If one is going to take the time to invest in the sector of biotechnology, the learning curve of all the medical implications, target markets and practical application which will lead to earnings is more than most want to dive into.
The same is really true of the company's we discuss here every day. To me, biotech, while a really fascinating field from an academic perspective, is really scary from an investing perspective. A particular company might look good because it recently hit some particular win, but where will it be five years from now? Next year's hot company is just so many wishes and hopes. If one was a deep insider, one might know about a company that had some really hot prospective product in advance ... but then there is the approval hurdle that we don't have with silicon and software and distressingly often it turns out that the oh so promising new biotech discovery doesn't quite do what people thought it did or has unpleasant aspects which make its use questionable.
BTW, I have a sort of connection to the arbitrariness of the approval process. This is not to say that the uncertainty stems only from arbitrariness, by any means since often that which is rejected has problematic side effects or has been insufficiently tested. But, it can work the other way too.
Years back, my father had a connection with a fellow who had developed a process for converting "trash" fish, the stuff that got caught up in the nets in the course of normal fishing, but which were not saleable, into a very high protein "flour". Mixed in with the local flour from whatever grain, it made a great protein supplement to native diets at very low production cost and very low cultural cost since, if delivered mixed with whatever was the local "flour", it was basically undetectable and unlikely to transgress any local taboos. However, the inventor of this process fought for years to get FDA approval for this process (my father was an occasional witness) and, from the last I had heard, never succeeded because contrary witnesses would show up with pictures worthy of anti-abortion media ... I suppose that there must have been some lobby working against this concept. As far as I know, the process has never been approved by the FDA. It can and is used elsewhere, notably in India, but understandably there are a lot of other governments who wonder why this thing that is being peddled doesn't have FDA approval and thus are reluctant to support it, even though a low cost source of protein supplements would clearly be beneficial to their population.
There is certainly a lot of nonsense about what gets accepted in high tech ... but I don't think it holds a candle to biotech. |
