A central objective of an effective investor relations function is to communicate a compelling investment thesis, and thereby positively impact the company’s market value. Biotechs have multiple communication options to reach investors (e.g., press releases, conference calls, individual investor meetings); however, attending and presenting at healthcare-focused investor conferences has many unique advantages.
First and foremost is efficiency. Conferences provide an opportunity to meet with a large number of potential biotech investors in a single day. These are typically qualified investors with a deep understanding of the industry and the background to understand the nuances of your company’s scientific approach. Second, conference participation can act as a catalyst to reach larger audiences. Most meetings offer the option to webcast, and thereby widely distribute company presentations. Publicly available recordings and transcripts provide additional investors the opportunity to review your company’s scientific approach and investment thesis. In addition, presentations can be made compliant with ‘Fair Disclosure’ regulations, enabling disclosure of material non-public information.
Once a company decides to join the conference circuit, there is the question of which of the 40+ healthcare banking conferences to attend. The majority of these conferences are held in New York and Boston, however, others are hosted in other cities across the country, and these can provide the opportunity to reach new investors located outside the Northeast. Conferences range from broad healthcare events hosted by large ‘bulge bracket’ banks (e.g., J.P. Morgan healthcare conference) to smaller, more targeted events focused on specific therapeutic modalities (e.g., Chardan genetic medicine conference). The size and prominence of any given conference is determined by the reputation and influence of the bank’s healthcare investment bankers as well as the equity research analyst team. Conference quality can meaningfully change year-to-year as key analysts and bankers transition among institutions.
Investor meeting schedules at conferences can be grueling, with some scheduling 20 minute back-to-back meetings with investors throughout the day. Answering the same question over and over, while staying fresh and energetic, can be difficult. It is often advisable to consolidate certain investors together for a group meeting. However, there is a balance here as well, and questions from too large of a group can become challenging to handle. Also, it is best to take an active role in managing the investor meeting schedule, ensuring sufficient time and attention is provided to the most important target investors.
Biotech companies take differing approaches to conference attendance with some companies being ‘regulars’, while others attend more sparingly. To obtain an indication of the ‘typical’ broker biotech conference attendance, we looked at publicly disclosed conference participation by a group publicly traded (i.e. public > 1 year), U.S. based development stage biotechs. For this analysis, we looked at the conference participation of 20 companies* with market caps ranging from ~$600M to $10 billion. We examined the activity during the 12 months prior to Sept. 2018.
Summary of conference activity:
All biotechs examined (n=20) actively participated in investor conferences. The median annual number of conferences attended was 10.5, or about 2-3 per quarter (Range of 5 -17 conferences per year; 25% percentile = 7.75 per year; 75% percentile = 12 per year)
The most widely attended healthcare conferences were Bank of America, Barclays, Cowen, Evercore ISI, Jefferies, JP Morgan, Leerink, and Morgan Stanley. However, the total number of different investor conferences attended was large (n=37).
Our general recommendation is that companies take advantage of available, high quality conferences to meet with investors on a regular basis throughout the year, and across the country. However, companies should take a thoughtful approach to develop a customized IR plan that considers multiple factors including business goals, communication objectives as well as upcoming company milestones. For additional guidance on developing an investor outreach plan, or for any other IR support, please reach out to us at firstname.lastname@example.org.
* Companies analyzed: Abeona, Aimmune, Alkermes, Alnylam, Amicus, Arena, Audentes, bluebird, Crisper, Dicerna, Editas, Intellia, Ionis, Sangamo, Sarepta, Spark, Regenxbio, Ultragenyx, Voyager, Wave