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Biotech has been stuck in the mud for four years.
And no wonder…
As investors have become infatuated with technology, specifically the wonders of AI and Space, the pharma and biotech sector have been overlooked.
Grossly overlooked.
From 2022 through 2025, while mostly everything else traded higher, the entire pharma and biotech sector sat in a bear market.
Case in point…
From 2022 to 2025, the State Street SPDR S&P Biotech ETF (XBI) has been dead money, trading in a frustrating range between $70 and $100 without any signs of a breakout.
But now, as you can see from the chart below, that could be ready to change…
Triggered by 33 biotech buyouts worth $500 million or more, with three deals in June and July exceeding $10 billion, the XBI has quietly gained +26% in 2026.
It’s now moved above levels not seen since 2021.
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While tech valuations get stretched and the AI and Space themed trades get crowded, investors may return to biotech as Wall Street’s next growth opportunity.
Don’t miss it.
Late-stage readouts from clinical trials for drugs to treat cancer and heart disease are coming later this year. Merck, Novartis, Bristol Myers Squibb, Moderna, and Summit Therapeutics all have big trial news that could break at any moment.
A positive readout from any of them gives the money coming out of crowded tech somewhere specific to go, which makes XBI a trade to consider at current levels.
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