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Biotech / Medical : HuMAB companies

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To: nigel bates who wrote (158)	5/18/2001 9:44:54 AM
From: aknahow	Read Replies (1) of 1022

There were so many post promoting the advantages of having lots of cash, I was inhibited from posting my true feeling. In periods of low interest rates, "cash is trash". This holds true even more so for a biotech company that can't try to increase the spread on this asset by exotic investments. Those that sold fixed rate debt or even convertible debt at a percentage over an index are hurt even more. And as long as rates are low there is a great probability that tolerance for risk will grow and anyone wishing to float an IPO will be able to do so. Yeah, I have read the articles saying this is not the case, now. But give the markets a bit of time to adjust to seeing nothing but paltry investment returns on cash far into to the future and the desire to take on risk grows fast. Just as in the oil industry, biotechs, with too much cash may end up with a negative premium, being seen as having too few projects into which to deploy cash.

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