Biotech's sustainable boom

Healthcare

The biotech sector is booming with revenues for the entire industry reaching $64bn in 2012, in part thanks to capital markets. Kate Bingham, IBT investment manager and managing partner, SV Life Sciences Managers, explains why the sector's growth is not a bubble.

The biotechnology sector has grown spectacularly over the past five years since the global financial crisis. It has outperformed the S&P 500 index by over 100% in the five years to April 2013, with the NASDAQ Biotechnology index (“NBI”) growing 131% versus the S&P 500’s 29%. This is as a result of exciting new drugs and technologies being developed at record levels.  With share prices surging, the biotechnology index has been catapulted to new highs above the “dotcom/genomics bubble”-era peak back in early 2000.  As a result, investors are wondering whether we are in the midst of another...