Follow-on market poised for comeback, at least temporarily

Follow-ons have been down during the pandemic, but inflows to biotech signal coming demand

Pandemic-driven market volatility has stymied follow-on activity the past two months, but stabilizing markets and big inflows are opening a window of opportunity, at least in the near term. The unfolding consequences of COVID-19 could close the window again at any moment, suggesting biotechs may want to raise funds now.

As the scope and gravity of the coronavirus crisis became apparent from the end of February to early March, the market reaction was swift and severe. In the span of one month, the S&P 500 and Dow Jones Industrial Average (DJIA) lost one-third of their value, with multiple days that featured double-digit percentage losses. The volatility during that period was through the roof, with

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