Rational retail in Japan

The 2012 Japanese biotech bubble was fueled by irrational retail exuberance over a Nobel Prize awarded to a stem cell academic, but retail investors now are largely rewarding companies based on news events or upcoming milestones. As a result of the altered behavior, companies could have an easier time maintaining and growing their valuations on the heels of a strong first quarter.

BioCentury's equal price-weighted index of 34 Japanese biotechs was up 40% in 1Q16. The index gained an additional 15% in April (see "BioCentury Japan vs. BioCentury 100"). ...