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Small-Cap Biotech Stocks Play Catch Up With Industry Leaders

  • Companies making coronavirus shots and treatments outperform
  • ‘Question of when’ for small caps, ‘not if,’ says one analyst
biotech health lab
Photographer: Dhiraj Singh/Bloomberg

Small-cap biotech stocks are lagging this year with the spotlight squarely on their larger rivals who have been in a position to supply the world with Covid-19 shots and treatments.

Pfizer Inc. reached record highs on news last week that the White House would issue new guidance for booster shots, while its vaccine partner BioNTech SE and Moderna Inc., also making virus inoculations, have delivered triple-digit gains this year. Small-cap biotech stocks by contrast are down for the year, based on various measures, but analysts and investors expect this cohort of the sector will soon play catch up.