Wong: Biotechs launching sub-billion-dollar drugs face severe commercial funding challenges
Rod Wong · Rod Wong – Empty Rooms: Innovation in Biotech at RTW (Capital Allocators, EP. 310) · Apr 24, 2023 · at 45:29
Rod Wong, founder of RTW Investments, details why commercial-stage biotech companies with mid-sized drug launches struggle in risk-averse market environments.
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“One particular example that we find kind of interesting is that companies that actually have succeeded all the way, you know, through development, and they're getting ready to launch a product, but that product is a sub one billion dollar peak sales product. Could be pretty big, like half a billion. And in, you know, before the bear market, that would be a very exciting investment. But the problem with a half a billion dollar peak sales drug, and even worse, if it's not in a strategically important area, that company is, has got a terrible situation because you have to raise two to three hundred million dollars for the next 24 months to launch that drug. And in this market environment, people are so risk averse that they don't want to take that risk. And it's hard to find 200 to three hundred million dollars. So those are losers in the environment.”
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