The next wave of biotech growth — a Perspective

Over the past 15 years, biotech investors have chased trends where the promise of scientific breakthroughs hasn’t translated into commercial success, or if it has, the value creation of the innovation has been largely devoured by a few large pharmas rather than the biotechs that pioneered the programs. But I think the next wave of growth will be fueled by biotechs’ independent launches of new therapeutics that generate meaningful sales — and therefore value accretion — to create the next group of Biogens, Gileads, Regenerons and Vertexes. It’s a sign of the sector’s maturation.

We’re all familiar with the big trends of the past 15 years: immuno-oncology, gene therapy and gene editing, obesity. For the PD-1s and CAR-T therapies, commercial success was limited to a handful of large biopharmas, with a lot of capital invested to chase the next immuno-oncology target that so far has little to show for it. Gene therapy or CRISPR technologies hold huge promise for curing a wide swath of diseases, yet still struggle to establish a commercially viable model amidst a host of safety challenges...