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Industry growth in innovation could spark financial rebound.
As 2021 ends, I find it hard to believe that we are still living on a daily basis with the ravages of COVID, despite the availability of life-saving vaccines and therapeutics—thanks to the tireless efforts of the biopharma ecosystem!
Just this week, leaders in the biopharma and finance industries implored JPMorgan to cancel its live Healthcare Conference, our venerable annual Woodstock. I host a Fabulous Pharma Females dinner there every year; my last was in January 2020, which seems like a lifetime ago. The hybrid virtual/in-person world we now live in no longer seems temporary, but rather the new “normal.”
Two years in, and the system is still in chaos. In my own little world, I move from one place with no masks to the next where wearing one is required. Proof of vaccination and frequent testing requirements are the new passports to navigating the world.
Following the reopening trade that propelled stocks and the markets to new highs, we were hit with the Delta variant, and walked it all back. Now, we are in the early stages of Omicron, which the WHO has designated a “variant of concern.”
While supplies of vaccines may be available in large quantities, many around the world still can’t get them—case in point, in South Africa, where travel bans are now in place, as they are in some countries in Europe as well as Japan.
As I write this, the S&P 500 is up more than 25% YTD, and the NASDAQ, which ran up 43.6% last year, is ahead another 24.6%. The S&P Biotech index (XBI), on the other hand, is down 13.4% this year following an epic gain of 48% in 2020. Despite this underperformance for biotech, the IPO market has continued to be strong, both in terms of number of deals—already beating last year’s record and dollars raised. Why?
There have been standout performers this year, one notable is Pfizer. Since the start of 2020, its shares have skyrocketed 80% to $54, adding $754 billion in market cap.
Geoff Porges at Leerink forecasts that cumulative sales of Pfizer’s Comirnaty vaccine will total $107 billion by the end of 2022. He further estimates that Pfizer’s cash balance could swell to over $76 billion from the current $29.7 billion (assume liquidation of its 32% ownership of GSK’s consumer business, or $60 billion without it).
Barbara Ryan is Founder, Barbara Ryan Advisors, and a member of Pharm Exec’s Editorial Advisory Board