Long before the Internet became the “Information Superhighway,” it was nothing more than an odd realm of scientists, academics, defense types and computer geeks.
Of course, it wasn’t long before scores of entrepreneurs and their venture capitalist friends recognized its profit potential and succeeded in turning it into one of the greatest investment opportunities of a lifetime.
If you were there in the ’90s, then you know exactly what I’m talking about.
If you weren’t, you ought to ask some of the people that were. I’m sure they will be happy to tell you about the fortunes they made back in the day investing in high-flying dot-com stocks.
I mean, Cisco Systems (NASDAQ: CSCO) went from its 1990 IPO price of $0.08 per share to $80 by 2000 for a gain of over 99,000%.
Now that’s one for the investment hall of fame. But like all great and bubbly investment opportunities, even the Internet eventually ran its course.
The next big thing
Ever since then investors have been looking for the “next big thing” that will storm the markets the same way the Net did over fifteen years ago.
So where is the next big thing lurking in today’s markets?…
From where I sit, it’s within the biotech sector.
That’s because ultimately I believe the biotech sector is on the cusp of revolutionizing the way we think about disease, cancer, disabilities and their eventual treatment options.
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And while these things have always been the stuff of our most hopeful dreams — to live without disease — I think what we’re going see in the future will dwarf the progress our grandparents witnessed in their lifetimes.
What makes the sector so different from the Internet, though, is these advances are not going to be delivered to us overnight. If the Internet was the hare, the biotech sector is definitely the tortoise.
That is just the nature of the beast and the aspect most investors seem to have the hardest time with.
In this arena, there are simply no short cuts. As a result, the road for these types of companies is long, expensive and arduous.
But I can tell you this: every time I sit down with the CEO of a biotech company, I realize they are all true believers in the roads they are traveling.
You see, by and large these CEO’s are quite different from the heads of firms in other industries. For biotech CEOs, it’s more about the science behind saving lives.
It’s also about meeting goals, producing desired results and pushing the ball closer and closer to the goal line. Without exception, these are really the smartest guys in the room, and I admire them for what they hope to one day accomplish. Talk about goals….all these folks want to do is cure cancer and put an end to disease.
In short, they want nothing less than to completely turn the medical field on its head.
The promise of stem cell research
Take the promise that underlies the current goals inherent in stem cell research, for instance.
Dr. Hans Keirstead, a renowned UC Irvine scientist, believes cells culled from a fertilized human egg that can grow into any type of cell in the body are a medical milestone seen only once every 100 years.
Accordingly, Keirstead says, “I have never seen in my career a biological tool as powerful as the stem cell. It addresses every single human disease.” (emphasis mine)
That’s a claim that, if proven true, has the power to create a pre- and post-stem cell world where everything you think about medicine is changed forever.
And while the stem cell industry still has quite a bit of ground to cover to establish itself, the market for these new treatment options is expected to be worth $63.8 billion by 2015, or three times its current size.
Even still, the FDA has been slow to approve new stem cell trials.
As I wrote about in an earlier article, Geron is working on a Phase I trial to cure spinal paralysis, while Advanced Cell Technology recently enrolled the first two patients in a trial using embryonic stem cells to treat macular degeneration, a common cause of vision loss.
Even still, for scientists, prospective patients and investors alike are only in the early stages of what may one day be world changing developments.
The $50 Trillion Windfall
Especially if they can figure out how to cure cancer….
Because prospective patients won’t be the only winners when cancer gets shown the door. The economic impact will be off the charts.
In fact, according to a study presented by the Chicago Graduate School of Business five years ago, a cure for cancer would have an economic value of $50 trillion for Americans alone — about four times the current size of U.S. GDP.
Factor in the rest of the industrialized world, and that figure exceeds $100 trillion.
Even small advancements would have a significant impact. According to the same study, a mere 1 percent reduction in mortality rates from cancer would be worth nearly $500 billion.
Those figures, of course, are just the beginning of the advancements the biotech sector will one day usher in.
That’s why for the last two years I’ve been recommending the SPDR S&P Biotech ETF (NYSE: XBI). Since then, its up over 51%, with plenty more room to the upside.
Another area where early biotech investors with a speculative bent can make some money is in regenerative medicine. It’s the new technology that promises to one day make organ donor lists a thing of the past.
In fact, I’ve have found the one company whose scientists are creating living, functional tissue to repair or replace organ function lost to age, disease, or congenital defects. It is nothing less than science fiction brought to life.
In fact, you can learn more about this cutting edge new company by clicking here. As you will see, to call what they do “revolutionary” doesn’t do it justice.
In the meantime, take solace in today’s troubled markets with the knowledge the next big thing is always where we seem to find it – just around the bend.
Your bargain-hunting analyst,
Editor, Wealth Daily