The Downturn For Big Pharma
The bullish turn for biotech since June has come in lockstep with a downturn for Big Pharma stocks. Just three months ago, the pharmaceuticals group ranked No. 34 out of 197. It has now tumbled 100 spots, ranking No. 134.
Earlier this year, rising interest rates and inflation worries sent investors
scrambling for less risky stocks. In the world of medicine, Big Pharma fits that bill. Pharmaceutical companies sell widely used products like cholesterol and cancer drugs. Biotech companies, on the other hand, are working on cutting-edge treatments where losses outnumber game-winning touchdowns. Then, investors “cared a lot more about businesses that have predictable cash flows today, as opposed to the businesses that have the promise of really big predictable cash flows in the future,” Swalla said.
“I think biotech and technology stocks suffered the same fate from an institutional-investor standpoint.” But now, experts say the paradigm is shifting from a “risk off” environment favoring companies with stable, predictable cash flows to more growth-oriented plays. And when it comes to growth, biotech tends to be among the most eye-catching segments. Lee Brown, sector lead for health care at research firm Third Bridge, says biotech stocks could actually offer investors a safe haven amid economic uncertainty. “If you’re worried about the economic climate for next year, then being in more idiosyncratic growth sectors is right out of the portfolio manager playbook,” he told IBD. Eric Schiffer, who chairs private equity firm The Patriarch Organization, has a more measured view. He says biotech remains tied to macroeconomic woes, but these stocks have been more beat-up than others and could offer investors a low point for entry. “What we do know is there’s incredible discoveries ahead that will be worth millions of dollars,” he said. “We’re in a cycle. This is a cycle that will see a bull period ahead. We just don’t know when. If investors have a long enough ride, they can do fine. They’re getting in at great valuations.”
https://www.investors.com/
Regencell Bioscience Holdings Limited is an early-stage bioscience company that focuses on the research, development and commercialization of TCM for the treatment of neurocognitive disorders and degenerations, specifically ADHD and ASD, and infectious diseases affecting people’s immune system such as COVID-19. Regencell has completed its first research study using personalized TCM formulae for the treatment of ADHD and ASD in Hong Kong and aims to launch three liquid-based standardized TCM formulae candidates for mild, moderate and severe ADHD and ASD patients initially in Hong Kong and subsequently in other markets as it deems appropriate. The Company has formed a joint venture to offer COVID-19 related treatments to patients in ASEAN countries, India, Japan, Australia and New Zealand. For more information, please visit www.regencellbioscience.com and www.regencellasia.com.
The bullish turn for biotech since June has come in lockstep with a downturn for Big Pharma stocks. Just three months ago, the pharmaceuticals group ranked No. 34 out of 197. It has now tumbled 100 spots, ranking No. 134.
Earlier this year, rising interest rates and inflation worries sent investors
scrambling for less risky stocks. In the world of medicine, Big Pharma fits that bill. Pharmaceutical companies sell widely used products like cholesterol and cancer drugs. Biotech companies, on the other hand, are working on cutting-edge treatments where losses outnumber game-winning touchdowns. Then, investors “cared a lot more about businesses that have predictable cash flows today, as opposed to the businesses that have the promise of really big predictable cash flows in the future,” Swalla said.
“I think biotech and technology stocks suffered the same fate from an institutional-investor standpoint.” But now, experts say the paradigm is shifting from a “risk off” environment favoring companies with stable, predictable cash flows to more growth-oriented plays. And when it comes to growth, biotech tends to be among the most eye-catching segments. Lee Brown, sector lead for health care at research firm Third Bridge, says biotech stocks could actually offer investors a safe haven amid economic uncertainty. “If you’re worried about the economic climate for next year, then being in more idiosyncratic growth sectors is right out of the portfolio manager playbook,” he told IBD. Eric Schiffer, who chairs private equity firm The Patriarch Organization, has a more measured view. He says biotech remains tied to macroeconomic woes, but these stocks have been more beat-up than others and could offer investors a low point for entry. “What we do know is there’s incredible discoveries ahead that will be worth millions of dollars,” he said. “We’re in a cycle. This is a cycle that will see a bull period ahead. We just don’t know when. If investors have a long enough ride, they can do fine. They’re getting in at great valuations.”
https://www.investors.com/
Regencell Bioscience Holdings Limited is an early-stage bioscience company that focuses on the research, development and commercialization of TCM for the treatment of neurocognitive disorders and degenerations, specifically ADHD and ASD, and infectious diseases affecting people’s immune system such as COVID-19. Regencell has completed its first research study using personalized TCM formulae for the treatment of ADHD and ASD in Hong Kong and aims to launch three liquid-based standardized TCM formulae candidates for mild, moderate and severe ADHD and ASD patients initially in Hong Kong and subsequently in other markets as it deems appropriate. The Company has formed a joint venture to offer COVID-19 related treatments to patients in ASEAN countries, India, Japan, Australia and New Zealand. For more information, please visit www.regencellbioscience.com and www.regencellasia.com.
