It’s not very old when investors used to consider biotechnology as one of the riskiest sectors to invest money. According to them, one could make huge profits, but at the same time, chances of losing money were also very high. Against all such odds, perception of investors towards biotechnology seems to be changing nowadays. They are looking forward to giving the biotech shares a shot once again.
Why Is It A Risky Field:
Biotechnology is all about developing drugs. Between the development and the distribution of any drug, an important step comes i.e. government approval. No matter how effective one drug is, unless it gets approval from the government, it cannot be sent to market. It’s the main reason, why investors consider it a risky sector to invest money. The research and development process used by the biotechnology companies take years to finish, which reflects that development of a drug is not an easy process. But the thing that is more difficult is to convince FDA about that drug.
If you take into consideration the market situation around 2010-11 in the biotech industry, you can see that taking an approval from FDA required a lot of efforts then. Things have finally started to change for good. Companies can easily get approval if they follow right procedure without violating any rule. The speed of getting approval is faster in case of life-saving drugs. The turnaround has once again motivated investors to pay heed to this sector.
Market experts think that it is the starting of a new era in this sector, and the situation will continue to flourish in future. According to them, improved technology has made it easy for the FDA to give accurate decisions within least possible time. The world will see an improved investment trend in the biotech industry over next few years.