Bearing down in turbulent markets: a Perspective
Why companies should plan bear market survival strategies, even if we’re not there yet
Three years ago, the biopharma sector was in the throes of one of the worst bear markets in its 40-plus year history, forcing many companies to adopt survival tactics to keep the lights on. While we haven’t re-entered bear territory (yet), the next few quarters will be dominated by uncertainty, and small-cap companies in particular should prepare to revisit those survival measures.
Objectively, the public markets have not been terrible in 1Q25, in contrast to the sector’s experience in 1H22. At this time three years ago, the XBI had fallen 48% from its February 2021 peak, with investors “selling the news,” using positive catalysts as a way to reduce or get out of biotech positions. Sentiment was awful, and conversations with buysiders were not fun...