Biotech Investing 101 – Investigating the Company Pipelines

Laidlaw & Company pic

Laidlaw & Company

A successful finance professional, James “Jim” Ahern serves as managing partner and head of capital markets with the New York-based firm Laidlaw & Company. At Laidlaw, James “Jimmy” Ahern focuses largely on the healthcare industry and makes investments in the fields of life sciences and biotech. When investing in a biotech firm, individuals need to look at a number of different issues, such as debt, area of research, funding, and management.

Individuals should also pay close attention to the product pipeline at the companies in which they are considering investing. Ideally, companies have more than one product in their pipelines. A company that has two or more products in or close to clinical trials has a greater chance of success. If one product fails, there is at least one more that could succeed. At the same time, startups with a large number of products at different development stages may be spreading themselves too thin and have difficulty bringing any of them to the market without greater focus.

Investors may also want to look for companies with products that are close to achieving FDA approval so that they will become commercially available in the foreseeable future. While FDA approval does not mean the product will prove commercially successful, it does increase the likelihood of seeing some sort of return on investment. Drugs that have reached the human test subject level have the most accurate data about safety and efficacy.