US Biotech closed 2009 on an upswing, despite negative start, says Burrill

The biotechnology industry closed its books on 2009, a year where the sector's stock values dipped dramatically during a turbulent opening quarter, then to be followed by a slow, steady recovery.

The "V-shaped" stock chart performance of biotech in 2009 mirrored to a large extent what happened in the general capital markets. From their lows in March, the markets, as measured by major indices such as the Dow and S&P 500, gained about 50%. In the final analysis, the Dow closed the year up 19% and the Nasdaq did even better, up approximately 45% and the S&P 500 index closed 24% higher, its strongest performance since 2003. The Burrill Biotech Select Index, a price-weighted index tracking 20 of biotech's "blue chip" companies, closed the year up 4% in value.

"We have to thank a strong closing month for the Burrill Biotech Select Index, posting a strong 5% gain, as the reason for it finishing in the black at year end," said Steven Burrill, chief executive of Burrill & Company, a San Francisco-based life sciences firm with activities in venture capital, private equity, merchant banking and media. "The Index's fourth quarter performance, by contrast, was lackluster as a consequence of residual investor nervousness about the relative strength of the economic recovery, fears over health care reform and continuing concerns about a mounting backlog of drug approvals at the Food and Drug Administration,' he noted.