Hang Onto The Launch: Investor Outlook Is Brighter For Some Biotechs

Successful biotech launches like Regeneron’s Eylea, Vertex’s Incivek and others have investors reconsidering the “short the launch” mentality that pervaded the industry a year ago, though no one is throwing caution to the wind.

One year ago, after being burned by disappointing sales of drugs like Dendreon Corp.’s Provenge and Human Genome Sciences Inc.’s Benlysta, investors swore off biotechs in the midst of a commercial launch. The savvy strategy was to make money selling biotech stocks at the inflection point of drug approval rather than betting on a drug’s longer-term commercial potential, and “short the launch” became the mantra of the day.

But over the last 12 months, biotech has been cranking out new drugs, and a few have gotten off to...

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