Executives, investors, analysts and bankers are readying pitches, finalizing schedules and fine-tuning presentations for biotech’s biggest event of the year. The JP Morgan Healthcare Conference kicks off Monday in downtown San Francisco after a record-breaking year of deals and amid a swirl of industry pressures.

The conference, which takes place at the Westin St. Francis Hotel on the lip of Union Square, is the industry’s oldest and largest gathering of biotech companies and investors. More than 300 companies turn out. Each year, attendees search for vital signs on stock values and potential initial public offerings, and watch for new product debuts. This year, they say, they will also listen closely for emerging trends in other rapidly shifting sectors such as digital health and diagnostics.

But perhaps most importantly, the meeting is a catalyst for deals and partnerships to be forged or finalized.

“Deals are done in the middle of Union Square; talks get underway in the line at Starbucks,” said Laura Vitez, a life sciences analyst for Thomson Reuters who has attended the conference since the early 1990s. “It's just a giant deal-making party.”

That high-powered networking is the reason why people such as Vitez, who lack tickets, still travel to attend the many satellite conferences, presentations and lectures that take place within close proximity of the main show. Aside from those caffeinated conversations, Vitez says she will also be watching for signs of whether last year’s dip in the number and value of biotechs that went public will deepen in 2016.

The past three years were fruitful for biotech IPOs, producing 167 — which is more than in the prior 13 years combined. But the number and value of those debuts dropped, from 71 IPOs that raised $5.2 billion in 2014 to 59 that raised $4.9 billion in 2015. No biotechs went public in the month of December — the first time that has happened since February 2013.

“The IPO window has not closed, it has narrowed a bit,” Vitez said. “That could end up driving prices down for [mergers and acquisitions], which is good for pharma but bad for biotech. So you sort of kill the goose that lays the golden egg."

Representatives from today’s pharmaceutical giants — from Pfizer to Novartis to Johnson & Johnson — always attend the conference because they rely heavily on biotechs to generate promising discoveries worth buying up.

It’s not just the headline-grabbing acquisitions that matter, though. Less visible conversations that shape partnerships and licensing agreements are also underway. Niki Robinson, vice president of industry relations and development at Fred Hutchinson Cancer Research Center in Seattle, will pitch 25 research projects to a dozen companies next week in private meetings.

“Really it's just massive, massive networking,” she said. “It's a sea of suits.”

Robinson sees the conference as a rare opportunity to get in front of more than 4,000 investors and executives eager to support early discoveries. For her last job at Cincinnati Children’s Hospital, she attended the conference every year. Eventually, she doubled the number of commercial licenses that hospital launched and raked in more than $60 million in licensing fees.

Over the years, the conference has become about much more than biotech. Jonathan Palmer, a health care analyst for Bloomberg Intelligence, won’t attend this year, but said he’ll be listening for updates from Walgreens on its acquisition of rival drug chain Rite-Aid, which is under scrutiny by antitrust regulators at the Federal Trade Commission.

And as new medicines become more specialized and targeted, Palmer also expects to see diagnostic companies eagerly hunting for opportunities to create tests that will quickly and accurately identify which patients should receive them — a trend that he believes “will over time become the norm.”  

Yarmela Pavlovic, a partner at the law firm Hogan Lovells who specializes in medical devices, believes pressure to rein in healthcare costs will prompt companies to think earlier and harder about how insurers will treat their products once they finally reach the market. “Strategically, I think companies have to have the reimbursement plan in mind from early on,” she said.  

She thinks this is especially true for digital health products. These tools, which range from devices that can remotely monitor a patient’s condition to apps that help connect them directly to doctors, are heralded as potential game-changers that could cut costs for the healthcare system and improve care delivered to patients. But manufacturers will need to prove their worth in order to earn coverage from private insurers and federal programs such as Medicare.

Stepping back from the flurry of the preparations, Vitez said she is most eager to hear updates from companies that she hopes can deliver breakthrough treatments and shape the future of medicine. “I want to see us make progress against disease,” she said. “The conversations that happen at JP Morgan are fundamental to that.”