MSCI is launching a set of indices that target megatrends and innovation in the biotechnology and pharmaceutical industries.
The partnership with Nasdaq-listed Royalty Pharma will measure the performance of companies focused on delivering new and innovative therapeutic treatments related to virology and oncology.
Royalty Pharma, which is in the business of acquiring pharmaceutical royalties in the life sciences industry, will provide information on medical conditions, clinical trials, therapies and technologies that may lead to breakthrough medical treatments.
The series is the latest addition to MSCI's growing portfolio of thematic indices.
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It launched the MSCI Climate Paris Aligned Index Suite in October 2020, eight new indices that capture climate data from its Climate Value-at-Risk (Climate VaR) tool, scope 3 emissions (indirect greenhouse gas emissions generated from sources not owned or controlled by a reporting entity) data and green revenue.
The index provider said: "Thematic investing is not a sector, factor or ESG strategy; nor is it bound by conventional geographic or industry classifications, such as style or market capitalisation. Rather, it is an investment approach that takes a long-term view of how trends can change prevailing business models and value chains while facilitating investor access and exposure to growth themes of the future."
MSCI chair and chief executive Henry Fernandez said since COVID-19, life sciences companies have been pivotal to shaping and advancing the healthcare industry and are critical to developing approaches for preventing and treating diseases.
Royalty Pharma founder and chief executive Pablo Legorreta said: "This collaboration leverages Royalty Pharma's deep clinical and scientific knowledge built over decades, as well as the unique capabilities of our Strategy and Analytics team. This venture represents another example of Royalty Pharma's creative approach to monetising its existing intellectual capital through the creation of indexes that support investment in life sciences."