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The year of biotech’s recovery

ARTICLE | Finance

Public Markets Preview: Investors say biotech outperformance in 2024 will hinge on the interest rate environment

By Stephen Hansen, Director of Biopharma Intelligence

January 12, 2024 9:12 PM UTC

A two-and-a-half year bear market for biotech may finally be coming to an end, as the consensus expectation among investors is that the sector will outperform the broader markets in 2024. But doing so will require the Federal Reserve to follow through on its signal of a return to a falling interest rate environment.

The end of the down market for public biotechs has been predicted before, but this time the signs of recovery may be more than just green shoots. Positive share price reactions to clinical data, upsized opportunistic follow-ons, a run of strong M&A transactions, and a 40% run-up in the XBI over the final two months of 2023 are just a few of the markers demonstrating increased investor interest in the sector…