The life sciences sector has emerged into the spotlight ever...

The life sciences sector has emerged into the spotlight ever since the pandemic began.

In the US, the share prices of major vaccine-producing companies have surged astronomically as COVID-19 ravaged the world.

Nasdaq-listed BioNTech, which co-produces a vaccine alongside Pfizer, rose by a massive 253% in 2021.

Moderna rallied by 150%, while Pfizer is up 40% for the year.

In Australia, the Healthcare sector is also one of the top performers in 2021, beating the likes of Tech as well as the benchmark index.

ASX 200 benchmark	10%
XDJ Discretionary	21%
XEJ Energy	-0.49%
XFJ Financials	16%
XHJ Health	9%
XIJ Tech	0%
XMJ Materials	0.08%
XNJ Industrial	8.65%
XRE Real Estate	15%
XSJ Staples	7%
XTJ Communications	26%
XUJ Utilities	-2%

Despite the strong returns, investing in the life-sciences sector is still considered by many to be high risk.

Statistically speaking, life sciences companies have a 5 to 15 per cent success rate on products they attempt to commercialise, according to aresearch report released by the ASX.

And generally speaking, it takes those companies about 10 to 15 years to achieve commercialisation, longer than the average in other sectors.

Most early stage biotechs operate for long periods of time before they achieve some sort of measurable revenue.

Like investors in the mining industry, biotech investors have to tolerate high levels of risk, but significant returns could be enjoyed when investments are successful.

Biotech companies also have to navigate unique challenges around regulatory compliance, clinical innovations, costs, and pricing.

But when it comes to healthcare research and development (R&D), Australia has always ranked in the top 10 OECD member nations for its total investment on R&D.

The ASX healthcare sector represents a very small market globally, with approximately 1% of the global medicinal sales, but we stand to capitaliseon the rapid growth of our densely populated neighbours.

Biggest medical breakthroughs this year

Breakthroughs in the medical world often represent life-changing events not only for the investors, but also for suffering patients.

Outside of COVID-19 vaccines, the biggest medical breakthrough this year was arguably Biogen’s controversial US FDA approval of Aducanumab, a drug that treats Alzheimer’s disease.

It was the first FDA approval for Alzheimer’s in 18 years, but experts are sceptical and the Biogen stock price has tanked 40% since the announcement was made in May.

On the ASX, there were also major groundbreaking announcements.

In early December,Neuren Pharma (ASX:NEU) share price doubled in one day after revealing that it was close tolaunching the first ever drug for Rett syndrome to the market.

The company reported positive top-line results from the Phase 3 Lavender study of trofinetide, its lead asset used to treat indications of autism.

It was the first drug that’s ever been approved for Rett (a rare genetic neurological disorder that affects girls), and will result in a payday for Neuren worth hundreds of millions of dollars.

Earlier in the year, Patrys (ASXAB) announced that new preclinical data for its deoxymab antibody, PAT-DX1, has been published in the leading, peer-reviewed Journal of Clinical Investigation – Insight.

The groundbreaking results demonstrated the ability of Patrys’ PAT-DX1 antibody to cross the blood-brain barrier, which could significantly inhibit the growth of cancers in the brain.

ImpediMed (ASX:IPD)announced that SOZO has received a US FDA Breakthrough Device Designation for treatment and diagnosis of renal failure.

This was a major breakthrough for the medical world as the current process, which utilises weight scales to determine accumulation of fluid, has significant deficiencies.