Weekend Musing: Money Talks

Research evidence excerpt

Weekend Musing: Money Talks

Biotechnology

EQUITY RESEARCH Industry Report

June 18, 2026

Research Analysts:

Josh Schimmer

310-282-6513 Biotech has, historically, been a sector of 'hopes and dreams' ‒ substantial

Josh.Schimmer@cantor.com investments in R&D with fingers crossed that a company would meet with

Eric Schmidt clinical, regulatory and eventual commercial success ‒ or be acquired along

212-294-7724 the way. Eric.Schmidt@cantor.com

Prakhar Agrawal

212-610-3614 ●Very, very few were able to replicate that success twice to get multiple

Prakhar.Agrawal@cantor.com drugs approved in the hopes of transforming into a sustainable

Olivia Brayer Saunders company.

212-428-5907

Olivia.Brayer@cantor.com

So the sector, at least until recently, struggled under that model ‒ with Carter Gould

212-915-1794 limited tools for reliable innovation, drug pricing frameworks that made

Carter.Gould@cantor.com it hard to achieve meaningful profitability for those lucky enough to get a

Kristen Kluska drug approved, and the invariable patent cliffs that required significant R&D

212-915-1927 investments for there to be any shot at sustainability. Kristen.Kluska@cantor.com

Imogen Mansfield

929-545-6495 ●M&A became one of the few ways to extract $$ from the sector ‒ and

Imogen.Mansfield@cantor.com hence was the 'lifeblood' of the industry.

Steve Seedhouse

212-915-1240 As a result of this dysfunctional business model, generalists disappeared. Steve.Seedhouse@cantor.com Biotech became a pit of negative earnings, endless dilution and Yanni Souroutzidis

929-730-2656 unpredictable binary events. Companies could make hundreds of millions

Yanni.Souroutzidis@cantor.com (or billions) a year in revenue without ever appearing interested in actually

Pete Stavropoulos, Ph.D. making money.

212-915-1966