Can you discuss the Nasdaq Biotechnology Index and how the last months looked like for this stock market?

Nasdaq is the leading exchange for all healthcare listings, and we have a 98% market share of IPOs in the biopharma space. Our support for biotech and healthcare is unique as we provide best-in-class services and tools, data, and the most efficient trading platform for companies in these sectors to reach investors.

The Nasdaq Biotechnology Index (NBI) is the gold standard and it elevates a company’s profile from a global visibility standpoint. By listing on the Nasdaq, companies are reaching the largest set of sophisticated healthcare investors in the world. The leading research and expertise of the US healthcare scientific community, deep pools of liquidity from educated investors, and the branding opportunity of being listed on the world's most innovative healthcare exchange for disruptive growth companies are extremely attractive and valuable for companies looking to go public. How have life sciences companies performed on Nasdaq in 2023?

Judging a life sciences company on a one-year performance is a tough lens as it can skew either up or down depending on macroeconomic factors. A short-term investment in healthcare has a five-year horizon, whereas a long-term investment is 10 years. For many companies, it is a binary outcome with drug approval, and you cannot judge performance until they reach their clinical milestones. The most interesting key performance indicators (KPIs) when measuring a newly listed company are - how is the milestone data being interpreted, and how is the efficacy and safety of the clinical trial performing?

Over the past 10 years, the biopharma sector has performed well, and we have seen many companies tap into the markets. There were six notable IPOs on the Nasdaq in January. Has the IPO window fully opened?

We are in a new chapter for biotech, and the window for IPO is open. We are seeing a new class of biotech IPOs, which are companies that have achieved later-stage data milestones. This means there is some degree of visibility into what the future holds for the data readouts and there is a lower chance of failure. Investors are heavily interested in these kinds of companies versus the pre-clinical brands we have seen in the market in prior years. The companies that are now listing also have shorter-term inflection points from IPO. Companies are going public with later-stage data and a shorter time to when the market will see the data flip for the next readout, and this makes for an interesting and attractive opportunity for investors, which is driving this new class of IPOs. The backdrop of greater macroeconomic clarity and potentially positive news coming out of the Fed later in the year will lead to increased levels of IPO activity in 2024 compared to 2023, and over the past six months, we have seen a significant increase in applications versus the last two years. What should investors consider before entering the life sciences space?

Company data and the therapeutic stage are the most important factors for investors. Big companies with good data and experienced management teams will always be able to IPO. Looking back on historic periods of market volatility, you still saw biotech IPOs get out. That is because they are taking a longer-term view of the markets and are not beholden to a one-year Fed fund target rate but rather looking at whether the drug will advance in the clinic, whether there is a path to approval, and where healthcare investors are willing to tie up money for a longer term because they believe in the science and the ability to get this drug to market. What are Nasdaq’s key priorities in 2024?

Nasdaq is laser-focused on innovating and providing the most robust set of tools, data, and services for life sciences companies to target investors and ensure that as a public company, they are maximizing the value for their shareholders. We have seen an immense amount of interest in going public over the last few months, and we are extremely excited about the road forward in 2024.