Healthcare ETFs to Gain on $65-Billion Pandemic Protection Plan
The Biden administration recently offered a $65 billion plan that U.S. officials say is aimed at combating the biological threats after the COVID-19 p...
The Biden administration recently offered a $65 billion plan that U.S. officials say is aimed at combating the biological threats after the COVID-19 pandemic goes away. The next pandemic will likely be “substantially different” than Covid, and so the U.S. government has started preparing to deal with any future viral threat, said Eric Lander, President Joe Biden’s science advisor and director of the Office of Science and Technology, as quoted on CNBC.
An investment of $65 billion is “modest” if we compare with the fact that the current pandemic has cost the United States an estimated $16 trillion in lost economic output. It’s also smaller than what the nation allocates for other programs, such as missile defense and anti-terrorism, which cost U.S. taxpayers $20 billion and $170 billion a year, respectively, they said, per the CNBC article.
“If major pandemics similar to COVID-19, costing the U.S. roughly $16 trillion, occur at a frequency of every 20 years, the annualized economic impact on the U.S. would be $800 billion per year. Even for somewhat milder pandemics, the annualized cost would likely exceed $500 billion,” officials wrote in the document, CNBC noted.
We would like to note that no matter whether the allocation of the fund is huge or not, the Biden administration’s latest plan would help healthcare and pharma stocks and ETFs.
Healthcare Spending in Focus
The United States would spend a total of $24.2 billion to develop and test new vaccines for a range of viruses and make improvements to vaccine distribution and manufacturing. The plan also calls for spending $11.8 billion on therapeutics, which would permit U.S. scientists and drugmakers develop new antivirals and other drugs and ensure large-scale manufacturing capacity for monoclonal antibody treatments. About $3.1 billion has been assigned to helping the development of next-generation PPE.
Against this backdrop, below we highlight a few healthcare ETFs that should be gainful amid these circumstances.
Franklin Genomic Advancements ETF HELX
The Franklin Genomic Advancements ETF seeks capital appreciation by investing in innovative companies related to genomic-based technologies designed to enhance the quality of life. Moderna, Intellia and Biontech are the top three stocks of the fund.
ETFMG Treatments Testing and Advancements ETF GERM
The Prime Treatments, Testing and Advancements Index provides investors with a reference measure that enables them to track both event-driven news and long-term trends of companies engaged in developing treatments and vaccines, or diagnostic technology, in the fight against infectious diseases. Moderna, Biontech and Bio Rad Labs are the top three stocks of the fund.
iShares U.S. Pharmaceuticals ETF IHE
The underlying Dow Jones U.S. Select Pharmaceuticals Index is free-float adjusted market capitalization-weighted index. It includes pharmaceutical companies such as manufacturers of prescription or over-the-counter drugs or vaccines, but excludes producers of vitamins. Johnson & Johnson, Pfizer and Catalent are top three stocks of the fund.
Pacer BioThreat Strategy ETF VIRS
The underlying LifeSci BioThreat Strategy Index comprises of U.S. listed stocks of companies whose products or services help protect against, endure, or recover from biological threats to human health. Danaher, Nvidia and Thermo fisher scientific are top three stocks of the fund.
SPDR S&P Health Care Equipment ETF XHE
The underlying S&P Health Care Equipment Select Industry Index represents the health care equipment segment of the S&P Total Market Index. BioLife Solutions, Silk Road Medical and ResMed are the top three stocks of the fund.
Global X Genomics & Biotechnology ETF GNOM
The underlying Solactive Genomics Index tracks the companies that generate revenues from gene editing, genomic sequencing, development and testing of genetic medicine/therapies, computational genomics and genetic diagnostics, and biotechnology. Intellia Therapeutics, Alnylam Pharmaceuticals and Agilent Technologies are the top three stocks of the fund.
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iShares U.S. Pharmaceuticals ETF (IHE): ETF Research Reports
SPDR S&P Health Care Equipment ETF (XHE): ETF Research Reports
Global X Genomics & Biotechnology ETF (GNOM): ETF Research Reports
Franklin Genomic Advancements ETF (HELX): ETF Research Reports
ETFMG Treatments, Testing and Advancements ETF (GERM): ETF Research Reports
Pacer BioThreat Strategy ETF (VIRS): ETF Research Reports
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