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Good Stocks To Invest In Now? 4 Blue Chip Stocks To Buy According To Analysts

Here are four top stocks to buy in the stock market today according to analysts.
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Blue chip stocks are highly valued shares of large, well-established, and financially sound companies. They are called blue chips because they are considered some of the safest and most reliable investments in the stock market. Blue chip stocks tend to be less volatile than other stocks, and they often offer high dividend yields.

For these reasons, blue chips are often favored by conservative investors who are looking for stability and income. While they may not offer the same growth potential as other stocks, top blue chip stocks are an excellent choice for risk-averse investors who are looking for stability and consistent returns. If you’re now keen on researching blue-chip stocks to buy [or avoid] now, here are four to watch in the stock market today.

Blue Chip Stocks To Buy [Or Avoid] Today

1. AutoZone (AZO)

First up, AutoZone Inc. (AZO) is one of the largest retailers and distributors of automotive replacement parts and accessories in the United States. Specifically, the company sells items like automotive replacement parts, chemicals, tools, equipment, and accessories through its AutoZone stores and AutoZone Online. As of today, AutoZone operates over 6,100 retail locations throughout the United States.

AutoZone (AZO) Recent Stock News

On Monday of this week, AutoZone reported a beat for its fourth quarter 2022 financial results. In the report, AutoZone reported Q4 2022 earnings per share of $40.41 per share, with a revenue of 5.3 billion. This came in better than analysts estimated for the quarter, which was earnings of $38.38 per share, and revenue of $5.2 billion. In addition, the company posted a revenue increase of 8.9% during the same period, in 2021.

Bill Rhodes, Chairman, President, and Chief Executive Officer said this in his letter to shareholders, “Our results are a testament to our AutoZoners’ ongoing commitment to delivering exceptional customer service every day.  Our retail business performed well this quarter ending with positive same-store sales on top of last year’s strong performance.  And, our commercial business growth continued to be exceptionally strong at 22%. The investments we have made in both inventory availability and technology are enhancing our competitive positioning.  We are optimistic about our growth prospects heading into our new fiscal year.

Aside from this, today brokerages like Citigroup (NYSE: C), and Jeffries Financial Group (NYSE: JEF) raised their price targets on AutoZone stock. In detail, Citigroup increased its price target on AZO stock from $2,250 per share to $2,520 per share. Meanwhile, Jeffries also raised their price target from $2,350 to $2,450 per share.

AutoZone (AZO) Stock Chart

As of Tuesday mid-morning, shares of AZO stock are up over 1% at $2,120.12 a share. Given its strong quarter, and the street’s reaction, do you think now is a good time to add AutoZone to your watchlist?

AutoZone stock
Source: TD Ameritrade TOS

[Read More] 3 Hydrogen Stocks To Watch In September 2022

2. Apple (AAPL)

Next up, we have consumer tech giant Apple, Inc. (AAPL). This company needs little to no introduction for most, but if you are unfamiliar here’s a brief introduction. Apple is an American multinational technology company. The company designs develop and sell consumer electronics, computer software, and online services. Most notably, a few of Apple’s most popular products are items like the iPhone smartphone, the iPad tablet computer, the Mac personal computer, the Apple Watch smartwatch, and many others.

Apple (AAPL) Recent Stock News

Earlier this month, Apple announced its new product line-up to investors. Specifically, the company announced it will be rolling out a new iPhone® 14 Pro and iPhone 14 Pro Max. In detail, this new iPhone will include additional features such as an Always-On display, and the first-ever 48MP camera on an iPhone, among others. In addition to that, Apple also announced they will be introducing the new Apple Watch® Series 8 and the new Apple Watch SE®.

Additionally, Greg Joswiak, Apple’s senior vice president of Worldwide Marketing, commented, “Our customers count on their iPhone every day, and with iPhone 14 Pro and iPhone 14 Pro Max, we’re delivering more advancements than any other iPhone. iPhone 14 Pro introduces a camera system that empowers every user — from the casual user to the professional — to take their best photos and video, and innovative new technologies like the Always-On display and the Dynamic Island, which offers new interactions for notifications and activities.

Continuing on, just on Tuesday Evercore ISI (NYSE: EVR) reported an outperform rating on Apple. As well as, the brokerage raised its price target on AAPL stock from $185 per share to $190 per share.

Apple (AAPL) Stock Chart

Meanwhile, year-to-date shares of Apple stock are down approximately 13.79% as of Tuesday’s lunchtime session at $156.77 per share. Given Apple’s track record and their new product lineup, is now a good time to add Apple stock to your long-term portfolio?

AAPL stock
Source: TD Ameritrade TOS

3. Norwegian Cruise Line Holdings (NCLH)

After that, let’s move toward cruise line company Norwegian Cruise Line Holdings (NCLH). In brief, Norwegian Cruise Line is the third-largest cruise company in terms of berths globally. For a sense of scale, the company has more than 62,000 berths and operates 29 ships. Moreover, Norwegian Cruise Line operates under three brands, which are Norwegian, Oceania, and Regent Seven Seas. As of May 2022, the company has announced they have redeployed its whole fleet. The company has redeployed its entire fleet as of May 2022.

Norwegian Cruise Line Holdings (NCLH) Recent Stock News

Last month, the company announced its Q2 2022 financial results. In detail, the company reported a second-quarter loss of $1.22 per share, with revenue of $1.2 billion. Meanwhile, analysts’ estimates for Q2 2022 were a loss of $0.87 per share and revenue of $1.3 billion. Additionally, the company closed out the 2nd quarter with $1.9 billion in cash equivalents. This signifies a significant improvement compared to pre-pandemic levels. In fact, NCLH reported a 27,079.1% revenue increase on a year-over-year basis.

Frank Del Rio, President & CEO of Norwegian Cruise Line Holdings said this about the quarter, “We are encouraged by the continued strong consumer demand we are experiencing which is reflected in our record pricing, accelerating booking volumes, especially for 2023 and beyond, and highest ever onboard revenue generation. Having emerged from the pandemic and returning to more normal operations, we remain steadfast in our strategy and commitment to protect our brands’ positioning and industry-leading pricing, which we firmly believe is the best way to maximize long-term value for all our stakeholders.

On Tuesday, the company received an upgrade from hold to buy from Truist Financial (NYSE: TFC). The brokerage raised its price target on NCLH stock from $18 to $19 per share, representing a 23.94% upside.

Norwegian Cruise Line Holdings (NCLH) Stock Chart

Since the start of 2022, NCLH stock has fallen by over 30% at $15.45 per share as of Tuesday afternoon’s trading session. However, over the last month of trading action, shares of Norwegian Cruise Line stock have recovered by approximately 23.11%. All in all, do you think now is a good time to invest in Norwegian Cruise Line Holdings?

NCLH stock
Source: TD Ameritrade TOS

[Read More] Stocks To Invest In Right Now? 3 Lithium Mining Stocks For Your List

4. Humana (HUM)

Last but not least, Humana Inc. (HUM) is one of the largest health insurance companies in the world. In detail, the company offers a variety of health plans, including individual and family plans, as well as Medicare and Medicaid plans. Humana also provides a wide range of other services, such as pharmacy benefits management, dental coverage, and vision care. For a sense of scale, Humana currently has over 20 million customers in the United States.

Humana (HUM) Recent Stock News

Last week Thursday, Humana announced mid-term adjusted earnings per share target of $37 in 2025. Meanwhile, the company also raised its full-year 2022 EPS outlook to approximately $25 per share at its most recent investor day. This would represent a 14% compounded yearly growth rate above Humana’s updated full-year 2022 EPS guidance.

What’s more, Bruce D. Broussard, Humana’s President and Chief Executive Officer at Humana had this to say in his release to shareholders, “We are confident in our ability to deliver compelling, sustainable earnings growth, both in the near and longer-term which will continue to drive shareholder value. Our strong competitive positioning and unique capabilities in the highly attractive individual Medicare Advantage market, coupled with the opportunity to scale and further integrate our CenterWell healthcare services capabilities, positions us for durable leadership in the value-based care industry.

On Tuesday, Morgan Stanley (NYSE: MS) upgraded HUM stock from equal weight to overweight. They also raised their price target from $494 per share to $549 per share.

Humana (HUM) Stock Chart

So far in 2022, Humana has outperformed the broader market as shares are up over 8% year-to-date. On Tuesday’s early afternoon trading session, HUM stock is trading up another 1% at $506.07 per share. With this update, will you be adding Humana stock to your list of stocks to watch today?

HUM stock
Source: TD Ameritrade TOS

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The post Good Stocks To Invest In Now? 4 Blue Chip Stocks To Buy According To Analysts appeared first on Stock Market News, Quotes, Charts and Financial Information | StockMarket.com.

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EyePoint poaches medical chief from Apellis; Sandoz CFO, longtime BioNTech exec to retire

Ramiro Ribeiro
After six years as head of clinical development at Apellis Pharmaceuticals, Ramiro Ribeiro is joining EyePoint Pharmaceuticals as CMO.
“The…

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Ramiro Ribeiro

After six years as head of clinical development at Apellis Pharmaceuticals, Ramiro Ribeiro is joining EyePoint Pharmaceuticals as CMO.

“The retinal community is relatively small, so everybody knows each other,” Ribeiro told Endpoints News in an interview. “As soon as I started to talk about EyePoint, I got really good feedback from KOLs and physicians on its scientific standards and quality of work.”

Ribeiro kicked off his career as a clinician in Brazil, earning a doctorate in stem cell therapy for retinal diseases. He previously held roles at Alcon and Ophthotech Corporation, now known as Astellas’ M&A prize Iveric Bio.

At Apellis, Ribeiro oversaw the Phase III development, filing and approval of Syfovre, the first drug for geographic atrophy secondary to age-related macular degeneration (AMD). The complement C3 inhibitor went on to make $275 million in 2023 despite reports of a rare side effect that only emerged after commercialization.

Now, Ribeiro is hoping to replicate that success with EyePoint’s lead candidate, EYP-1901 for wet AMD, which is set to enter the Phase III LUGANO trial in the second half of the year after passing a Phase II test in December.

Ribeiro told Endpoints he was optimistic about the company’s intraocular sustained-delivery tech, which he said could help address treatment burden and compliance issues seen with injectables. He also has plans to expand the EyePoint team.

“My goal is not just execution of the Phase III study — of course that’s a priority — but also looking at the pipeline and which different assets we can bring in to leverage the strength of the team that we have,” Ribeiro said.

Ayisha Sharma


Remco Steenbergen

Sandoz CFO Colin Bond will retire on June 30 and board member Remco Steenbergen will replace him. Steenbergen, who will step down from the board when he takes over on July 1, had a 20-year career with Philips and has held the group CFO post at Deutsche Lufthansa since January 2021. Bond joined Sandoz nearly two years ago and is the former finance chief at Evotec and Vifor Pharma. Investors didn’t react warmly to Wednesday’s news as shares fell by almost 4%.

The Swiss generics and biosimilars company, which finally split from Novartis in October 2023, has also nominated FogPharma CEO Mathai Mammen to the board of directors. The ex-R&D chief at J&J will be joined by two other new faces, Swisscom chairman Michael Rechsteiner and former Unilever CFO Graeme Pitkethly.

On Monday, Sandoz said it completed its $70 million purchase of Coherus BioSciencesLucentis biosimilar Cimerli sooner than expected. The FDA then approved its first two biosimilars of Amgen’s denosumab the next day, in a move that could whittle away at the pharma giant’s market share for Prolia and Xgeva.

Sean Marett

BioNTech’s chief business and commercial officer Sean Marett will retire on July 1 and will have an advisory role “until the end of the year,” the German drugmaker said in a release. Legal chief James Ryan will assume CBO responsibilities and BioNTech plans to name a new chief commercial officer by the end of the month. Marett was hired as BioNTech’s COO in 2012 after gigs at GSK, Evotec and Next Pharma, and led its commercial efforts as the Pfizer-partnered Comirnaty received the first FDA approval for a Covid-19 vaccine. BioNTech has also built a cancer portfolio that TD Cowen’s Yaron Werber described as “one of the most extensive” in biotech, from antibody-drug conjugates to CAR-T therapies.

Chris Austin

→ GSK has plucked Chris Austin from Flagship and he’ll start his new gig as the pharma giant’s SVP, research technologies on April 1. After a long career at NIH in which he was director of the National Center for Advancing Translational Sciences (NCATS), Austin became CEO of Flagship’s Vesalius Therapeutics, which debuted with a $75 million Series A two years ago this week but made job cuts that affected 43% of its employees six months into the life of the company. In response to Austin’s departure, John Mendlein — who chairs the board at Sail Biomedicines and has board seats at a few other Flagship biotechs — will become chairman and interim CEO at Vesalius “later this month.”

BioMarin has lined up Cristin Hubbard to replace Jeff Ajer as chief commercial officer on May 20. Hubbard worked for new BioMarin chief Alexander Hardy as Genentech’s SVP, global product strategy, immunology, infectious diseases and ophthalmology, and they had been colleagues for years before Hardy was named Genentech CEO in 2019. She shifted to Roche Diagnostics as global head of partnering in 2021 and had been head of global product strategy for Roche’s pharmaceutical division since last May. Sales of the hemophilia A gene therapy Roctavian have fallen well short of expectations, but Hardy insisted in a recent investor call that BioMarin is “still very much at the early stage” in the launch.

Pilar de la Rocha

BeiGene has promoted Pilar de la Rocha to head of Europe, global clinical operations. After 13 years in a variety of roles at Novartis, de la Rocha was named global head of global clinical operations excellence at the Brukinsa maker in the summer of 2022. A short time ago, BeiGene ended its natural killer cell therapy alliance with Shoreline Biosciences, saying that it was “a result of BeiGene’s internal prioritization decisions and does not reflect any deficit in Shoreline’s platform technology.”

Andy Crockett

Andy Crockett has resigned as CEO of KalVista Pharmaceuticals. Crockett had been running the company since its launch in 2011 and will hand the keys to president Ben Palleiko, who joined KalVista in 2016 as CFO. Serious safety issues ended a Phase II study of its hereditary angioedema drug KVD824, but KalVista is mounting a comeback with positive Phase III results for sebetralstat in the same indication and could compete with Takeda’s injectable Firazyr. “If approved, sebetralstat may offer a compelling treatment option for patients and their caregivers given the long-standing preference for an effective and safe oral therapy that provides rapid symptom relief for HAE attacks,” Crockett said last month.

Steven Lo

Vaxart has tapped Steven Lo as its permanent president and CEO, while interim chief Michael Finney will stay on as chairman. Endpoints News last caught up with Lo when he became CEO at Valitor, the UC Berkeley spinout that raised a $28 million Series B round in October 2022. The ex-Zosano Pharma CEO had a handful of roles in his 13 years at Genentech before his appointments as chief commercial officer of Corcept Therapeutics and Puma Biotechnology. Andrei Floroiu resigned as Vaxart’s CEO in mid-January.

Kartik Krishnan

Kartik Krishnan has taken over for Martin Driscoll as CEO of OncoNano Medicine, and Melissa Paoloni has moved up to COO at the cancer biotech located in the Dallas-Fort Worth suburb of Southlake. The execs were colleagues at Arcus Biosciences, Gilead’s TIGIT partner: Krishnan spent two and a half years in the CMO post, while Paoloni was VP of corporate development and external alliances. In 2022, Krishnan took the CMO job at OncoNano and was just promoted to president and head of R&D last November. Paoloni came on board as OncoNano’s SVP, corporate development and strategy not long after Krishnan’s first promotion.

Genesis Research Group, a consultancy specializing in market access, has brought in David Miller as chairman and CEO, replacing co-founder Frank Corvino — who is transitioning to the role of vice chairman and senior advisor. Miller joins the New Jersey-based team with a number of roles under his belt from Biogen (SVP of global market access), Elan (VP of pharmacoeconomics) and GSK (VP of global health outcomes).

Adrian Schreyer

Adrian Schreyer helped build Exscientia’s AI drug discovery platform from the ground up, but he has packed his bags for Nimbus Therapeutics’ AI partner Anagenex. The new chief technology officer joined Exscientia in 2013 as head of molecular informatics and was elevated to technology chief five years later. He then held the role of VP, AI technology until January, a month before Exscientia fired CEO Andrew Hopkins.

Paul O’Neill has been promoted from SVP to EVP, quality & operations, specialty brands at Mallinckrodt. Before his arrival at the Irish pharma in March 2023, O’Neill was executive director of biologics operations in the second half of his 12-year career with Merck driving supply strategy for Keytruda. Mallinckrodt’s specialty brands portfolio includes its controversial Acthar Gel (a treatment for flares in a number of chronic and autoimmune indications) and the hepatorenal syndrome med Terlivaz.

David Ford

→ Staying in Ireland, Prothena has enlisted David Ford as its first chief people officer. Ford worked in human resources at Sanofi from 2002-17 and then led the HR team at Intercept, which was sold to Italian pharma Alfasigma in late September. We recently told you that Daniel Welch, the former InterMune CEO who was a board member at Intercept for six years, will succeed Lars Ekman as Prothena’s chairman.

Ben Stephens

→ Co-founded by Sanofi R&D chief Houman Ashrafian and backed by GSK, Eli Lilly partner Sitryx stapled an additional $39 million to its Series A last fall. It has now welcomed a pair of execs: Ben Stephens (COO) had been finance director for ViaNautis Bio and Rinri Therapeutics, and Gordon Dingwall (head of clinical operations) is a Roche and AstraZeneca vet who led development operations at Mission Therapeutics. Dingwall has also served as a clinical operations leader for Shionogi and Freeline Therapeutics.

Steve Alley

MBrace Therapeutics, an antibody-drug conjugate specialist that nabbed $85 million in Series B financing last November, has named Steve Alley as CSO. Alley spent two decades at Seagen before the $43 billion buyout by Pfizer and was the ADC maker’s executive director, translational sciences.

→ California cancer drug developer Apollomics, which has been mired in Nasdaq compliance problems nearly a year after it joined the public markets through a SPAC merger, has recruited Matthew Plunkett as CFO. Plunkett has held the same title at Nkarta as well as Imago BioSciences — leading the companies to $290 million and $155 million IPOs, respectively — and at Aeovian Pharmaceuticals since March 2022.

Heinrich Haas

→ Co-founded by Oxford professor Adrian Hill — the co-inventor of AstraZeneca’s Covid-19 vaccine — lipid nanoparticle biotech NeoVac has brought in Heinrich Haas as chief technology officer. During his nine years at BioNTech, Haas was VP of RNA formulation and drug delivery.

Kimberly Lee

→ New Jersey-based neuro biotech 4M Therapeutics is making its Peer Review debut by introducing Kimberly Lee as CBO. Lee was hired at Taysha Gene Therapies during its meteoric rise in 2020 and got promoted to chief corporate affairs officer in 2022. Earlier, she led corporate strategy and investor relations efforts for Lexicon Pharmaceuticals.

→ Another Peer Review newcomer, Osmol Therapeutics, has tapped former Exelixis clinical development chief Ron Weitzman as interim CMO. Weitzman only lasted seven months as medical chief of Tango Therapeutics after Marc Rudoltz had a similarly short stay in that position. Osmol is going after chemotherapy-induced peripheral neuropathy and chemotherapy-induced cognitive impairment with its lead asset OSM-0205.

→ Last August, cardiometabolic disease player NeuroBo Pharmaceuticals locked in Hyung Heon Kim as president and CEO. Now, the company is giving Marshall Woodworth the title of CFO and principal financial and accounting officer, after he served in the interim since last October. Before NeuroBo, Woodworth had a string of CFO roles at Nevakar, Braeburn Pharmaceuticals, Aerocrine and Fureix Pharmaceuticals.

Claire Poll

Claire Poll has retired after more than 17 years as Verona Pharma’s general counsel, and the company has appointed Andrew Fisher as her successor. In his own 17-year tenure at United Therapeutics that ended in 2018, Fisher was chief strategy officer and deputy general counsel. The FDA will decide on Verona’s non-cystic fibrosis bronchiectasis candidate ensifentrine by June 26.

Nancy Lurker

Alkermes won its proxy battle with Sarissa Capital Management and is tinkering with its board nearly nine months later. The newest director, Bristol Myers Squibb alum Nancy Lurker, ran EyePoint Pharmaceuticals from 2016-23 and still has a board seat there. For a brief period, Lurker was chief marketing officer for Novartis’ US subsidiary.

→ Chaired by former Celgene business development chief George Golumbeski, Shattuck Labs has expanded its board to nine members by bringing in ex-Seagen CEO Clay Siegall and Tempus CSO Kate Sasser. Siegall holds the top spots at Immunome and chairs the board at Tourmaline Bio, while Sasser came to Tempus from Genmab in 2022.

Scott Myers

→ Ex-AMAG Pharmaceuticals and Rainier Therapeutics chief Scott Myers has been named chairman of the board at Convergent Therapeutics, a radiopharma player that secured a $90 million Series A last May. Former Magenta exec Steve Mahoney replaced Myers as CEO of Viridian Therapeutics a few months ago.

→ Montreal-based Find Therapeutics has elected Tony Johnson to the board of directors. Johnson is in his first year as CEO of Domain Therapeutics. He is also the former chief executive at Goldfinch Bio, the kidney disease biotech that closed its doors last year.

Habib Dable

→ Former Acceleron chief Habib Dable has replaced Kala Bio CEO Mark Iwicki as chairman of the board at Aerovate Therapeutics, which is signing up patients for Phase IIb and Phase III studies of its lead drug AV-101 for pulmonary arterial hypertension. Dable joined Aerovate’s board in July and works part-time as a venture partner for RA Capital Management.

Julie Cherrington

→ In the burgeoning world of ADCs, Elevation Oncology is developing one of its own that targets Claudin 18.2. Its board is now up to eight members with the additions of Julie Cherrington and Mirati CMO Alan Sandler. Cherrington, a venture partner at Brandon Capital Partners, also chairs the boards at Actym Therapeutics and Tolremo Therapeutics. Sandler took the CMO job at Mirati in November 2022 and will stay in that position after Bristol Myers acquired the Krazati maker.

Patty Allen

Lonnie Moulder’s Zenas BioPharma has welcomed Patty Allen to the board of directors. Allen was a key figure in Vividion’s $2 billion sale to Bayer as the San Diego biotech’s CFO, and she’s a board member at Deciphera Pharmaceuticals, SwanBio Therapeutics and Anokion.

→ In January 2023, Y-mAbs Therapeutics cut 35% of its staff to focus on commercialization of Danyelza. This week, the company has reserved a seat on its board of directors for Nektar Therapeutics CMO Mary Tagliaferri. Tagliaferri also sits on the boards of Enzo Biochem and is a former board member of RayzeBio.

→ The ex-Biogen neurodegeneration leader at the center of Aduhelm’s controversial approval is now on the scientific advisory board at Asceneuron, a Swiss-based company focused on Alzheimer’s and Parkinson’s. Samantha Budd-Haeberlein tops the list of new SAB members, which also includes Henrik Zetterberg, Rik Ossenkoppele and Christopher van Dyck.

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Is the biotech market rally real? Data suggest comeback in private, public markets

After some halting starts, false dawns and fragile rallies, the biotech market may finally be back.
No, really.
In the last several months, several important…

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After some halting starts, false dawns and fragile rallies, the biotech market may finally be back.

No, really.

In the last several months, several important signals have added up to what feels like a rally, with more depth and certainty than some of the short-lived upticks during the doldrums of 2022 and 2023, when only the industry’s most optimistic souls were willing to call it a comeback.

But now, public biotechs are releasing positive data and raising money in follow-on offerings with ease. Biopharmas have already raised $13.7 billion in secondary raises in 2024, according to Stifel’s Tim Opler. Biotech’s benchmark index, the $XBI, is up 56% from last year’s lows and has broken the $100 mark, thanks to gains that go deep into the 120-company index. And in the private markets, crossover rounds are trickling back, and IPOs are showing signs of life.

Investors and executives told Endpoints News that this moment feels different, encouraged by a return to the basics, a focus on data, and signs of a healthier — if smaller — biotech ecosystem.

Chris Garabedian

“We should be beyond any of the lows,” said Chris Garabedian, a venture portfolio manager at Perceptive Advisors and founder of the firm’s early-stage investing unit Xontogeny. “We are going to see continued forward momentum.”

Investor sentiment is “very different from what it was in ‘22 to ‘23, where it was all doom and gloom,” MoonLake Immunotherapeutics CEO Jorge Santos da Silva said. A year ago, “The question was like, ‘What are the 22 ways in which you can die?’ That has really changed.”

The XBI cracking $100 is encouraging, but a deeper look at the index shows more signs of strength. The exchange-traded fund, which lets investors buy shares of its basket of 120 biotech companies, has seen $457 million in net inflows over the past month, according to YCharts data. And about 80% of biotechs on the index — which includes giants like Vertex $VRTX and small companies like Avidity Biosciences $RNA — have seen their stock in the green over the past three months.

Some of that gain is clearly driven by a surge in M&A, including the buyouts of Seagen, Horizon, Cerevel, and Karuna, all of which have returned billions of dollars back to investors who need to put it back to work in the private or public markets. And industry insiders have said there’s also a breadth in the disease areas drawing interest, including obesity, cancer, cardiology, neurology, and inflammation.

Even ARCH Venture Partners managing director Bob Nelsen voiced some broader — albeit measured — optimism for the market.

“For our internal base case, we’re still assuming that things are going to suck like they have in the last couple of years,” Nelsen told Endpoints. “But we all believe that it has turned.”

Nelsen still implores his portfolio companies and limited partners to “assume it’s going to be worse than you think.” But his optimism is driven by two major trends: the easing of macro factors like interest rates and the persistence of M&A. He’s closely watching whether generalist investors — whose huge dollars can swing a sector up or down, as they did dramatically during the pandemic — will come back to biotech.

“The conventional wisdom in Q4 is, they were never coming back in the market,” he said. “Turns out, in Q4 they were buying.”

From atonement to ‘FOMO’

Jorge Santos da Silva

Da Silva said the industry had been “paying for our sins” committed in the boom years of 2019 to 2021, when hundreds of biotechs went public — many far from going into the clinic. Along with layoffs and company closures, it resulted in an infestation of the corporate walking dead in companies trading at values below the amount of cash on their books.

But the number of those companies with negative equity value has dropped in the past few months, suggesting that a much-needed cleanup from the go-go years is well in progress.

“I call it a detox,” da Silva said. “Whatever we did was clearly excessive and everyone knew it at the time. But when you’re at a party, it’s like, ‘Oh my God, this is crazy, but let’s keep going.’ The detox phase is definitely coming to an end.”

Otello Stampacchia

Otello Stampacchia, the managing director of the Boston-based VC firm Omega Funds, said the mood is even “getting a little bit bubblicious” for biotechs with clinical-stage drug candidates in large markets with meaningful milestones in the next 12 to 18 months.

“There’s really a rush to get into those, particularly now that the indices have started flipping their dynamic,” said Stampacchia, who founded Omega two decades ago. “Up until early last fall, nobody wanted to catch the falling knife. It’s now the exact opposite dynamic, and there’s a bit of crowding in some of these names.”

“There’s real FOMO to invest in the right therapeutic products and the right therapeutic companies,” he added.

That’s carried through the private and public markets, Stampacchia said, noting that Omega participated in Alumis’ recent $259 million Series C raise — biotech’s biggest round this year. He said he was “incredibly surprised by the amount of demand there was for the deal.” All told, Omega has seen roughly half a dozen of its portfolio companies raise close to half a billion dollars over the last few months, with increased valuations.

“In each case, it really wasn’t difficult to syndicate,” he said. “There’s real demand.”

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Deflationary pressures in China – be careful what you wish for

Until recently, China’s decelerating inflation was welcomed by the West, as it led to lower imported prices and helped reduce inflationary pressures….

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Until recently, China’s decelerating inflation was welcomed by the West, as it led to lower imported prices and helped reduce inflationary pressures. However, China’s consumer prices fell for the third consecutive month in December 2023, delaying the expected rebound in economic activity following the lifting of COVID-19 controls. For calendar year 2023, CPI growth was negligible, whilst the producer price index declined by 3.0 per cent.

China’s inflation dynamics

China’s inflation dynamics

Chinese consumers are hindered by the weaker residential property market and high youth unemployment. Several property developers have defaulted, collectively wiping out nearly all the U.S.$155 billion worth of U.S. dollar denominated-bonds. 

Meanwhile, the Shanghai Composite Index is at half of its record high, recorded in late 2007. The share prices of major developers, including Evergrande Group, Country Garden Holdings, Sunac China and Shimao Group, have declined by an average of 98 per cent over recent years. Some economists are pointing to the Japanese experience of a debt-deflation cycle in the 1990s, with economic stagnation and elevated debt levels.

Australia has certainly enjoyed the “pull-up effect” from China, particularly with the iron-ore price jumping from around U.S.$20/tonne in 2000 to an average closer to U.S.$120/tonne over the 17 years from 2007. With strong volume increases, the value of Australia’s iron ore exports has jumped 20-fold to around A$12 billion per month, accounting for approximately 35 per cent of Australia’s exports. 

For context, China takes 85 per cent of Australia’s iron ore exports, whilst Australia accounts for 65 per cent of China’s iron ore imports. China’s steel industry depends on its own domestic iron ore mines for 20 per cent of its requirement, however, these are high-cost operations and need high iron ore prices to keep them in business. To reduce its dependence on Australia’s iron ore, China has increased its use of scrap metal and invested large sums of money in Africa, including the Simandou mine in Guinea, which is forecast to export 60 million tonnes of iron ore from 2028.

The Chinese housing market has historically been the source of 40 per cent of China’s steel usage. However, the recent high iron ore prices are attributable to the growth in China’s industrial and infrastructure activity, which has offset the weakness in residential construction.

Whilst this has continued to deliver supernormal profits for Australia’s major iron ore producers (and has greatly assisted the federal budget), watch out for any sustainable downturn in the iron ore price, particularly if the deflationary pressures in China continue into the medium term.

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