Our Biotech Portfolio
Stocks |
Date of Initial Coverage
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Initial Entry Price
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Highest Point |
Performance from Initial Entry
![]() |
---|---|---|---|---|
EMD | 1693749600 04-Sep-2023 | $0.075 | 65% | -13% |
ALA | 1645102800 18-Feb-2022 | $0.038 | 189% | 132% |
DXB | 1629036000 16-Aug-2021 | $0.200 | 45% | -33% |
BOD | 1615899600 17-Mar-2021 | $0.500 | -50% | -95% |
Stocks |
Date of Initial Coverage
![]() |
Initial Entry Price
![]() |
Highest Point |
Performance from Initial Entry
![]() |
---|---|---|---|---|
EMD | 1693749600 04-Sep-2023 | $0.075 | 65% | -13% |
ALA | 1645102800 18-Feb-2022 | $0.038 | 189% | 132% |
DXB | 1629036000 16-Aug-2021 | $0.200 | 45% | -33% |
BOD | 1615899600 17-Mar-2021 | $0.500 | -50% | -95% |
How to invest in biotech
Macro Outlook Biotech - 2023
Last year was a difficult year for the biotech industry, with the cost of capital rising with interest rates, small cap biotech companies found it difficult to raise capital at attractive rates.
Investing in biotech is for the patient investor, and we think that 2023 provides an opportunity to enter biotech investments at attractive valuations… and then wait.
We like investing in biotech companies because of the high-risk high-return potential if a technology is successfully developed through clinical trials.
We also like that drugs developed in a clinical setting have meaningful impacts on people’s lives and the generous R&D tax incentives from governments provide a much needed cash buffer for small cap biotech companies.
Last year, the Biden administration announced the “Cancer Moonshot'' project, to provide funding for drug development in the area - and recent policy changes have supported drug development in both the renal space and for Alzheimer's disease.
Drugs that we think are set for a strong decade are:
- Cell therapies for cancer treatment
- Renal drugs for kidney disease
- Treatments for rare diseases that can secure orphan drug status
- Alzheimer's treatments
- Weight loss / diet drugs
We think that VC biotech funds sat on the sidelines in 2022 and there is a surplus of cash to be deployed in the market.
At the JP Morgan biotech conference the outlook for the biotech industry was optimistic for 2023, with a likely return to M&A activities for big pharma.
Whether this trickles down to small cap biotechs, only time will tell, but we think this is going to be a slow year for small cap biotechs (at least in the first half of 2022) - and an opportunity for patient investors to go bargain hunting in the sector.
Click here to see our Biotech investments.
What do the analysts say?
According to McKinsey & Co. the outlook for biotechs in 2023 is a return to focus on fewer, high priority programs.
McKinsey believes that successful biotechs will ensure a clear connection between capital allocation and value creation in R&D and in broader company operations.
In simple terms, biotechs will be more focused on few drugs and preserving capital.
This might see a return to M&A activity in the space and a good acquisition opportunity for cashed up biotechs.
Read the full McKinsey report.
PWC has also flagged M&A activity as a big outcome for biotechs in 2023, as the overall economic outlook stabilises, the need to invest in pipeline opportunities and technology grows.
Oncology and immunology leads the conversation in the world of Big Pharma, but other areas such as the central nervous system and cardiovascular diseases are expected to gain interest.
Talu Ventures life sciences managing director Andy Jane said:
“There was about $US40bn worth of new US biotech VC fund money raised in the last 18 months so there is plenty of dry powder for new companies, and follow-on funding for those companies which VCs have a conviction about.
Public equity markets are still essentially closed although there were occasional green shoots at the back end of last year. People are taking bets on whether 2023 is going to be a bull or bear year. I would say the consensus is 60/40 a bear year.
What is the bear case?
The key risks for any early stage biotech is funding.
The outlook for 2023 is that small cap stocks are going to find it difficult to raise capital at attractive valuations.
This means that investors will want to see cashed-up biotech companies focus research and development on one or two key assets, so as to preserve capital for when the appetite for high-risk investments returns.
Some biotech companies are trading at cash backing, and with valuations crunched, it could be an opportunity for investors to pick up some ‘bottom of the market’ deals in the sector.
Our Biotech Investments

Emyria (ASX:EMD)
Read Investment Memo →

Arovella Therapeutics (ASX:ALA)
Read Investment Memo →

Dimerix (ASX:DXB)
Read Investment Memo →

Bod Science (ASX:BOD)
Read Investment Memo →
Our Commentary on Biotech
The Macro Themes Driving the Small Cap Market Right Now
Weekender
Oct 24, 2023
|Next Investors
|14 min
In this weekender we look at the macro themes driving the small cap market right now. Biotechs, oil & gas, uranium and graphite are all vying for investor attention in a bear market.
Investing in Early-Stage Biotechs and the Drill Race is on...
Weekender
Sep 9, 2023
|Next Investors
|11 min
In this Weekender, we look at the high-risk, high-reward landscape of biotech investing, early-stage companies offer outsized returns on successful clinical trials, aligning perfectly with our investment strategy and providing a unique opportunity to contribute to groundbreaking advancements in medical science.
Why are small caps going down and new lithium commentary
Weekender
May 20, 2023
|Next Investors
|15 min
In this weekender, we cover the old market saying - "sell in May and go away" - while also giving our spill on the lithium market right now.
The Macro Themes Driving the Small Cap Market Right Now
Next Investors
|Oct 24, 2023
Investing in Early-Stage Biotechs and the Drill Race is on...
Next Investors
|Sep 9, 2023
Why are small caps going down and new lithium commentary
Next Investors
|May 20, 2023