Amid the pandemic, the sector showed significant progress and outgrew other sectors.
Biotechnology – Revolutionising Medical Treatment Beyond the Pandemic
Biotech Innovations Remain at Forefront
A perfect example of how innovation is driving rapid drug development is the biopharma industry’s response to the COVID-19 pandemic. The entire industry mobilised in response to this global emergency, and companies have managed to leverage their innovative drug/vaccine discovery platforms and move candidates into human testing at an unprecedented pace.
However, opportunities in healthcare and biotech extend well beyond responding to pandemic outbreaks.
Why Biotechnology?
#1 Outpacing other sectors
#2 Improving lives & health
From vaccines and cancer treatments to immunology and gene editing, biotechnology is making waves in all the right places.
#3 Compelling investment landscape
At 33%, health makes up a sizable chunk of the biotechnology investment landscape.1
Opportunities in Biotechnology
Long-term growth drivers in biotechnology remain intact
Demographic Trends
Aging global population will continue to drive health care demand, including pharmaceutical drugs.
Increased R&D
R&D spending has more than tripled in the past 10 years2 in view of the need for new treatments.
Innovative Drugs
Recent surge in novel drugs and better treatment modalities driven by advances in biology and medical technology.
I think the biggest innovations of the 21st century will be at the intersection of biology and technology.
Opportunities in Biotechnology
Recent advancements in areas such as data processing, cloud computing, machine learning, and artificial intelligence are paving way for a fusion of biology and technology.
Explore more, here’s a view of the vast potential of biotechnology:
- Leading the health care industry
- Strong Growth
- Larger opportunity set
Leading the health care industry
Biotech – Leading the health care industry in investment activity
Top 5 US Healthcare Industries in Q1 2021
Biotechnology saw the highest investments from Venture Capital within the healthcare sector. Of USD11.7 billion raised in Q1 2021, USD6.5 billion (>50%) was invested in the Biotechnology subsector3
Strong Growth
Biotech Sales Growth Outpaced Other Sectors
Positive Biotech Fundamentals
10-year sales compound annual growth rate (%)4
2010-2020
Strong sales growth contributes to healthy company financial statements
Larger opportunity set
Investors now have a larger opportunity set to position themselves in medical biotech
As of June 2021, there was 445 biotech companies with a total market cap of USD1.4 trillion in the U.S.5:
Growth of biotechnology companies in the U.S.
Footnotes
- Source: Food and Drug Administration’s (FDA) Center for Drug Evaluation and Research (CDER). As of 22 January 2021
- Source: Bloomberg LP. As of 31 December 2019. Based on holdings in the NASDAQ Biotechnology Index from 2009 through 2019.
- Source: PwC/CBInsights HealthCare Moneytree report, data is current as of March 31, 2021. Past performance is no guarantee of future results. Chart is provided for illustrative purpose only.
- Source: FactSet. As of 31 December 2020. Updated Annually. The compound annual growth rate (CAGR) is the rate at which something (e.g. revenue, savings, population) grows over a period of years, taking into account the effect of annual compounding. Sectors shown are represented by the corresponding S&P 500 sector index, each which is comprised of those companies in the S&P 500 Index that are classified as members of the appropriate GICS® sector. STANDARD & POOR’S®, S&P® and S&P 500® are registered trademarks of Standard & Poor’s Financial Services LLC. Standard & Poor’s does not sponsor, endorse, sell or promote any S&P index-based product. Indexes are unmanaged and one cannot invest directly in an index. They do not reflect any fees, expenses or sales charges. Past performance is not indicative of future performance.
- Source: S&P Dow Jones Indices, as of 30 June 2021. Data from Jan 2009 to June 2021. Past performance is no guarantee of future results. Chart is provided for illustrative purpose only. Number of biotech companies in the U.S. as measured by the S&P Total Market Index.
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