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Franklin Templeton

June 1, 2026

How Innovation is Transforming Biotechnology

Sector ReportEquitiesOtherHealth Care

Biotechnology is entering a multi-year innovation cycle driven by five key trends: scalable gene therapies, multi-purpose drugs, efficient regulatory pathways, AI-driven discovery, and precise drug delivery. These advancements are increasing R&D productivity and expanding addressable markets, making the sector an attractive compounding asset class.

Key Takeaways

  • 1.Cell and gene therapies are moving toward scalable commercialization, expanding from rare diseases to broader use cases through improved manufacturing.
  • 2.The expansion of multi-purpose drugs, such as GLP-1 therapies, is driving diversified revenue growth and extending product lifecycles.
  • 3.Higher approval rates and more efficient regulatory pathways are shortening the time from trial to market, enhancing capital efficiency.

Table of Contents

  • 1 | Broader access to cell and gene therapies as they move toward the mainstream
  • 2 | More compounds approved for a wider scope of treatments
  • 3 | Higher approval rates and more efficient regulatory pathways
  • 4 | AI-originated and designed molecules
  • 5 | Improved drug delivery mechanisms
  • The bottom line
  • Glossary
  • WHAT ARE THE RISKS?
  • IMPORTANT LEGAL INFORMATION

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Authors

Evan McCullochAkiva Felt

Securities

GLP-1 therapiesmRNA

Themes

AI in Drug DiscoveryScalability of Cell and Gene TherapyPrecision Drug Delivery

Regions

Global