[akiselev]

This analysis needs to exclude biotech companies like Moderna, otherwise it conflates high market risk companies that are burning money trying to become profitable with companies that are high on R&D risk and are practically forbidden from making money (from the general public) but are guaranteed an exit if the science works out (and will quickly fall to zero if it doesn't).

Given the 5-10 year time frame for devices and 10-20 years for drugs and complex therapeutics, most successful biotech companies IPO after phase 1/2 trials when they have zero revenue (it's illegal for them to charge consumers for anything related to the product until it's approved). Pharmaceutical companies have the benefit of knowing "product-market fit" ahead of time so a successful phase 3 is all but guaranteed a multi-billion dollar acquisition (it even happens at phase 2 for promising candidates). This has been going on for decades with increasing frequency thanks to the pharma industry falling off the small molecule cliff and analyzing these companies in the same group as VC subsidized rideshare or whatever isn't going to yield the best results.