Prescription drugs are big business: almost 50% of people regularly take prescription medication in the US alone, and almost 20% take over five types of them. The world, it seems, is addicted to – entirely legal – pills.

And the pharmaceutical industry is addicted to keeping it that way. With global sales of over $1.2 trillion, companies involved in researching, manufacturing, and distributing drugs can make a very healthy profit. And so can their investors: pharma firms have delivered a 280% return since the US pharmaceutical index was established in 2006, compared to 247% for the wider market. Assuming the population keeps aging in the way it’s expected to, the forecast market growth of 5% a year is likely to boost stocks much more.

But investing in pharma offers more than just returns from rising stock prices: big firms like Johnson & Johnson, Merck, and Pfizer are known for the hefty dividend payments they regularly hand out. Some investors favor the industry’s non-cyclical nature too: its stocks, in other words, tend to be resilient even when the economy is going down, making them a good way to balance a portfolio.

Of course, investing in pharmaceuticals isn’t without its risks, so in this Pack, we’ll help you deal in drugs responsibly by making sure you’re fully aware of any potential side effects. With a bit of luck, you’ll be able to get those market highs you’re after without letting your portfolio get hooked on just one sector…

The takeaway: The $1.2 trillion pharma industry is a good way to add resilience to your portfolio, but investing in it can be risky and complicated.