We have seen very strong M&A activity in the biotech space this year and the trend is expected to continue as big pharmaceutical companies are trying to gain an edge in the increasingly competitive cancer treatment market. Last week, Pfizer (PFE) announced that it would buy cancer drug maker Array BioPharma (ARRY) for about $11 billion. Pharmaceutical giant Bristol-Myers (BMY) is acquiring rival Celgene (CELG) for $74 billion, which however may be delayed due to FTC’s anticompetitive concerns about the merger.Merck (MRK) is acquiring cancer drug developer Peloton Therapeutics for $1.05 billion. The announcement came as Peloton was preparing for its IPO. Earlier this year, Eli Lilly (LLY) bought Loxo Oncology for $8 billion.ETFs that focus on smaller biotech companies are outperforming the broader, market-cap weighted biotech ETFs this year.Investors should however remember that small biotech companies can be quite volatile. Further, many companies have products in clinical trials where chances of failure are high so these should be seen as high-risk, high-growth potential investments.The ARK Genomic Revolution Multi-Sector ETF (ARKG) is an actively managed ETF that focuses on companies involved in the genomics industry. The product is up more than 36% this year. Its top holdings include Illumina (ILMN) and Invitae (NVTA).The ALPS Medical Breakthroughs ETF (SBIO) holds mid cap and small cap biotech companies with one or more drugs in Phase II or III of FDA clinical trials. FibroGen (FGEN) and ACADIA Pharmaceuticals (ACAD) are its top holdings. The fund has gained about 28% in 2019.The Principal Healthcare Innovators Index ETF (BTEC) invests in mid cap and small cap healthcare companies developing innovative medicines, therapies, equipment, and facilities. It is up more than 22% year-to-date.To learn more about these ETFs, please watch the short video above,Want key ETF info delivered straight to your inbox?Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Invitae Corporation (NVTA): Free Stock Analysis Report Pfizer Inc. (PFE): Free Stock Analysis Report Merck & Co., Inc. (MRK): Free Stock Analysis Report Eli Lilly and Company (LLY): Free Stock Analysis Report Bristol-Myers Squibb Company (BMY): Free Stock Analysis Report Principal Healthcare Innovators Index ETF (BTEC): ETF Research Reports ALPS Medical Breakthroughs ETF (SBIO): ETF Research Reports Illumina, Inc. (ILMN): Free Stock Analysis Report Array BioPharma Inc. (ARRY): Free Stock Analysis Report Celgene Corporation (CELG): Free Stock Analysis Report ARK Genomic Revolution ETF (ARKG): ETF Research Reports To read this article on Zacks.com click here. Zacks Investment Research Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report