BIOTECH: Stock Surge Predicted to Continue
The end of 1999 proved profitable to the biotech industry, as investor enthusiasm buoyed stocks -- a trend that is likely to continue into 2000, reports the Los Angeles Times. Analysts predict that initial public offerings of biotech stocks will increase in the new year as a result of interest generated in smaller biotech firms by larger companies' successes. But, they caution, prices for biotech stocks are volatile, as they are almost guaranteed to fall when a drug is rejected by regulators or proves disappointing. Still, the Amex Biotech Index and the more comprehensive Nasdaq Biotech Index rose more than 100% in 1999, with plenty of room to grow, according to analysts. Some of the recent growth can be attributed to health care investors diverting their funds from stagnant pharmaceutical companies into the more active biotech firms. But even with the rapid growth experts worry that a "growing sentiment against biotech foods and crops 'will spill over into biotech generally'" and that the ethical implications raised by the research could "plague" the industry (Jacobs, 1/4).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.