Oz biotechs beat the bulls

Local biotech performers have overtaken the traditional basket of stocks by 13 per cent, showing a 27 per cent leap in prices, according to a report from stockbroking firm Intersuisse.

"There has been a renewal of confidence in selected biotechnology stocks over the past three months . . . . (suggesting) the sector is now recouping recent losses. Interestingly, it has been the smaller companies which have driven this resurgence,” said Intersuisse director Jonathan Buckley.

The Intersuissse Biotechnology Index, which tracks the share price performance of 60 listed Australian biotechnology companies, has risen from 4,494 points mid- March to 5,686 points at mid-June - a rise of 1,192 points, or 27 per cent. Conventional stocks have only risen 14 per cent over the same period.

According to the report, the best performers have been Chemeq (169 per cent), Clover Corporation (127 per cent), Benitec (121 per cent), Genetic Technologies (111 per cent) and EpiTan (107 per cent). Also driving this resurgence is renewed confidence in the US, with the NASDAQ surging by 57 per cent over the same period, said the report.

Buckley added that last week's tri-state announcement of a VIC/NSW/QLD state biotechnology alliance was additionally welcome, noting that this was a signal of the renewed interest in the biotech sector worldwide.

“The challenge for Australian companies is to establish an international scientific and capital markets presence. This is likely to be associated with a higher level of global corporate activity in the sector,” he added.