Gearing Up for JPM: Hope Springs Eternal

"People always hope for the best, even in the face of adversity." ~ An Essay on Man, Alexander Pope

We are on the eve of the JP Morgan Healthcare Conference, one of the world's largest and most influential healthcare conferences. Once again, we will return to San Francisco to network with investors, analysts, journalists, and other stakeholders and enjoy countless receptions hosted by the usual suspects of investment banks, law firms, and even communications agencies.

But why do we bother?

By my count, this will be at least my 20th such pilgrimage to The City by The Bay for "JPM." So, please forgive my introspection and perhaps a touch of cynicism as I ask myself why I continue to make this journey.

If we play our cards correctly, we come away with a clearer understanding of high-performing biopharma companies' future potential, innovative leaders' insights, and the sector's challenges. JPM remains a bellwether for the biotech industry, and the discussions and news made there can set the tone for the year ahead, especially in what will likely be a volatile year marked by uncertainty and drastic changes in the economy and geopolitics.

Companies use the event to showcase their pipeline and investments in new technology (basically, read that in 2025 as almost exclusively AI). The conference also provides a platform for companies to meet and discuss potential partnerships and collaborations, which can lead to new business opportunities and increased valuations.

In the long run, a biotech company's value is determined by its cash flow and underlying M&A potential. Given the lackluster M&A environment in 2024, the probability of an M&A event was low, and so was the relative value of many companies in the sector. However, many believe biotech M&A volume will increase substantially in 2025—beginning at JPM—due to relaxing financial regulations, falling interest rates, and a glut of undervalued mid- to late-stage therapeutics companies.

While JPM and the numerous satellite conferences and events are generally seen as positive catalysts for the biotech industry, we also can't ignore some negative aspects. The conference has long been criticized for lacking diversity in attendees and presenters, and these criticisms continue to hold truth. The week is a microcosm of an industry that, as a whole, continues to suffer from gender and racial inequity, limited perspectives, and reinforced biases. With any hope, we will see real movement towards a more inclusive biotech ecosystem this year.

A new year means new hope, right?