The answer is that they probably can't. Markets don't move in smooth, incremental steps but in sudden bursts of enthusiasm and despair. Still, people can learn from the experience of the past few years, and avoid making some obvious mistakes. A starting point is to understand the ways that biotech is like the computer-Internet revolution, and the ways it's different. One obvious shared trait is an entrepreneurial start-up culture.
Smart biologists are just as motivated by the marketplace as smart computer scientists.
And there's a similar willingness in both industries to take big risks in pursuit of big rewards. But when you look deeper, the two industries may have more differences than similarities. The biggest false analogy is between . . . Biotech, partly for that reason, probably won't produce behemoths such as Microsoft or Cisco Systems that can seize control of a particular wave of technology and dominate the market until the wave crests. Instead, there are likely to be many dozens of smaller companies, each owning patents to particular genes that can produce life-saving drugs.