Biotech Stock Performance Around Critical Events


In her 2001 book “From Alchemy to IPO” Cynthia Robbins Roth cites a Hambrecht & Quist study of biotech stock movement surrounding clinical trial results (Phases I-III) and FDA approvals. The study examined the 12 months prior to and following the “event”.

Is anyone aware of such a study performed elsewhere that is more recent and/or comprehensive (I remember the number of observations being quite small)?

I am confident there is an academic, i-bank, consultancy, or buy-side shop that has done this work somewhere. . .and I don’t want to reinvent the wheel if at all possible.

Any biotech hedge funds out there that would be worth contacting?

I have not waded through these papers below, but so far the results I have found include:

Xu (2006), “R&D Progress, stock price volatility, and post-announcement drift: An empirical investigation into biotech firms”

Sharma (2004), “Linking Product Development Outcomes to Market Valuation of the Firm: The Case of the U.S. Pharmaceutical Industry”

Zhang (2006), “Security Market Reaction to FDA Fast Track Designation”

Cohen (2004), “The Fast Track”