April 30, 2025

How Do “Sales Teach-ins” Fit into A Public Biotech’s IR Program? And How Often Should They Be Utilized?

A sales teach-in is one of the marketing tools public biotechs can use to spread their investment story as far and wide as possible. Consequently, they can form an important part of a company’s investor relations plan. This blog explores their usefulness and how often biotechs should utilize them. Before we begin, let’s briefly talk about the target audience for a sales teach-in – an investment bank’s salesforce.

What do an investment bank’s salespeople do?

Salespeople “service” a bank’s client base – which usually consists of pension funds, hedge funds, sovereign wealth funds, private family offices, and other buyside institutions.

“Servicing” in this context means offering them regular ideas on how to make money: buy this stock, short that stock, buy this derivative, participate in that IPO, etc. This typically happens daily, by phone or email. 

Salespeople do not generally come up with investment ideas themselves – these typically come from research analysts or traders – but salespeople are the ones communicating the ideas to clients and “owning” the relationship with them.

Salespeople take orders (trades) from their clients and earn commission for the investment bank they work for. Their pay is usually proportionate to how much commission (or profit) they make for their bank.

What’s the point of a sales teach-in for a biotech?

While an analyst might cover 20-40 companies – salespeople need to be able to sell almost any investment idea the bank comes up with. As such, even if they are a healthcare specialist, they will have limited or transitory knowledge of literally hundreds of companies.

The point of a sales teach-in is to shine a light on a biotech’s investment thesis, principally for one of three reasons:

• The bank’s equity analyst has just initiated research coverage on a new biotech (potentially, though not always, after an IPO) and is looking to educate the bank’s salesforce.
• The biotech in question has a major milestone or inflection point approaching, which presents an investment opportunity for clients (and a trading opportunity for the bank’s salesforce).
• The biotech represents one of the analyst’s best ideas – meaning they believe it to be one of the companies they cover with the highest potential upside relative to risk.

Note that all three of the above scenarios involve the investment bank having already published equity research on the biotech in question.

It’s rare that a bank would allow a sales teach-in to take place in the absence of coverage, given that the event would then likely lack a sponsor (the analyst), there would be no trade recommendation (buy, hold, sell), and no internal expert to answer follow-up questions from clients.

What happens in a sales teach-in?

Typically, a sales teach-in consists of a biotech’s management giving an abbreviated, high-level version of their corporate presentation directly (in person or via Zoom/Teams) to a bank’s sales team.

The bank’s analyst may introduce the company to the sales team, but the point is to let the sales team hear directly from management. The analyst may lead Q&A, but this doesn’t have to be the case.

A teach-in will typically last around 30 minutes – about the same time as a presentation at a healthcare investor conference, or about the average time allocated to a typical one-on-one investor meeting.  

Sales teach-ins are usually made to only one bank’s salesforce at a time. They are non-public, internal meetings in this regard. 

What is the benefit to a biotech?

The goal of a sales teach-in is to build familiarity with your story. Remember: not every biotech has the privilege of presenting directly to a bank’s salesforce. In the same way that biotechs meeting investors face-to-face – or repeatedly over a period of time – builds trust, the same is true of sales teach-ins and salespeople.

Two things should be more likely to occur following your sales teach-in:

• You may see increased interest in your stock in the near-term, as salespeople revisit their analyst’s Buy recommendation on your stock. Note: banks are very unlikely to facilitate sales teach-ins for biotechs with Hold recommendations, and biotechs with Sell recommendations are unlikely to want to participate in such events.
• Salespeople are more likely to share your future news (as well as their analyst’s updates on you) with their clients, based on their enhanced understanding of your story.

How frequent are biotech sales teach-ins?

It’s rare that salespeople get to hear directly from a biotech’s management. After all, the point of having a department of equity analysts is for them to act as an intermediary and provide context for, and analysis of, each company announcement.

Moreover, sales teach-ins work best where there is a near-term trade to be made (ahead of a potential catalyst, say), since this tends to galvanize a commission-focused salesforce. In other words, sales teach-ins are unlikely to be even annual events.  

Are they a good use of management’s time?

Sales teach-ins are useful tools to help shine a spotlight on a biotech’s story.

As with all spotlights however, those being illuminated need to make sure they are worthy of the attention. While a teach-in should leave attendees with a good impression, a poor, unprofessional or misguided performance can tarnish a biotech’s reputation.

Management should also take advantage of the combined access they get to a salesforce and analyst at a teach-in. Together, these parties have their finger on the pulse of the market and should be able to provide useful insights to management around trading dynamics or peer comparisons/perceptions.