It appears that the next big thing on TASE (TEl Aviv Stock EXchange) will be the life sciences sector. There are about 10 research startups on the bourse and they have shown very good performance in the econd half of 2009. Yesterday COMPUGEN shares jumped 75% as some kind of research agreement was signed with Pfizer. This is a firm, like all of them, that has not sold a pill and lives from refinancing to refinancing. Compugen CEO Tzatzkes Axselbrad said that a short-term financial target for the firm is to achieve cash flow breakeven by the end of 2011, based largely on research revenues under milestone and revenue sharing collaboration agreements.
I was there at the birth of this industry but it did me no good. Fifteen years ago I was invited to the inauguration of the Maus Computer Laboratory at Tel Aviv University. Senor Marcos Maus was then an 80 plus years old Holocaust survivor who had made money in Mexico and supported the lab. I tried to understand on what was Maus's money spent and what they were supposed to be doing there, and one guy explained me that they were modelling how large molecules organize themselves - on the computer. The whole place didnt look anything like a laboratory or anything I was used to, it was a lightless bunker with a couple of computers and a coffee corner. Those were the days of DOS and there were funny outprints stuck to the walls. I asked one of the students lazying around what they were looking for? and he said new drugs.
I was very skeptical. I suspected that Maus had been sold a fake project (I suspected that the "Chair of Jasy Jewry Studies" and so were all fake). Yet Maus, the caricature of a miniature (1.40 m maybe) carrot-head Polish Jew (he died soon after), was happy there taking pictures with his grandchildren. He insisted on speaking Yiddish to his family and everybody. I could not have imagined that underground bunker where a few students spent time playing PacMan as the seed of Compugen and a whole industry on TASE. It seems that Maus was much smarter than me and could see the future better. I am afraid of these luftgescheften, yet big money is being made by them.
Think J, think. You do awake twenty years late, but there is so much money on the life sciences table that you may yet pocket some. For your grandchildren.
5 comments:
Hi Ronduck, you suspicions are baseless. The future is exciting, I cant wait being there. Year 2010 will be the best.
I wouldn't invest in biotech companies quite a few seem to be going nowhere. Most hope to net a cash windfall by being acquired by big pharma. This is hardly an incentive to develop a product from scratch to ultimately bring it to the marketplace. Increased regulation will bring more problems. In general, however, the life science sector, should expand. You should invest in biotech index-linked funds instead.
I would say not most but ALL biopharm startups in Israel are hoping for the big exit, tht is, being bought by a big pharma company. That is the idea and it is working. Big pharma is dry, cannot think of anything, so they promising projects. My worry is how to separate the bona fide projects from the fake ones, those organized with the exclusive purpose of creating an illusion to trap desperate pharma executives. To me, most seem fake. But I am known to have been wrong before.
I agree, 2010 will the best year ever.
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