During the depths of the biotech downturn, cash became king. It was by far the strongest acquisition currency, and considered the only asset worth paying for. Last year's battle for Oxford GlycoSciences between Cambridge Antibody Technology Group PLC and UCB Celltech was largely a contest for OGS's cash. It was eventually won in April 2003 by Celltech—which paid cash [See Deal]. (See "OGS: Going, Going, Gone," In Vivo Europe Rx, May 2003 Also see "OGS: Going, Going, Gone" - In Vivo, 1 May, 2003..) Many firms, including OGS, were valued at lower than cash, regardless of the stage or nature of their technologies or drug candidates.
The picture's different today. Thanks to strengthening biotech indices, many of those firms with low cash-as-percentage-of-market value figures are those that have enjoyed overwhelming market support. (See Exhibit 1.) Shares...