As this week's cover story reports, executives of the next class of IPOs are building new investment stories based on more hard-bitten realism about investor demands for realistic valuations, clinical progress and portfolio breadth.

These are the kinds of stories we advocated in December, when BioCentury offered The Clear Route to ROI as a management model for the creation of shareholder value. In a nutshell, investors are keeping valuations low until risk is wrung out of a stock. The challenge to companies is to alter investor perceptions of the risk/reward ratio so that they invest now, rather than later. The Clear Route approach proposes that companies must provide investors with strong comfort that risk is both understood and under proactive management. We call this message The Clear Route to ROI.