Public Biotech: The Next Credit Crisis Victims
It is, admittedly, a bit of a stretch to connect the following finding in a new NBER paper to the recent credit crisis, but it's plausible that the sector's sensitivity to cost of capital is being overlooked:
1In the current study we find that biotechnology firms are exposed to greater financial risk than other industries ... Average nominal costs of capital over the 1982-2005 time period were 16.25 percent for biotechnology firms.
