The biotech industry has been shaking up the pharmaceutical space for the last several years, and that disruption is only growing. Globally, the biotech market was worth about $1 trillion as of 2021, and it’s expected to see a compound annual growth rate of about 14% over the next eight years.
The government has supported many biotech initiatives aimed at modernizing the regulatory framework, improving the processes for treatment approvals and reimbursements, and standardizing clinical studies. As a result, it’s easy to see why biotech is growing so rapidly, so investors would do well to track the most important biotech trends of the coming years.
This trend has been growing in recent years, and that growth is expected to continue in 2023. The personalized medicine market was estimated to be worth about $493 billion in 2020 with an expected compound annual growth rate of 6.2% from 2021 to 2028.
Much of the industry’s growth can be attributed to growing interest in identifying biomarkers for use in therapy and diagnosis of chronic illnesses. Cell and gene therapies are also capturing significant interest, with companies in the space attracting more than $23 billion globally last year, a 16% year-over-year increase.
In 2021, leading players in the gene therapy space enjoyed some clinical successes, including promising results for a treatment for transthyretin amyloidosis developed by Regeneron and Intellia Therapeutics. Market watchers also observed growing demand for treatments for other chronic diseases such as various types of cancer, age-related macular degeneration, almost all types of arthritis, and diabetes.
Bioprinting and tissue engineering
Bioprinting uses bio-inks developed from biomaterials. Biotech firms use cells like substrates that grow around a scaffold, enabling bone, skin or vascular grafts to develop from the patient’s own cells. Bioprinting is also a form of personalized medicine.
A related area is tissue engineering, an area that has grown sharply over the last few years due to advances in bioprinting. Tissue engineering makes it possible to create tissue grafts to treat burns from the patient’s own body. These tissue grafts can also be used in transplanting organs and regenerative medicine.
Another biotech trend for 2023 is the growth of orphan drugs. A new report from market intelligence and predictive analytics provider Evaluate states that the market for orphan drugs is growing more than twice as fast as the non-orphan drug market.
The firm expects that orphan drug sales will account for 20% of all prescription drug sales and nearly one-third of the value of the global drug pipeline by 2026. Evaluate also estimates that the orphan drug market will enjoy a compound annual growth rate of more than 12% between 2021 and 2026.
The firm expects each of the top 10 orphan drugs in 2026 to be worth between $3 billion and $13 billion in 2026 — making them larger than more popular mass-market drugs. According to Evaluate, more than 50% of the approvals handed out by the Food and Drug Administration last year were for orphan drugs that treat rare diseases.
Biotech is also playing an important role in the research process for drug discovery. Traditionally, it took years to uncover compounds capable of treating various diseases. However, many biotech firms have developed platform technology that cuts down the discovery time dramatically.
Biotech firms use drug platforms to discover and develop new medications using similar technology. Similar to how automakers build multiple models on the same platforms, like how Tesla builds the Model S and Model X on the same platform, drugmakers can build multiple drugs on the same platform.
By building on a platform they have used before, drugmakers already have an idea about the safety profile of any new medications they develop on that same platform. They also know what else to expect when building on that same platform, like potentially which diseases could be treated using that particular platform. Thus, the drug discovery process accelerates because the biotech firm isn’t starting from scratch each time.
For example, antisense therapies target messenger RNA to treat chronic and usually rare diseases. These drugs can alter the expression of the mRNA via various mechanisms, like reducing the number of disease-causing proteins in the patient.
Antisense treatments for a variety of diseases are in development, including Duchenne muscular dystrophy, Parkinson’s disease, Alzheimer’s disease, amyotrophic lateral sclerosis, also known as Lou Gehrig’s disease, and others.
Many other types of drug platforms have also been reducing the drug discovery time. Some other drug platforms include monoclonal antibodies, small molecules, gene therapy and cell therapy.
Gene editing and CRISPR diagnostics
In addition to improving treatments, biotech is also accelerating diagnostic results. CRISPR is a gene editing tool that speeds up the process of getting test results while also making many tests more affordable. One way that CRISPR technology makes diagnostics more affordable is by allowing the tests to be performed in the patient’s home.
CRISPR technology is actually a form of gene editing, and other forms of this technology are also making waves in biotech, especially in treating genetic disorders and other chronic illnesses. Gene editing involves adding, replacing or neutralizing specific genes.
Gene editing and sequencing are also making precision medicine possible. This technique enables doctors to figure out which treatment will work best for a specific patient. Precision medicine also enables doctors to personalize treatments in certain diseases, including various types of cancer.
Biotech startups are also utilizing precision medicine for drug discovery, gene therapy development and other drug delivery technologies.
Many other types of technology used outside biotechnology are also impacting the sector in a variety of ways. For example, artificial intelligence and big data are changing the way many pharmaceutical companies develop new medications and uncover novel drugs.
AI also helps them screen biomarkers and sift through copious amounts of scientific literature. Additionally, biotech firms use algorithms to quickly detect various traits like cancer cells on medical scans. AI and deep learning are also useful in the analysis of microbiomes and development of rapid diagnostics.
Further, the amount of data on biotech-related topics is growing rapidly and coming from multiple sources. Individual patients are even generating large amounts of data from the sensors and connected medical devices they wear. As a result, biotech firms are tapping artificial intelligence to help them analyze all that information and turn it into something they can actually use.
As the biotech industry grows and accelerates, the investment opportunities in the space are only going to explode further.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.