March 18, 2026

Should Extel Rankings Be Considered When Biotechs “Choose” Covering Analysts for Their IPO?

Let’s start with some quick reminders. Prospective public biotechs need to maximize their equity research coverage from the get-go. This typically means picking an IPO banking syndicate containing at least four underwriters (investment banks), which in turn should garner you four covering analysts 25 calendar days after your stock starts trading (which is the end of the “quiet period” and the soonest banks publish reports initiating coverage).

We advise our clients to pick their syndicate wisely – informing them that they “date the banker but marry the analyst” at each respective bank.

But how can biotechs compare analysts at different banks? Is there an objective ranking or methodology that can help in this regard?

Some might say, “Yes,” and point to Extel’s analyst rankings as an appropriate guide. But this article has been specifically written to educate you against such poor counsel.

What are the Extel rankings?

Just in case you’ve never heard of them, the Extel rankings used to be called the Institutional Investor (II) rankings. However, when the company’s ownership and branding shifted (first from Institutional Investor to Euromoney, and then finally to Extel), the name “Extel rankings” replaced what most people on the sell- and buy-side still instinctively call “Institutional Investor rankings” or “II rankings.”

They are an annual survey (undertaken by Extel), which ranks (based on institutional investor votes) the top equity analysts/teams across a plethora of industry verticals, geographies and (small/mid/large) capitalizations (note: for completeness, they also rank fixed income analysts, trading and execution, etc.).

The Extel All-America Research Team rankings are typically published in late October. In their 2025 survey, Extel sought to determine the top analysts in the following Healthcare subdivisions:

• Biotechnology Largecap.
• Biotechnology Small & Midcap.
• Health Care Facilities & Managed Care.
• Health Care Technology & Distribution.
• Life Science & Diagnostic Tools.
• Medical Supplies & Devices.
• Pharmaceuticals Major.
• Pharmaceuticals Specialty.

What Extel rankings actually measure

The first thing to understand is what Extel rankings are, and just as importantly, what they are not. Rankings are based on buy-side votes collected through a paid-for survey process run by Extel. Asset managers are asked to rank analysts across sectors, and the aggregated results are then sold back to banks, investors, and others who subscribe.

That process matters. Because while the rankings are notionally about analyst quality, in practice they are heavily influenced by salesforce effort.

Banks with large, well-resourced sales teams spend months encouraging their clients to vote for their respective analyst teams – reminding them, nudging them, and in some cases even walking them through the process. The analysts at those banks benefit accordingly at the expense of smaller banks. Smaller platforms, and newer teams, may deliver excellent biotech research, but lack the sales footprint to generate meaningful votes for the survey.

Consequently, the Extel rankings are more often a proxy for a bank’s sales coverage and client touchpoints, rather than a clean measure of analytical insight, scientific understanding, or long-term commitment to a specific biotech story.

What should matter to IPO-stage biotechs when “choosing” analysts

Would-be public biotechs should make sure their prospective covering analysts:

• Understand the company’s development strategy.
• Can communicate the investment case clearly to investors.
• Have the bandwidth to be available, responsive, and engaged as a biotech’s story evolves.
• Can provide a thoughtful and credible interpretation of clinical data once generated.

And, in fact, some of the most effective analysts exhibit traits that would cause them to place especially poorly in Extel’s survey rankings:

• They might cover fewer names than average but know them deeply.
• They could have spent years in a specific therapeutic area.
• They may work at a bank without the scale to dominate surveys like Extel’s.

Finally, note that for biotechnology, Extel only distinguishes between analysts who cover “Largecap” and “Small & Midcap” – and not oncology, endocrinology, neurology, dermatology, or ophthalmology companies (which would be of far more interest to biotech IPO candidates).  

Extel rankings suffer from a lack of visibility

There is another practical issue that often goes unspoken when considering how important Extel rankings are to biotechs considering an IPO: Extel rankings are only visible to paying subscribers.

Many specialist healthcare funds – particularly newer, smaller, or more concentrated ones – do not subscribe to the survey results. Nor do private investors, or even many generalist institutions.

As such, the full results remain shrouded, while banks’ marketing departments mine and cherry-pick from the data to pitch themselves in the best possible light.

What’s a better way to choose covering analysts for your IPO?

• The ~four analysts biotechs typically come out of an IPO with should be the company’s biggest cheerleaders on Wall Street.
• You should know them intimately, and your relationships with them should have been cultivated over (at least) the two years leading up to your IPO.
• They should understand your science/development strategy and be enthused by it.
• They should have enough time to cover you (not already have too many companies under coverage) (note: ask for their coverage list).
• They should command respect from the street so that when they publish their thoughts/insights into your data/strategy they are listened to and believed.
• They should want to help you – this means going above and beyond just publishing notes – by helping introduce you to investors, inviting you to their investor conferences, arranging salesforce teach-ins, fireside chats, KOL events, etc.