With so much information and a lack of accurate information, it is hard for our society to understand exactly what to do and not do. We have seen this with the ‘panic’ buying of toilet paper and water. We have also seen it with those that are doing nothing. Most people fall in between these areas. We understand that we must wash our hands more often than in the past…and do it rigorously. We hear simple and effective advice from the CDC to help prevent the spread of this virus: sneeze or cough in your elbow, don’t touch your face, stay more than 6ft from others, and if you are sick…stay home. Many of our clients have their employees working from home and are taking steps from having their companies go down. For companies in the ‘essential’ industries, like BioTech, they are working around the clock to help our country.
BioTech industry stocks were starved for love on Wall Street in recent years, notwithstanding revolutionary research and the launch of novel therapies for once incurable diseases.
Not anymore. The catastrophic outbreak of Covid-19 has led to a reappraisal of the sector, even if viable treatments and vaccines seem far off. Sure, biotech stocks tanked this past month, but the iShares Nasdaq Biotechnology exchange-traded fund (ticker: IBB) and other industry benchmarks have been outperforming the broader market.
The industry’s reversal of fortune is no surprise to Eli Casdin, founder and chief investment officer of Casdin Capital, a New York–based hedge fund specializing in life-sciences investments. Casdin, considers life sciences, including biotech, the biggest growth story of the next decade. “A lot of value has been taken out of the sector,” he says. “Investors should recognize that an industry with a lot of growth ahead isn’t going to sustain disruption in the same way that much of the legacy economy will. And companies with strong balance sheets and management teams will carry the day,”
Eli Casdin goes on, ‘Many people in the industry are on the front lines and caring for patients. Also, like the rest of the economy, the industry is experiencing severe disruptions. As hospitals focus on the emergent sick, nonessential treatments are put on hold. People selling new medicines, medical devices, and diagnostics can’t visit customers, and clinical-trial recruitments are being delayed or halted because hospitals are overwhelmed, patients are too at-risk to go to hospitals to get these treatments, or the treatments require coordination and resources that just can’t be spared right now.
BioTech will help the world get out of this crisis. It has its challenges right now, but the opportunities are enormous. In this time, it is imperative that we work together, tech-government-research-finance, to find a cure and save lives. There is much hope with companies like HaloVax and Voltron Therapeutics teaming up to find a vaccine to stop COVID-19.
Blue Street Capital is committed to providing massive value to our BioTech clients through our resources, knowledge, and experience. We can get through this TOGETHER. We can become stronger TOGETHER.