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WeWork IPO woes are bleeding into the biotech market, bankers say - Business Insider

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Biotech IPOs are up against a growing aversion to risk after the WeWork debacle

Rahul Chaudhary, the head of equity capital markets at SVB Leerink, told Business Insider that going into September, the biotech IPO market was strong.

Even before ADC decided to pull its IPO, a top healthcare banker told Business Insider that he's advising clients to halt any listing plans this year. WeWork's disastrous IPO played a part, he said. Like tech, the biotech industry is also flooded with promising but yet unprofitable companies. Health firms often require millions of dollars in funding and sometimes a decade or more of studies to develop blockbuster drugs.

A recent Bank of America report from said that unprofitable IPOs have mushroomed to "tech bubble levels.""Recent IPO withdrawals could be a warning sign that investors are shifting focus to profitability, amid macro concerns," Bank of America said in the note to clients on Monday.The London M&A banker said that while WeWork's pulled IPO last month acted as a barometer for plunging risk appetite, other factors have played a big part as well.

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