Ebb & Flow

Last week's IPO by oncology play Aveo Pharmaceuticals Inc. (NASDAQ:AVEO) provides a benchmark for biotechs hoping to go public in this window - although it's certainly not the benchmark they wanted.

Aveo priced at $9 and sold 9 million shares. It had aimed to sell 7 million shares at $13-$15. At $14, the company would have raised $98 million and been valued at $387 million. Instead, Aveo raised $81 million for a market cap of $266.8 million. That gives it a pre-money valuation of $185.8 million...