It often seems that Wall Street picks the latest "hot" tech stocks based on little more than a sexy name. In the biotechnology arena, especially, there's a surfeit of both sexy names (Ariad, Biomatrix, Mitotix, Valentis) and uninformed investors. When President Bill Clinton and British Prime Minister Tony Blair issued a joint statement in March endorsing the immediate release of raw DNA sequence data by labs doing genomic research, flighty investors assumed that the two governments planned to restrict the patenting of human genes, sending the stocks of firms such as Celera and Incyte into a nosedive. In fact, both Britain and the United States already openly share genetic data. Investors "don't understand what they're investing in," one industry expert told Science magazine.

For any trader with an attention span longer than seven days (the average churn time for stock in Amazon.com, according to Business Week), Cynthia Robbins-Roth's new book should make it possible to buy and sell biotech stocks more intelligently. Robbins-Roth is a former Genentech scientist, a biotech columnist for Forbes and the founder of BioVenture Consultants, which advises venture capital firms. She describes the combination of daring, ingenuity and luck that helped mavericks like Genentech, Amgen and Genzyme put the industry on the map in the 1970s and 1980s, then explains how the giant pharmaceutical companies have come to dominate the labs, clinics and boardrooms where the contest for biotech profits is played today. Biotech, which accounted for more than half of the $6 billion earned by the top nine biopharmaceutical companies between April 1998 and March 1999, "has evolved into the research and development force supporting the drug industry," she observes. That means investors need to pay attention to a company's science and to the products in its pipeline.