Breast Cancer – Investments Thesis

SECTOR

Those companies looking for vaccines, better treatments, or solutions to diseases fall into the Healthcare sector in the United States. This sector tends to be very broad and accounts for about 14.2% of the total composition of the S&P 500¹, second only to the Technology sector. In this way, it is possible to understand how relevant these companies are.

But we need to be more specific, as the Healthcare sector is vast. Biotechnology companies are usually companies focused on finding solutions to various problems, diseases, and viruses that end up appearing in our society.

According to finviz.com, on October 19th, about 1037 companies are listed on the American stock exchanges, with a market value ranging from $4 million to $80 billion². It tends to be a capital intensive sector, it requires much money to invest in research and time to arrive at the expected results, and it can take up to decades to reach any conclusion.

But they are necessary companies for breast cancer research, which have had attractive growth. In 2010, global sales in the biotech sector were $120 billion³. While today, in 2020, it is estimated at $277 billion, an average growth of 9% per year, and reaching the employment of around 200,000 people around the world.

BREAST CANCER AND STATISTICS

Breast cancer is a problem that affects women worldwide and even men (rarer cases). But looking at the data in the United States, studies show that 1 in 8 American women (about 12%) will develop invasive breast cancer in their lifetime.

By 2020, it is estimated that more than 276,000 new cases of invasive breast cancer are diagnosed in women in the United States⁴.

Although the Mortality Rate has stabilized for women under 50 years old since 2007 and even dropped for women over 50 years old, the rate is still high compared to other cancers, second only to lung cancer.

Source: https://gis.cdc.gov/Cancer/USCS/DataViz.html

The risk of breast cancer in a woman almost doubles if she has a first-degree relative (mother, sister, daughter) who has been diagnosed with breast cancer. Less than 15% of women who get breast cancer have a family member with the diagnosis. However, about 85% of breast cancers occur in women without a family history of breast cancer.

According to CDC – Center for Disease Control and Control, in 2017, the last year for which incidence data are available, in the United States, 250,520 new cases of female breast cancer have been reported among women, and 42,000 women have died from this type of câncer⁵.

Even with the Mortality Rate remaining stable, the number of new cases in the United States has only increased year after year, with an average growth rate of almost 2% per year.

Source: https://gis.cdc.gov/Cancer/USCS/DataViz.html

Therefore, keeping an eye on the companies that are working to operate in this segment, with a focus on better treatments and new drugs, is a way to diversify their investments into the health care sector and, in a way, contribute to this researches.