I worry that the basic science pipeline is drying up in biotech. A lot of good people are leaving the field due to erratic funding situations and generally low income and poor career outlook. I left my PhD in biology and many of my fellow PhDs, even if they graduated, are looking outside of the field for jobs.

RNAi is an example of something that was discovered 'by accident' from basic and exploratory research. To add, a lot of novel discoveries can be made from studying natural habitats and organisms(PCR for example) and many of those are disappearing. Making bets on biotech is making a bet on a field where long term prospects look poor.

Indeed, and a vast majority of early stage biotech's will simply contribute nothing. But then you get a story like Pharmasset which made any semi-early investor realize unbelievable gains in a very short period. But these stories are rare and it's pure speculation and the playing of market dynamics.

But yes, it is expensive research and although these companies have been able to find funding in the public markets due to a healthy appetite of risk for these types of things, I fear that when this obvious bubble bursts it will be very hard to find funding and a lot of research will simply run out of runway.

RNAi had a hot streak years ago and then had "dark ages" for quote a few years before it suddenly got hot again. And really the entire sector has been on fire. But I expect reality to take over soon and biotech will have some dark days ahead of it.

But for now, the casino chugs along.