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I initiate Buy ratings on SPDR S&P Biotech ETF and iShares Biotechnology ETF for 2026–2027, favoring XBI for higher upside. Biotech's rally reflects improving fundamentals: robust M&A, positive clinical data, improved financing, and more quantifiable policy risk, not indiscriminate multiple expansion. MFN drug-pricing risk is narrower than feared, with emerging policies fragmented by payer, product, geography, and voluntary manufacturer participation.
With well over 170 ETFs on the market covering diverse investment strategies, State Street offers a prime window into which funds — and market trends — are leading the pack in the near term. Key Takeaways: Across State Street's 170+ ETFs, the top five performers this past month are all tied to the healthcare industry.
Invesco Pharmaceuticals ETF offers a higher dividend yield and lower five-year beta than State Street SPDR S&P Biotech ETF State Street SPDR S&P Biotech ETF holds 155 securities compared to 30 in Invesco Pharmaceuticals ETF Invesco Pharmaceuticals ETF has experienced a significantly smaller max drawdown of 17.5% over the last five years, compared to 54% for State Street SPDR S&P Biotech ETF
Biotechnology stocks like Illumina, Eli Lilly and Exelixis have quietly turned into the new market leaders.
Biotech is having a moment, and the numbers are hard to ignore. The SPDR S&P Biotech ETF (NYSEARCA:XBI) climbed 17.27% over the trailing month ending July 1, 2026, a run that would look right at home in the AI trade.
June has been a month full of excitement in the ETF market. While commercial space and AI infrastructure attracted a significant amount of investor attention, biotechnology exposure comprises four out of the five top-performing equity ETFs as of June 29.
Big pharma's patent cliff risk is somewhat overstated, as layered IP and litigation often extend exclusivity beyond headline expiries. Incremental innovation—new formulations, improved delivery, and higher dosing—effectively extends product lifecycles and drives shareholder value.
LLY, ABBV, BIIB and JNJ hit new 52-week highs as biotech rallies, with company-specific pipeline, approvals and deal activity adding momentum.