NEW YORK (CNN/Money) - The biotechnology sector continued to lose money last year, even as its sales increased, according to a report released Wednesday by the accounting firm Ernst & Young.

Nonetheless, the U.S. portion of the biotech industry is expected to turn a profit within four years, said Michael Hildreth, director of America's biotech practice at Ernst & Young.

"We're thinking that the U.S. industry, which is the most advanced, will be profitable by the end of the decade, as early as 2009," said Hildreth. Hildreth said the projected increase in U.S. profits will be "driven by new products entering the market, and other products maturing."

The biotechnology sector's revenue grew 17 percent in 2004 to $54.6 billion worldwide, according to the report. The industry suffered a net loss of $5.3 billion in 2004, outpacing its 2003 loss of $4.6 billion, the report said. Also, research and development costs totaled $20.9 billion worldwide last year, the report said.

The United States accounted for 78 percent of biotech revenues, Ernst & Young said. U.S. revenue for the biotech industry totaled $42.7 billion in 2004, with a net loss of $4.3 billion. Research and development costs among American companies totaled $15.7 billion.

"I see [U.S. biotech revenues] growing to right about $100 billion at the end of the decade, and it's really at that level that the industry should be profitable," said Hildreth. Out of 330 publicly traded biotechs in the U.S., 67 are currently profitable, he added.

Hildreth said he expects research and development costs to increase, but not as rapidly as the increase in product sales.

"I think we're really at the start of a wave of strong product introduction over the next decade or so," said Hildreth. "Lots of sick people will benefit from receiving treatment for diseases that have been, up to now, untreatable."

Europe's biotech sector trails the U.S. by about 10 years, said Hildreth. European biotech revenues totaled $7.7 billion in 2004, with a net loss of $484 million and research and development costs totaling $4.2 billion.

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