US Biotech begins year on a quiet, but optimistic note, says Burrill

The biotechnology industry in the USA opened the New Year quietly with the Burrill Biotech Select Index up marginally for January at 0.3%. Meanwhile, the capital markets recorded their strongest January in years. The Dow Jones Industrial average closed the month with a 2.7% gain and the Nasdaq Composite index closed up 1.8%.

"Although not yet reflected in biotech's performance on the capital markets, the mood at the annual JP Morgan Healthcare Conference in San Francisco early January was upbeat reflecting the fact that many biotech and pharma CEOs believe that 2011 will be a good one for them," said Steven Burrill, chief executive of Burrill & Co, a diversified global financial services firm focused on the life sciences industry.

"I believe we will see an increase in M&A activity in biotech land as companies position themselves for growth this year. It was clear that pharma executives were checking out promising companies to bolster their product pipelines...and several large biotechs, sitting on plenty of cash, made their intentions known that they are looking to acquire assets. Amgen, for example, pulled the trigger on a $1 billion deal late January to acquire BioVex [The pharma Letter January 25], the creator of a late-stage cancer vaccine that has shown encouraging results in treating solid tumors," noted Mr Burrill.