Background: The valuation of Biotechnology companies is difficult in many ways. Patent and human capital are hard to value and also there is a great uncertainty about the success of the compaines research programs. Are traditional valuation models really useful when it comes to research companies or do they result in false values of the companies?

Purpose: To study what values different valuation models gives biotechnology companies and how they correspond to the market value. Method:We have studied financial litterature och found the most common used models today. We also interviewed a leading financial analyst in the area to get his point of viwe. We then used these models on a number, picked by us, biotechnology companies. The data we based our research on is collected from year- end reports and interviews with the selected companies.

Result: We found a connection between certain valuation models and the share price today. The best result is achieved when multiple models are used to get a thorough picture of the biotechnology companies.