Industry observers argue that medical technology companies can tap into increased healthcare spending among emerging economies while the U.S. market has matured and could experience slower growth. Looking ahead, in the years through 2024, spending growth is projected to average 5.8% and peak at 6.3% in 2020.

Bolstering biotechnology’s prospects is a speedier approval process by the U.S. Food and Drug Administration. In 2012, the FDA was given the authority to designate certain drugs as a ‘breakthrough therapy,’ which then allowed that drug to move through the approval processes more quickly,” said Morningstar.

“What has truly enhanced the growth in biotech is the long sequence of M&A and IPO announcements that have taken place in the cash-flush industry. In late 2017 to early 2018, three acquisitions from Sanofi SA, Celgene Corporation and Gilead Sciences alone had the pharma giants moving $30 billion in capital. And Q1 2018 racked up about $47 billion in M&A. On top of that, here have already been 33 IPOs over the first seven months of the year alone,” adds Direxion.

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