Biotech bottoms out, but a bounce back is no guarantee

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Biotech bottoms out, but a bounce back is no guarantee
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Biotech investors believe the market has bottomed out, but any upwards swings are likely to be stock-specific rather than a broad-based boom.

investors believe the market has bottomed out, but any upwards swings are likely to be stock-specific rather than a broad-based boom, which characterised 2020 and 2021.

SG Hiscock’s Rory Hunter says the biotech market will improve in 2023, but will remain challenging for pre-revenue companies.“Right now, you’re seeing so little retail participation in the market and for speculative stocks to outperform, you need retail participation in earnest,” he said.

Companies such as Lumos Diagnostics, Kazia Therapeutics, Hexima and Exopharm were among the worst performing small caps on the whole ASX, and had almost all their value wiped out, with share price declines of 85 per cent-plus. Companies that fall into this bracket, he said, include the likes of healthcare technology players Alcidion and Mach7 Technologies, as well as Telix Pharmaceuticals and medical marijuana player Cronos.

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