Tips and advice shared from an industry struggling to attract capital
While not everyone in the IR profession will be working in the environment that biotech IROs find themselves in today, everyone seemingly everywhere is battling the noise and uncertainty generated by tariff talks, geopolitical tensions and other macro headwinds.
IR Impact recently sat down with Angela Bitting, senior vice president, corporate affairs at Twist Bioscience, Aron Feingold, vice president IR and corporate communications at Geron Corporation and Lynn Pieper Lewis, founder and CEO of webinar sponsor Gilmartin Group, to talk about the challenges the sector is facing. The fascinating discussion that followed is as useful to those in the broader IR world as it is to those focused in on this niche sector.
You can watch a recording of the webinar here or read on for tips and advice we think speak to IROs everywhere.
Putting the situation into sobering perspective, Lewis offered some stark figures, explaining that ‘many healthcare-dedicated funds have limited cash to deploy right now. New ideas might be overlooked, given the uncertainty, as a lot of funds go to a portfolio level of risk management.
‘That is forcing them to sell a stock they might like to buy another one that they love.’
Amid the noise, it’s all about differentiation
‘When you’re a small company, you have to think a little bit differently,’ noted Bitting. ‘There are multiple companies trading for less than cash. You’ve got the geopolitical noise that is so loud right now and very overlapped with the investor community: I’ve never seen so many analyst notes focused on what’s happening in Washington.
‘With all that noise, looking at ways that we can differentiate our story, looking at ways we can differentiate our relationships with investors and really elevate our message becomes key.’
Go back to those value investors that ran you up before
Angela Bitting
Feingold echoed Bitting’s comments on the noisiness of the market. ‘Tariffs, of course, are something that we’re getting asked a lot about,’ she commented. ‘Healthcare supply chains are really, really complicated… So every question around that is about how that is going to affect modeling. Everyone in the industry is trying to figure that out.’
Take control – and get creative
The real question, continued Feingold, is ‘what can we actually do as IR leaders?’
For her, the answer is about doubling down on what can be controlled within the story and finding creative ways to get in front of investors. ‘Creative corporate communications tactics can really come in and [provide] support from an investor relations perspective. Are we using digital? Are we using LinkedIn to reach investors? It’s not just about sitting down across the table at a conference. Dynamic ways of engaging and having dialogue about dynamic topics is really important in this time.’
Lewis also talked about the need to be strategic in your engagement. ‘[Investors] need a reason to buy – so engage with the story that creates incentive,’ she advised. ‘Be clear about the impact of your next major milestone, even if it is a little way out. Educate them in advance.’
She also advised that increasingly, differentiation ‘really [comes back to the] importance of competitive intelligence’. In a stock-picking environment, IROs must stay on top of the trends in their space and among their peers, explained Lewis. ‘Let that inform your story going forward. Be prepared. Be ready to educate.’
Check back with former investors
Examining your register from a different period in the company’s growth can bring ideas to light for targeting today, said Bitting. ‘Our stock ran way up in 2021 and then came way back down in 2022,’ she explained. ‘If you are a company that investors liked in 2021 and you are now a value story, go back to those value investors that ran you up before. They likely still like you – so get back in front of them, make sure they’re familiar with the story, make sure that you are staying in touch with them.’
Lewis also pointed to ways IROs can get creative in their targeting: ‘Traditional equity raises might be out of the picture for right now, but [you can] think about other groups that you might not have prioritized in the past, whether that’s venture debt, royalty financing, smaller business development opportunities, smaller investors.’
Make it count
Whatever you’re doing and whoever you’re getting in front of, Lewis stressed the need to ‘make every significant update count,’ without getting promotional. Instead, IROs must tread the line between making the program work hard and remaining as transparent as possible. ‘Credibility wins the day over the long-term,’ said Lewis.
It’s not just about sitting down across the table at a conference
Aron Feingold
When it comes to speaking with executives and the board, Feingold talked about the importance of ‘acknowledging the place we are all in,’ something that is about really driving home the differences between the macro and what can be controlled. ‘It’s completely unproductive to be get into a conversation with your board or executive team about things that IR just can’t control,’ she said.
This is another area where competitive intelligence delivers a service: you can show executives what your peers are going through, you can look at what some companies are doing to talk about and combat these issues.
Beware survival mode
Continuing that train of thought, Feingold pointed to something she’s seen discussed on LinkedIn: that when things are challenging, executives err on the side of disappearing into the company. ‘It’s almost like you can see that survival instinct coming over them,’ she said. ‘But acting on a survival instinct communicates exactly what you think it would: that this person thinks they’re in survival mode – and that is the number-one way to instill not-confidence in your audiences.’ While she acknowledged the difficulties of being ‘vocal in an appropriate way,’ she stressed the need for companies to face their investors.
Traditional equity raises might be out of the picture for right now, but [you can] think about other groups that you might not have prioritized in the past
Lynn Pieper Lewis
Difficult times are when IR shines and the panel agreed there is a lot that IR can do, given the right tools and influence. Having that seat at the table is key and to gain that, ‘you need to make sure that you understand your business inside and out and can then be that resource for investors, can think about what they’re going through, and be that two-way communication street, both to investors and from investors to your executive team,’ advised Bitting.
The only way is up
Feingold posed an interesting question during the webinar, that seems a fitting and thought-provoking way to sign off: How do you use that low point as a potential inflection point and convince investors that there’s only upside from here?
Answers on a postcard.
