Biotech Values

[iwfal]

You would still likely have more robust Phase 2 data from the more legit companies than from the wannabes.

That hasn't worked well in medical devices. Does anyone here invest in medical devices? My guess is generally not - because a much higher percentage of it is trash, and it is very very hard to tell the trash from the good when there is very little good science enforced. Instead it is much more random chance and driven by company ability to market - much of the medical devices market is a wild wild west.

And, in any event, again, I would think that over time the marketplace would sort out those drugs that ultimately have the more meaningful impact and reward accordingly (i.e., the rigorous data that may not be fully present in Phase 2 would ultimately get borne out once drugs on the market

1) [Sarcasm] Like all the DMD patients clamoring for SANN's drug vs SRPT's? [/Sarcasm] (sorry) Once rigor is off the table it is political savvy and marketing that matter (as has very visibly played out in SRPT vs SANN). >90% of humans are, literally, unable to see the emperor's lack of clothes. Another example has been avastin in BC - the only reason it got withdrawn was phase 4 trials (the in-the-market data was nowhere near perceptive enough to force a withdrawl).

2) on-the-market evidence (aka epidemiological data), like historical comparison data, is inherently incapable of detecting 'small' differences (epi data with a HR of worse than about 0.75 is something that probably almost everyone on this board treats very cynically because we all know it means very little). I'd suggest it also is why you personally don't treat historical comparison ph2s as worthy of a gamble in ph3. Yeah, a bigger data set helps - but it is an uncontrolled data set and thus net-net not much better.

would suggest that what you are positing is more a theoretical LT concern for the industry. In the ST, my gut is the market would likely reward the industry with higher valuations if approvals prove to be easier going forward, particularly small-cap biotech.

Agree that there would likely be a short term boost - because anyone and everyone will get on the market and be able to charge through the roof (e.g. SRPT). But that brings medical cost controls all the sooner - and to all players. I.e. the boost will be temporary, then we hit massive implosion as the country realizes we're paying a fortune and 70% of the new drugs are actually worse than useless. (that said, as I noted earlier, it might be best overall if we went back to 50's standards in order to reach sanity again the quickest. But from about year 3 or 4 I'd expect the market to be largely unplayable - and with a looming disaster)

Note: I believe the difference in perspectives here is that your investment style is to try to anticipate the buzz. I have no inherent objection to this, but think it is ultimately very bad for the market and very bad for the country to suppose this ends well if the focus moves from science to buzz (i.e. marketing and politics). (Note that I have been surprised to watch multiple biotech investors morph from a science focus to a buzz focus during the big boom.)