Biotech stocks have skyrocketed amid the pandemic. What awaits them now

Three years ago, few people knew about BioNTech. However, now it is known all over the world, and its annual revenue has reached $ 19 billion. Biotech owes its success primarily to a vaccine based on messenger RNA, developed jointly with the American Pfizer. However, even the availability of an effective vaccine could not protect the company from the fall in prices that other biotech companies faced. On August 8, BioNTech reported a 40% year-on-year decline in sales in the second quarter due to fewer unvaccinated or unvaccinated people. The value of the company's shares fell by almost 9%.

Biotechs are especially vulnerable to a combination of economic slowdowns, high inflation and rising interest rates. As in the case of other technology startups, the increase in the key rate reduces their investment attractiveness. However, biotechs, unlike, for example, software developers, require constant cash injections - the funds received go to finance the long and expensive process of creating new drugs.