Biotech Values

[DewDiligence]

How Biotech Investing Has Changed in the Past Decade

Revisiting the Genaera story this afternoon highlights one way in which biotech investing has changed a lot in the past decade or so. I doubt that a company whose sole asset was a sexy story like the one peddled by Genaera would gain traction with serious biotech investors today.

Now, emerging biotech companies that manage to survive without genuinely innovative science have the financial acumen—or the lack of ethics—to prolong their corporate lives through repeated pump & dump maneuvers that are facilitated by such pseudo-independent outfits as biomedreports.com. CTIC, RPRX, and AEN are prototypes for the later type of company.

Genaera was unable to master the pump & dump game to the same degree as the aforementioned firms, and that’s why it eventually went bust. All told, I think it’s fair to say that Genaera disappeared quickly not because it was a big scam, but rather because it was not scammy enough.