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Biotech / Medical : Trickle Portfolio
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To: tuck who started this subject10/31/2000 10:34:41 AM
From: Biomaven  Read Replies (1) of 1784
 
Tuck,

The trickle-down argument goes something like this:

1. The biotechs are on track to raise $30 billion in the equity markets this year.

2. They are going to be spending that money over the next three or four years.

3. Who gets the money? Most goes on salaries, lawyers, investment bankers, landlords etc. However a fair chunk will also go to "useful" activities, where "useful" is here narrowly defined as "we can make some money from it." <g>

4. Although there is some lag, the CRO's are one obvious beneficiary. (For example, in the case of SEPR, the majority of the R&D budget is spent on CRO's.) Lab equipment is a play you've already focused on. Less obvious plays like INCY and AFFX should also benefit, as well as other "service" companies like ARQL or Albany Molecular.

Peter
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