Biotechnology - political and legal intrigues, viewed by Rothman Research

Politics and legal rulings have major influences on how the biotechnology sector performs. If you consider politics, at times it can have a restrictive influence, similar to when the USA's Bush Administration imposed a ban on government funding for human embryo research, notes new research from South Africa-based Rothman Research.

At other times, it can have a financially adverse effect on the sector as experienced in year 2000, when the biotechnology sector, in two days, lost about $50 billion in market capitalization, following President Clinton's announcement that genome research data should be freely available to every researcher; and sometimes political decisions can seem to be positive as it has been so far, ever since the passing of the health care reform by the Obama administration, the firm points out.

When considering legal rulings, these can sometimes have sweeping consequences on biotech companies, as recently demonstrated with the gene-patent ruling involving Myriad Genetics. "The Myriad gene-patent ruling is viewed as a threat to the overall biotech industry. Some companies, like Amgen, could find themselves caught in the same net," commented Jack Benassi of Rothman Research, adding: "The biotech industry is a volatile market by nature, impending loss of intellectual property could make it even more risky for investors to venture into."