Today's discussion re: biotech .vs. internet by the
pundits here are characterizing biotech in the traditional
mode, the mode that prevailed in the past few years:
Get a bunch of compounds, test them for possible use
against various diseases, etc. So there are a bunch
of public one-drug or two-drug companies that have a slow
cash burn rate, once in a while one will stumble across
a compound that isn't too toxic and that has a bit of an
effect.
Still, nobody really likes to invest in that sort of research, lottery tickets unless you can combine the
commercialization of a few successful drugs. This lottery
model is appropriate for the many $1/$10/$30 type of spike
stocks that will come up on the news.
This isn't the paradigm at work in this rally.
(background music, please)
The genomic scientific groundbreaking is coming
at internet speed because it is catalysed by the same
technologies that catalysed the computer industry. The
most spectacular qualcom-like run-ups are precisely in those
stocks that are developing the tools to manage the gene
infiormation, i.e. Celera, Affimetrix, Incyte,
GeneLogic, HGSI, Vical, etc. Although development in
these companies has been known for some time, only recently
have we gotten the milestone anouncements that seem to mark
the beginning of a very productive era.
Besides, all those other tech stocks were getting pretty
boring and repititious, not to mention the ridiculous alphabet soup the VC software vagabonds have been creating. -g-. |
