Federal Reserve, M&A and Politics: What's Ahead for the Biopharma Sector in 2024? ️

As we close out the year,

happy that biotech/biopharma has become a hot sector again 🔥 😃

• After a tough 3 years

Hopefully, this momentum will continue thru 2024 🙏 🎇

The fate $XBI and smid-cap biopharma is probably most impacted by:

1) The Federal Reserve pulling back rates in 2024

• As they have signaled & the market currently appears to expect

2) Continued active M&A

• As  expected if we continue to have large caps in need of new therapeutics

⇨ approved/nearing approval with good revenue/potential &

⇨ good patent protection and life

⇨ ⇨ IMO XBI at ~$70-$120 (esp. $80-$110) is a good range for smid-cap acquisitions

Also noteworthy tailwinds:

•  High profile clinical breakthroughs and approvals

⇨ Continued success in metabolism/weight loss

⇨ ⇨ GLP-1 drug successes have likely helped the entire sector

Headwinds:

1a) Congress continued focus on drug price regulation/control

1b) FTC's continued M&A scrutiny,

1c) How the election develops with respect to a pro or anti-pharma Congress and president:

• IMO & intended as a factual & NOT a political statement: The present Congress and president have been tough on biopharma.

⇨ Continued focus on drug price reform

⇨ Aggressive FTC scrutiny of biopharma deals

Article history:

Posted 12/29/23