What is Biotech Sector?
Biotech firms range from early-stage clinical-trial companies (binary outcomes โ drugs either work or don't) to large commercial-stage names (Amgen, Gilead, Vertex, Regeneron). Big Pharma (Pfizer, Merck, Novartis, Roche) increasingly acquires biotechs for pipeline. Indian biotech (Biocon) and emerging-market biosimilar makers add global dimension.
Why it matters for investors
Biotech is high-risk, high-reward โ successful drug approvals can create multi-bagger returns, while trial failures cause stocks to fall 50%+ overnight. The sector is rate-sensitive (long-duration cash flows) and policy-sensitive (drug pricing, FDA decisions, Medicare negotiations).