For decades, investment in the life sciences sector was mainly channelled through large pharmaceutical companies in oligopolistic or quasi-oligopolistic situations. This began to change in the 1980s with the emergence of new players. Some emerged by taking advantage of structural changes in the sector, such as generic drug manufacturers. Others relied on discovery and innovation to explore new territories. The latter category is now well established in the stock market landscape. These players, commonly referred to as "biotechs", have even become an investment theme in their own right, with their own specificities, codes and unprecedented scale of risk.
Biotechnology... a sector that investors love, even if it often gives them a hard time. In the stock market, investing in a "biotech" is to aspire to the thrill of the clinical success of a slowly maturing treatment. But for a success, how many failures? Investing in a biotech player means accepting a less rational approach to the market. It is also a high-risk gamble that requires strong nerves. At first glance, you even have to be a little reckless to invest in a biotech. It's like investing money with maximum risk in the hope that, after a long and complex process, the company will commercialize a product or technology that will bring in millions or even billions.
Currently, about 4 out of 5 drugs in development are derived from biotechnology research, which says a lot about the importance of biotechnology research. On the stock market, the sector is very popular, much like the Internet stocks of the late 1990s. Investors are hoping to make large capital gains, much more than they are likely to get from a player in the traditional economy. But there is always a counterpart with extraordinary potential: it is an extraordinary risk.
The following list includes a panel of major players in the sector: it is a list of discovery, not investment. It has been deliberately limited to laboratories whose capitalization is already high, by applying a limit to the number of US stocks, which largely dominate the sector.