Hot topic: Biotech’s winter: this too shall pass

Sometimes trying times just seem to go on and on. The tunnel does have an end, we know, but no light can be seen. 

There have been mutterings to that effect from many in the world of biotech and life science investment over the last few months. 

Private mutterings have grown into louder grumbles, despite the risk that we talk the sector down – which is in few people’s interests. 

There’s no need to rehearse the reasons for recent unease here. They are well known. 

But as the old Persian saying goes: “This too shall pass.” 

When the good times are rolling it seems like they will never stop – but they do, often pretty suddenly. 

The same is true of bad times. 

If sentiment has become so negative that few have faith that it will stage a meaningful recovery in the near or even medium term, then that does beg the question: is now a good time to buy? 

The market funk might be resulting in a lack of exits, causing less money to be available to recycle into new investments. But there’s still plenty of cash sitting on the sidelines, for instance in VC funds, that has yet to be deployed. 

Of course, there is the risk of going too early, the risk that biotech’s winter drags on, and that valuations continue to drag and even drop.  This too shall pass – but we don’t know exactly when. 

There is, however, another risk: the risk of missing out on great opportunities, because when markets do turn, they can turn with surprising speed.