'Biotech Super Bowl' Lands With a Thud. Stocks Slide on Lack of Deal News. -- Barrons.com

By Josh Nathan-Kazis

The first morning of the biggest healthcare conference of the year seems to have come and gone without any major deal announcements.

That isn't a great sign for the biotech sector. Last year's extraordinary recovery for the stocks began to wobble last week as concern mounted that an anticipated wave of acquisitions may be slow to materialize.

Monday is the first day of J.P. Morgan's annual healthcare investor conference, which draws thousands of investors, analysts, and executives to San Francisco each year. The gathering swamps the city and sets the agenda for the healthcare sector for the year to come.

Investors watch each year for big deal announcements on the conference's first morning. There is ample precedent: Last year, Johnson & Johnson announced a $14.6 billion deal to acquire Intra-Cellular Therapeutics on the first day of the gathering.

While expectations were high, there was no such deal on Monday. The Wall Street Journal reported last week that Merck was in talks to buy the biotech Revolution Medicines for roughly $30 billion, but as of late morning, no such agreement had been announced.

The State Street SPDR S&P Biotech ETF, which trades under the ticker XBI, was down 2.1% on Monday morning, a sign of a shift in what had been an optimistic mood across the sector.

The XBI rose more than 45% in the last six months of 2025, a historic run-up for biotech. The basic thesis behind the gain is that cash-rich pharma companies facing a loss of revenue as patents expire will need to do deals.

In the first trading days of this year, however, that run-up has seemed to wobble. Some analysts cited a lack of M&A as biotech stocks sold off early last week.

The XBI rebounded as last week progressed, but it was falling again on Monday.

The conference isn't over, and a deal could still come. But some of the rhetoric early Monday seemed to look past the stocks' recent stock surge, to renewed threats ahead. In an annual letter published Monday, Noubar Afeyan, the CEO of the biotech-focused venture-capital firm Flagship Pioneering, said that the U.S. had backed "down from its support for science," and was showing "growing contempt for the scientific method," even as China has increased its focus on biotech.

"If we lose our ability to collectively resolve our skepticism through the scientific method, we won't just slow the miracle machine, we'll throw it into reverse," Afeyan wrote. "We won't just stop making new discoveries -- we'll undo past ones."

Virtually all of the biggest healthcare companies will host presentations at the Westin St. Francis in downtown San Francisco over the coming days. CEOs of Pfizer, Johnson & Johnson, Bristol Myers Squibb, and Merck will all speak on Monday, followed Tuesday by Novo Nordisk and Eli Lilly, among dozens of others.

More important will be the countless meetings, panels, and parties, which sprawl across the city over the course of the week. While all subsectors of the healthcare industry are represented, it is pharma and biotech that generally hold the spotlight. People call the meeting the Super Bowl of biotech.

As investors awaited deal news, other companies rolled out quieter updates. Here are a few highlights and how stocks are responding.

   -- Moderna shares were down 1.4% after the company preannounced its 
      fourth-quarter 2025 results, saying it expects to report revenue of $1.9 
      billion for 2025, roughly in line with the FactSet consensus estimate. It 
      reiterated its prior financial guidance for 2026, and said it continues 
      to expect to stop losing money in 2028. "We think more reductions are 
      needed to instill investor confidence in [management's] 2028 cash 
      breakeven guidance," Jefferies analyst Andrew Tsai wrote early Monday. 
 
   -- Shares of Alnylam Pharmaceuticals were down 9% on preannounced 
      fourth-quarter results and 2026 guidance. The company said it expects to 
      report fourth-quarter net product revenue of its top-selling drug, 
      Amvuttra, were $827 million, short of the $842 million FactSet consensus 
      estimate. It said to expect net product revenue of between $4.9 billion 
      and $5.3 billion, well above the FactSet consensus estimate of $3.7 
      billion. Anlylam also laid out a new multiyear strategy. Investors appear 
      to have been hung up on the fourth-quarter revenue miss, however. 
 
   -- Twist Bioscience shares were up 8.6% after the company reported initial 
      results for the first quarter of its 2026 fiscal year that were slightly 
      ahead of estimates. Analysts had worried about the company's ability to 
      meet its revenue guidance. "This was a strong result for Twist and 
      certainly qualifies as 'better than feared,'" William Blair analyst Matt 
      Larew wrote. 

Write to Josh Nathan-Kazis at josh.nathan-kazis@barrons.com

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January 12, 2026 11:38 ET (16:38 GMT)

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