Investment thesis:
Biotechnology investors work on the assumption that news surrounding assets in clinical development impact company valuation significantly. Our analysis suggests that focusing on earlier events, such as Phase 2 and 3 data release, represents a stronger short-term, catalyst-based investment strategy in the biotechnology sector, relative to PDUFA events. The shift in focus away from PDUFA events is driven by two factors. First, recent PDUFA events have had small impacts on stock valuations, likely due to closer guidance by the FDA; second, biotech-focused investors have become more sophisticated at predicting PDUFA outcomes by incorporating