Dave:
Thanks, but don't own any. Like Doc, just been watching. Valuable lesson for the nuts who jump in and short a biotech "just because".
This goes back to old discussions with Poodle at the origins of the parent T/FIF thread (or BVF or ???). The "what goes up must come down" mentality became accepted from watching repeated events, post 1997. Situations change, and we've gone from having research valued at $0 to achieving a decent premium. Many companies are still dirt cheap, however. A few of them started kicking today.
The lesson is simple.... biotechs go through extremes in the valuation of projects that address $multi-billion markets. You don't want to short a stock like BCRX after a protracted period of discounted research premiums. All of the naive newbies who got used to being correct are getting squashed.
I said somewhere (BVF? or valuation?), a few months ago, that we were headed back to 1991 premiums. Everything was set.... aging boomers, empty pharma pipelines, products going off patent, market fragmentation, etc. A bit of historical perspective is useful.
Rick |
