Some hefty share price falls are reflecting growing concerns about the economic outlook.
Australian biotech companies are taking a battering as investors reduce their exposure to risky stocks amid concerns about the economic outlook.
While the All Ordinaries gained about 1 per cent in the first quarter, Intersuisse said its biotechnology index fell 15 per cent.
eG Capital, which also runs a biotech index, said Australian-listed biotechs had significantly underperformed on the ASX Small Ordinaries Index in the past six months.
Investors are not optimistic about the outlook. "We do not see an early rise for biotechnology stocks," Peter Russell, from Intersuisse, said. Money was being taken off the top end of the market and the bottom.
"Biotech's not defensive . . . and it doesn't have the certainty that you see in . . . oil stocks and a number of the resources areas and coal where the good times are going to roll on a bit longer," Mr Russell said.
"The market's not very interested and I think those that are interested in the market have seen the decline and better opportunities elsewhere."
Australian Cancer Technology was among the biggest biotech losers in the first quarter, with a share price fall of 45 per cent. Safety syringe maker Occupational Medical Innovations was down 44 per cent, and lipid maker Clover Corporation and pharmaceuticals maker Meditech Research were both down 40 per cent.
eG Capital said ASX-listed biotech stocks had gained just 5 per cent in the past six months compared with the Small Ordinaries Index at 10 per cent. The All Ordinaries remained up 13 per cent to the end of last month. A weaker US Nasdaq, which has lost 7 per cent this year, has also not provided any positive sentiment.
"It's mainly because the hot money is going into the resource sector," eG Capital analyst Edward Chan said. "And biotech wasn't performing so well, so I suspect there was probably some profit-taking.
"Biotech is a high-risk sector and if other sectors outperform so well and seem so certain, that's why most people are attracted to that area."
But the analysts said biotech stocks should not be ignored. "Long-run, however, it will pay to build on a portfolio in these times," Mr Russell said.
While the sector is struggling, there are some strongly performing companies.
Auto-immune and respiratory diseases treatment maker Pharmaxis was up 66 per cent, eye treatment company Regenera up 47 per cent, and cell-culture company GroPep up 40 per cent.
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