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Why does the biotechnology industry have such a high PE ratio?
Most biotech companies do not have a product they are selling.   They have a set of possible drugs that they are developing.     If any of these drugs get proven to be better than the current drugs they can be sold at a great profit. Therefore as soon as a biotech company proves a drug candidate is likely to pass large scale trials the company is often taken over by a large pharmaceutical company and is therefore no longer listed on the stock market. So mostly profit comes after the company stops being listed, therefore the profit will be negative for most biotech companies that are publicly traded.