Increase in Biotech Start-Ups Fuels Demand for P R A Health's Services

Innovative biotechnology companies want to focus on their research and many are outsourcing the administrative side to P R A Healthcare.
By Mary Ellen McGonagle ,

How do you invest in the rise in biotech start-ups without the risk associated with such ventures? There is a way.

Year to date, over 161 companies have been brought public and 45% of them have been in the health-care Sector. 

With all of the advances being made in bio-technology as well as with medical products, it's easy to see why such a large percentage of newly public companies would be in this sector. Many healthcare companies need to raise capital in order to conduct lengthy trials and have their products approved; particularly within the biotechnology industry which accounted for two-thirds of healthcare IPOs.

Since many recently launched biotech companies take years before they turn a profit, investing in them before they are more mature and into late-stage approval phase can be risky. There is however one way that you can play this rise in biotech start-ups and still sleep at night.

Take a look at medical research services provider P R A Health (PRAH) - Get Report . This North Carolina-based company provides outsourced clinical development services to the biotechnology and pharmaceutical industries. Helping with everything from product registration to clinical trial strategizing, the company works with clients throughout phase trial periods.

Earlier this month, the company reported third-quarter earnings that were almost double this same quarter last year. Also, its two-year sales growth rate is a blistering 225% and investors are taking notice. Public for only 12 months, the company has more than doubled from its IPO price of $18.00. 

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This article is commentary by Mary Ellen McGonagle, President MEM Investment Research - an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

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