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Although the biotechnology industry has endured several Wall Street slumps over its 20-year history, the overall trends have been positive by many important measures: number of companies, number of approved products, market capitalization and revenues. Moreover, although investment has fluctuated, the larger trend has been positive, with each upturn resulting in a new peak.
New Biotech Drug and Vaccine Approvals/New Indication Approvals by Year
Despite volatility, IPO and investment trends are positive because the fundamentals of the industry are strong. The number of approved biotechnology medicines and vaccines has risen steadily over the last two decades, with the total number of biotech products on the market leaping seven-fold in the last 10 years.
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Biotech Revenues, Top 5 Companies
The goal of a biotechnology company is to build a revenue and profit-generating business, and here we see the spectacular and consistent revenue growth for the first generation of successful U.S. biotechnology companies - Genentech, Amgen, Biogen, Chiron and Genzyme.
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U.S. Biotech Revenues, 1992-2001
But growth has not been limited to the biotech industry's top companies. This graph tracks 10 years of revenue growth for all U.S. publicly traded companies.
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Capital Raised by Public Biotech Companies
The amount of capital invested in biotechnology has likewise fluctuated over the years, peaking alongside the IPO market. As with IPOs, each new peak has soared higher than any previous, with positive trends even in off years. Biotechnology has attracted more investment in 2001 and 2002 - two off years following the 2001 zenith - than in the entire five year period of 1994-1998, which included the previous peak, 1996.
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U.S. Biotech Employment, 1992-2001
As businesses grow, they hire more people, and the biotech industry is no exception. In just 10 years, employment within the sector more than doubled, to 191,000, while the number of jobs in related industries has followed a similar trajectory, rising from 230,000 to 535,000.
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No. of Biotech Companies, 1992-2001
Not only have individual companies grown over the last 10 years, the number of U.S. biotech firms has continued to climb, approaching 1,500 in 2001.
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U.S. Biotech IPOs
As the graph tracking biotech IPOs illustrates, the market peaked in 1983, 1986, 1992, 1996 and 2000. Note that each peak is higher than those that went before.
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