Genentech raised nearly $2 billion during its second initial public offering (IPO) on July 20 when Roche Holding refloated part of the company after acquiring all outstanding shares in June (Nature Biotechnology 17, 634, 1999). Twenty million shares were sold at $97 per share, raising nearly $2 billion and increasing Genentech's value from $11 billion to $15 billion. "This is very good news in general for the industry," as it shows an awakening of investors' interest in biotechnology, says Steven Burrill, CEO of Burrill & Co. (San Francisco, CA). However, he points out that "the market is increasingly discriminating against smaller companies," rewarding only those biotech firms with actual or imminent sales and earnings. "Definitely, the bars have been raised," agrees Eric Schmidt, analyst at SG Cowen (New York), who says that "investors are no longer only interested in sexy science," but are focusing on companies with a good market reputation and promising drugs in final-stage development. For instance, Cubist Pharmaceuticals (Cambridge, MA), whose share price jumped 17% ($0.75) following the Genentech IPO, has a new antibiotic, daptomycin, in late-stage trials in the US and Europe. "Genentech['s success] will only reinforce the prevailing expectation of investors that products are important," adds Viren Mehta from Metha & Partners (New York).