From Alchemy to IPO: The Business of Biotechnology|
by Cynthia Robbins-Roth (Author)
Despite unnerving swings in individual stock valuations--or perhaps because of
them--many knowledgeable observers still believe the 21st century will
ultimately earn its stripes as the Age of Biotech. Cynthia Robbins-Roth, named
by Forbes magazine as one of the industry's top insiders, certainly is among
them. And in From Alchemy to IPO, she persuasively argues investors better take
heed because they ain't seen nothin' yet. "Most of us think of biotech as
medicine or genetically engineered crops," writes Robbins-Roth. But in the very
near future, she continues, it also "may make it possible for humans to reach
the stars and to change the environment on other planets." Think that's
far-fetched? She says developments like this are already in early stages and, in
a deliberately proselytizing manner, traces their roots to the current business
nitty-gritty, finally focusing on the long-term moneymaking potential. "The
biotech world will never be an easy place for investors," she cautions, but with
hundreds of ongoing projects "poised to power into the marketplace," there will
be plenty of "opportunities for investors and employees alike." Recommended for
readers seeking an informed tutorial on this field of the future.
From The Industry Standard
In the early 1980s, the biggest concern facing the biotech industry was
collecting enough urine and placenta to conduct crucial genetic research. At one
point Genentech researchers even joked about increasing their urine yield by
laying sawdust on the floor at their weekly beer bashes. The technical
challenges of the Internet industry pale in comparison - and so do the
challenges to Internet investors.
So says Cynthia Robbins-Roth in From Alchemy to IPO, a fascinating, if somewhat
dry, look at how the biotech industry grew from nothing to one of the most
important business sectors in today's economy. Her retelling has important
lessons both for biotech investors and Net investors, who can learn much from
biotech's technology-driven boom-bust cycle.
The biotech sector first grabbed the attention of individual investors in 1980.
The U.S. Supreme Court ruled that genetically altered life could be patented,
Genentech went public and closed at double its offering price of $35, and
suddenly the marriage of technology and biology stepped out of science fiction
novels and into doctors' offices and grocery stores. Just a few years later,
though, impatient investors, who weren't able - or willing - to understand the
often long and expensive process required to turn a test tube reaction into a
viable drug, began dropping out of biotech stocks in droves. Today, Net
investors will be comforted to know that biotech is again booming, as years of
research finally yield concrete results.
As a biochemistry Ph.D, former researcher for Genentech and the founder of
BioVenture Consulting, Robbins-Roth knows from whence she speaks. Steeped in
technological details, her book can be a fascinating read for those enamored of
hard science. However, as an investment guide, complete with stock tickers,
dates of public offerings, partnering history and other minutiae, the book too
often reads like a series of annual reports and would have benefited from the
inclusion of far more case histories and stories.
Robbins-Roth also errs somewhat on the side of industry cheerleading at the
expense of giving a complete portrait of the biotech investing environment.
Early in the book, for example, she talks about the knockout process, in which
researchers turn off certain genes to determine their function. Much of this
research is done on organisms other than humans, often with disastrous results
for the subject. We know from the reaction of consumers in today's marketplace
that many people object to scientific testing on animals, yet Robbins-Roth
skates by with nary a comment. Likewise, she barely touches on controversial
subjects as timely as genetically altered food. To her, it seems, all
discoveries in biotechnology are to the good.
The problem is, the human connection to biotech is far more complicated than
that of simple innovation, and choosing to invest or not in a company is a
complex problem, not only in terms of picking technological winners or losers,
but also in making decisions about work that goes to our very essence. When one
company finds a better drug delivery system for diabetics, or an experimental
gene therapy for cancer patients, it affects, for better or worse, everyone.
The Net is only beginning to force investors to ask similar questions. Toward
the end of the book, the author rhetorically asks whether one should invest in a
cure for Alzheimer's or the latest online idea to deliver dog food. The cure
gets Robbins-Roth's vote, but often as not in real life, it's the dogs who win
out, at least in the short term. A less facile book might have helped us better
understand why that is.
Paperback: 272 pages
Publisher: Perseus Books Group; 1 edition (April 10, 2001)