The Case for Investing in Biotech

INN takes a look at what developing sector of the life science has to offer in 2017

investing in biotech

Biotechnology has fully cemented itself as a distinct side of the life science market, often offering companies the availability to work in pharmaceutical more general health products.

As with almost all of the life sciences, biotech companies face vigorous testing from several regulatory agencies and must make precise choices on pricing, products, marketing and much more. Many experts in biotech have been on hold as to a proper outlook for the sector in its largest market, the US, given that there still isn’t a clear picture of what the health care situation will be for Americans moving forward. A market report from Deloitte on the whole life science sector indicated a projection of $8.7 trillion by the year 2020.

According to a commentary from, the developing oncology area has been one of the main driving forces behind the resurgence of biotech in 2017. “The Oncology segment is one of the largest markets in medicine that’s expected to grow to $165 billion by 2021,” the report said. With that in mind, here the Investing News Network (INN) provides a quick insight into the sector to help better make a case for investing in biotech.

Investing in biotech: the biggest locations for biotech

The US and Europe still play a significant leading role in biotech, both as developers of new tech and the biggest consumers of such. However, emerging markets like China and India have shown an increased interest in more advanced therapies and medical equipment that would improve the quality of life for their patients.

More companies begun began to take trials oversees and realistically work in partnerships to develop their tech for emerging international markets in Asia.

At the beginning of 2017, Forbes wrote that despite the “abysmal” year for biotech during 2016, the biotech sector would see a continued spending from the private sector into biotech venture, with over $5 billion in acquisitions for public companies.

This year we have seen two reports indicate that despite tumultuous and unclear political and regulatory situation the biotech market has been able to thrive forward.

Still, despite the unknown variable of pricing, the case for investing in biotech stocks remains. The sector is immersed in the long-term goal of developing treatment for patients to combat diseases, making the upside potential of biotech stocks extremely encouraging.

An EY report indicated so far in 2017 the biotech sector has seen a bounce from the broader market and the “lure” of potential tax reform in the US.

Investing in biotech: ETFs give insight into overall market

The top biotech ETFs have seen a positive increases in 2017 so far with the NASDAQ Biotechnology (INDEXNASDAQ:NBI) going up 19.05 percent, iShares NASDAQ Biotechnology Index (NASDAQ:IBB) 18.75 percent, SPDR S&P Biotech (ETF)(NYSEARCA:XBI) 32.15 percent and the First Trust NYSE Arca Biotechnology Index Fund (NYSEARCA:FBT) 27.04 percent.

The performance of these stocks often provide a solid indication on the market’s feel regarding the whole biotech industry.

Don’t forget to follow @INN_LifeScience for real-time updates!

Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.

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