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Biotech / Medical : Biotech Valuation

CRSP 56.68

-2.4%

Dec 12 9:30 AM EST

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To: Spekulatius who wrote (5240)	12/26/2001 1:04:18 PM
From: jayhawk969	of 52153

Good article: I noted: I predicted bad things for Hewlett-Packard's (HWP) Compaq (CPQ) "blockbuster" because it, too, was about nothing but size. And now don't be surprised if Amgen's Immunex deal goes just as sour. But don't let it sour you on biotech. If this is biotech's attempt to grow up, look elsewhere for biotech companies that think it's a better idea to be like Peter Pan — to just stay a kid forever. In other words, they keep on taking those risks in the hopes of the asymmetric jackpot. That's what has made this high-risk, high-valuation sector a survivor, while other highflying tech sectors have crashed and burned. What went wrong with the e-tech companies being booted out of the Nasdaq 100 is that many of them never had a jackpot to hope for in the first place. Their business models didn't include mechanisms for making profits, no matter how large they became. There was a time when that didn't matter. But now it does. And biotech has got the goods. Cure cancer — or AIDS, or arthritis, or Alzheimer's or anthrax! — and I'll show you a business model that didn't forget about profits. But getting there is about taking risk. Not just getting bigger.

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