Over many decades, Warren Buffett has generated enormous returns for himself and his investors. Buffett has become more interested in biotech stocks. This essay will evaluate Warren Buffett’s biotech stock purchases and his investment strategy.

Berkshire Hathaway

One of Buffett’s biggest investments over the past decade has been in biotech stocks. His focus on these companies has helped Berkshire Hathaway achieve impressive outperformance.

However, investing in biotech can come with risks. In particular, there’s a chance that many of the products being researched or developed will never make it to market.

This makes it a risky investment for Buffett. It’s also worth noting that he’s had several healthcare investments go bad over the years.

Biogen, for instance, is a leading player in multiple sclerosis (MS) spaces. But the company’s MS drugs have been losing ground recently in response to fierce competition.

Biogen

Biogen (BIIB -0.24%) is a research-focused company that develops drugs for diseases such as multiple sclerosis, cancer, and Alzheimer’s disease. Its drugs are sold in the US and abroad.

For example, Biogen’s Spinraza treats the debilitating disease of spinal muscular atrophy. The drug is one of the most expensive treatments on the market, but it can significantly improve a patient’s quality of life.

Biogen also has a portfolio of medicines for diseases such as diabetes and cancer that it is trying to commercialize. These drugs are expected to help the company grow its revenue in the coming years.

Merck

One of the world’s largest pharmaceutical companies, Merck manufactures a wide range of prescription medicines, vaccines, and biologic therapies. The company also has an animal health division and a pharmaceutical distribution business.

Among its key products are cancer treatment drugs Keytruda and Gardasil, a vaccine for HPV and chickenpox. The company also produces antidiabetics and birth control pills.

Merck is a company that has been around for more than 200 years and has a long history of making drugs and medicines. It has produced a number of well-known drugs and products, such as morphine, the first commercial smallpox vaccine in the United States, and 4.18 billion units of penicillin during WWII.

AbbVie

AbbVie is a pharma company that develops medications used to treat cancer, arthritis, hepatitis C, and other diseases. It has several drugs that are highly popular and sold globally.

Its largest drug is Humira, an immunosuppressant for the treatment of rheumatoid arthritis and other inflammatory conditions. It also makes antibiotics, painkillers, and other drugs.

Founded in 2013 as a spinoff from Abbott Laboratories, AbbVie is a research-driven biopharmaceutical company. Its research includes therapeutic areas such as immunology, chronic kidney disease, hepatitis C, women’s health, and oncology.

Its pharmaceuticals are sold in 81 countries. The company sells products through suppliers and pooled procurement in an additional 64 countries. It also engages in non-exclusive voluntary licensing for two compounds, enabling generic supply in 79 countries. Its access-to-medicine strategy has measurable objectives and is integrated into the overall corporate strategy.

Bristol Myers Squibb

Bristol-Myers Squibb is a diversified specialty biopharmaceutical company with pharmaceutical products and experimental therapies in cancer, heart disease, HIV and AIDS, diabetes, rheumatoid arthritis, hepatitis, and transplant rejection.

Bristol Myers Squibb has a strong global access strategy and integrates this with its overall corporate strategy. It provides evidence of financial and non-financial access-related incentives at the executive level but does not disclose whether in-country managers are also incentivized to deliver on their access goals.

It has comprehensive access plans in place for 73% of its late-stage R&D projects. Several of these include commitments to registering the product in countries where clinical trials have been conducted.