Chapter 13
Biotech IPOs
Biotech is a relatively new industry, dating back only to the mid-1970s. The underlying science involves the development of drugs using the DNA code. There might be, for example, a genetic defect that causes a certain disease; scientists will then endeavor to isolate the defect and to create a drug to cure the ailment.
The result can be huge gains for investors but it often takes a prolonged period of time. This was the case with Amgen Inc. George Rathmann started the company in 1980 by getting a round of venture capital of $8.5 million. A year later, he snagged $19.4 million more.
But it was still not enough. By 1982, the company was running out of money.
Rathmann believed that a better way to finance the company was ...
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