Microalgal cells serve as solar-powered factories that produce pharmaceuticals, recombinant proteins (vaccines and drugs), and valuable natural byproducts that possess medicinal properties. The main advantages of microalgae as cell factories can be summarized as follows: they are fueled by photosynthesis, are carbon dioxide-neutral, have rapid growth rates, are robust, have low-cost cultivation, are easily scalable, pose no risk of human pathogenic contamination, and their valuable natural byproducts can be further processed. Despite their potential, there are many technical hurdles that need to be overcome before the commercial production of microalgal pharmaceuticals, and extensive studies regarding their impact on human health must still be conducted and the results evaluated. Clearly, much work remains to be done before microalgae can be used in the large-scale commercial production of pharmaceuticals. This review focuses on recent advancements in microalgal biotechnology and its future perspectives.