Over the last 12 months there have been 15 listings of biotech and medical device companies on the ASX. In this year alone, four biotech companies have listed and there are now two clear trends emerging. New biotech stocks are offering investors better value for money and microcap stocks (with a capitalisation less than $10 million) are performing outstandingly well.In 2000/2001, at the height of the genomics boom, there was a flood of biotech stocks that came onto the market at valuations that were certainly more in favour of the listing company. The table below lists eight early stage drug discovery companies that came onto the market over this period. The pre-money valuations of these companies varied from the top end at $53 million for Starpharma, $48 million for Pi2 and $43 million for Analytica, to $10 million for Epitan, $14 million for Peplin Biotech and $17 million for Prana Biotechnology at the bottom end. Of interest is that the top five companies are now trading at a discount to their listing price (Pi2 is no longer trading) and the bottom three companies are all trading at a premium.
