Morgan Stanley Health Sciences Trust N-CSR Certified annual shareholder report (management investment company)

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM N-CSR

                   CERTIFIED SHAREHOLDER REPORT OF REGISTERED
                         MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number: 811-06683

Morgan Stanley Health Sciences Trust
               (Exact name of registrant as specified in charter)

1221 Avenue of the Americas, New York, New York 10020
         (Address of principal executive offices)               (Zip code)

Ronald E. Robison
1221 Avenue of the Americas, New York, New York 10020
                     (Name and address of agent for service)

Registrant's telephone number, including area code: 212-762-4000

Date of fiscal year end: July 31, 2005

Date of reporting period: July 31, 2005


Item 1 - Report to Shareholders

Welcome, Shareholder:

In this report, you'll learn about how your investment in Morgan Stanley Health Sciences Trust performed during the annual period. We will provide an overview of the market conditions, and discuss some of the factors that affected performance during the reporting period. In addition, this report includes the Fund's financial statements and a list of Fund investments.

This material must be preceded or accompanied by a prospectus for the fund being offered.

Market forecasts provided in this report may not necessarily come to pass. There is no assurance that the Fund will achieve its investment objective. The Fund is subject to market risk, which is the possibility that market values of securities owned by the Fund will decline and, therefore, the value of the Fund's shares may be less than what you paid for them. Accordingly, you can lose money investing in this Fund. Please see the prospectus for more complete information on investment risks.

	Fund Report
	For the year ended July 31, 2005

Total Return for the 12 Months Ended July 31, 2005

Class A						Class B						Class C						Class D						S&P 500® Index1						Lipper Health/ Biotechnology Funds Index2
15.02%							14.08	%					14.20	%					15.28	%					14.04	%					20.48	%

The performance of the Fund's four share classes varies because each has different expenses. The Fund's total returns assume the reinvestment of all distributions but do not reflect the deduction of any applicable sales charges. Such costs would lower performance. See Performance Summary for standardized performance and benchmark information.

Market Conditions

As the fiscal year opened, investors were distracted by rising oil prices, the pace of economic growth, inflation, and the intentions of the Federal Reserve (the "Fed"). The prospect of terrorist disruption at the Olympics, the conflict in Iraq and the November U.S. presidential election added to the uneasy climate. However, general market sentiment improved as the months progressed. The Olympics and election passed without major incident, the economy appeared to be on track for moderate growth, and investors seemed to come to terms with the Fed's "measured" rate hikes. Buoyed by these factors, the broad equity market surged in a fourth-quarter rally.

The environment shifted dramatically in early 2005 as investors sought to lock in 2004's gains. As oil prices soared and inflationary pressures loomed, the future outlook for economic growth became cloudier once again. But, as earlier, uncertainty gave way to increased optimism in the final months of the reporting period. Although oil prices remained high and the prospect for additional rate increases appeared likely, encouraging economic data, increased consumer confidence, waning inflationary fears, and many solid corporate earnings announcements boosted the stock market.

Broadly speaking, health sciences stocks outpaced the overall market during the 12- month period ended July 31, 2005, although performance was mixed at the industry and security level. Given the anxiety stemming from macroeconomic and geopolitical factors, many investors were attracted to the health sciences sector for its defensive characteristics. For example, demand for products is steady and future prospects are supported by long-term demographic trends, such as the aging of the population. Also, the market continued to reward many companies which offered breakthrough products backed by favorable research and clinical trial data. However, pockets of the health sciences sector saw more muted performance and at times, considerable volatility. After strong performance in 2004, the biotechnology sector saw a change of fortunes in February of 2005. In the wake of a highly publicized drug recall, market sentiment soured, particularly on smaller companies with less established earnings records. Meanwhile, concerns of patent expirations, waning product pipelines, and legal and regulatory developments weighed on many large-cap pharmaceuticals.

2

Performance Analysis

Morgan Stanley Health Sciences Trust outperformed the S&P 500^® Index and underperformed the Lipper Health/Biotechnology Funds Index for the 12 months ended July 31, 2005, assuming no deduction of applicable sales charges.

Despite the travails of the biotechnology industry, a number of companies were buoyed by favorable clinical trial data. Several biotechnology companies added handsomely to the Fund's overall returns, with strength coming from the larger-cap companies involved in the development of cancer therapies. Managed care providers (HMOs) also were a boon to performance. The Fund benefited from the overall strength in this industry as well as from particularly solid stock selection. Generally, these companies reaped increased profit margins thanks to cost and pricing trends.

In contrast, the Fund's pace was slowed by its exposure to smaller-cap, less established biotechnology companies. As discussed above, a dramatic recall spooked investors on biotechnology; and smaller-cap companies were stung particularly sharply by this shift in sentiment. During the period, we found opportunities to shift the Fund's exposure away from these smaller companies and re-deployed assets into more established biotechnology companies that we believed offered more robust pipelines and earnings growth prospects. Amid concerns about future profitability and an unsettled regulatory and litigation outlook, large-cap pharmaceuticals also detracted from performance. Although the Fund was underweighted in the pharmaceutical industry relative to many of its peers, the exposure that it did include tempered overall gains.

There is no guarantee that any sectors mentioned will continue to perform well or that securities in such sectors will be held by the Fund in the future.

3

TOP 10 HOLDINGS
Amgen Inc.					7.3	%
Celgene Corp.					4.3
Schering-Plough Corp.					4.2
Genzyme Corp.					4.2
Gilead Sciences, Inc.					4.0
UnitedHealth Group Inc.					4.0
Genentech, Inc.					3.6
Eli Lilly & Co.					2.9
Teva Pharmaceutical Industries Ltd. (ADR) (Israel)					2.8
Pfizer, Inc.					2.7

TOP FIVE INDUSTRIES
Biotechnology					42.4	%
Pharmaceuticals: Major					24.8
Medical Specialties					13.8
Managed Health Care					7.7
Pharmaceuticals: Other					3.9

Data as of July 31, 2005. Subject to change daily. All percentages for top 10 holdings and top five industries are as a percentage of net assets. These data are provided for informational purposes only and should not be deemed a recommendation to buy or sell the securities mentioned. Morgan Stanley is a full-service securities firm engaged in securities trading and brokerage activities, investment banking, research and analysis, financing and financial advisory services.

Investment Strategy

The Fund will normally invest at least 80% of its assets in common stocks (including depositary receipts) of health science companies throughout the world. A company will be considered to be a health science company if it derives at least 50% of its earnings or revenues, or it devotes at least 50% of its assets, to health science activities. Health Science companies include, among others:

	1.	hospitals, clinical test laboratories, convalescent and mental health care facilities and home care businesses;

	2.	pharmaceutical companies and companies involved in biotechnology, medical diagnostics, biochemicals and nuclear research and development;

	3.	companies that produce and manufacture medical, dental and optical supplies and equipment;

	4.	companies that provide services to health care companies; and

	5.	HMOs and other health insurance companies.

For More Information About
Portfolio Holdings

Each Morgan Stanley fund provides a complete schedule of portfolio holdings in its semiannual and annual reports within 60 days of the end of the fund's second and fourth fiscal quarters by filing the schedule electronically with the Securities and Exchange Commission (SEC). The semiannual reports are filed on Form N-CSRS and the annual reports are filed on Form

4

N-CSR. Morgan Stanley also delivers the semiannual and annual reports to fund shareholders and makes these reports available on its public Web site, www.morganstanley.com. Each Morgan Stanley fund also files a complete schedule of portfolio holdings with the SEC for the fund's first and third fiscal quarters on Form N-Q. Morgan Stanley does not deliver the reports for the first and third fiscal quarters to shareholders, nor are the reports posted to the Morgan Stanley public Web site. You may, however, obtain the Form N-Q filings (as well as the Form N-CSR and N-CSRS filings) by accessing the SEC's Web site, http://www.sec.gov. You may also review and copy them at the SEC's Public Reference Room in Washington, DC. Information on the operation of the SEC's Public Reference Room may be obtained by calling the SEC at (800) SEC-0330. You can also request copies of these materials, upon payment of a duplicating fee, by electronic request at the SEC's e-mail address (publicinfo@sec.gov) or by writing the Public Reference section of the SEC, Washington, DC 20549-0102.

Proxy Voting Policy and Procedures and Proxy Voting Record

You may obtain a copy of the Fund's Proxy Voting Policy and Procedures without charge, upon request, by calling toll free (800) 869-NEWS or by visiting the Mutual Fund Center on our Web site at www.morganstanley.com. It is also available on the Securities and Exchange Commission's Web site at http://www.sec.gov.

You may obtain information regarding how the Fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 by visiting the Mutual Fund Center on our Web site at www.morganstanley.com. This information is also available on the Securities and Exchange Commission's Web site at http://www.sec.gov.

Householding Notice

To reduce printing and mailing costs, the Fund attempts to eliminate duplicate mailings to the same address. The Fund delivers a single copy of certain shareholder documents, including shareholder reports, prospectuses and proxy materials, to investors with the same last name who reside at the same address. Your participation in this program will continue for an unlimited period of time unless you instruct us otherwise. You can request multiple copies of these documents by calling (800) 350-6414, 8:00 a.m. to 8:00 p.m., ET. Once our Customer Service Center has received your instructions, we will begin sending individual copies for each account within 30 days.

5

	Performance Summary

Performance of $10,000 Investment — Class B

6

Average Annual Total Returns — Period Ended July 31, 2005

						Class A Shares* (since 07/28/97)						Class B Shares** (since 10/30/92)						Class C Shares† (since 07/28/97)						Class D Shares†† (since 07/28/97)
Symbol						HCRAX						HCRBX						HCRCX						HCRDX
1 Year							15.02%	3					14.08%	3					14.20%	3					15.28%	3
							8.98	4					9.08	4					13.20	4					—
5 Years							3.63	3					2.82	3					2.85	3					3.85	3
							2.51	4					2.49	4					2.85	4					—
10 Years							—						11.21	3					—						—
							—						11.21	4					—						—
Since Inception							10.97	3					10.87	3					10.14	3					11.20	3
							10.22	4					10.87	4					10.14	4					—

Performance data quoted represents past performance, which is no guarantee of future results and current performance may be lower or higher than the figures shown. For most recent month-end performance figures, please visit www.morganstanley.com or speak with your Financial Advisor. Investment returns and principal value will fluctuate and fund shares, when redeemed, may be worth more or less than their original cost. The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Performance for Class A, Class B, Class C, and Class D shares will vary due to differences in sales charges and expenses.

* The maximum front-end sales charge for Class A is 5.25%.

** The maximum contingent deferred sales charge (CDSC) for Class B is 5.0%. The CDSC declines to 0% after six years.

† The maximum contingent deferred sales charge for Class C is 1% for shares redeemed within one year of purchase.

†† Class D has no sales charge.

(1) The Standard & Poor's 500 Index (S&P 500^®) is a broad-based index, the performance of which is based on the performance of 500 widely-held common stocks chosen for market size, liquidity and industry group representation. Indexes are unmanaged and their returns do not include any sales charges or fees. Such costs would lower performance. It is not possible to invest directly in an index.

(2) The Lipper Health/Biotechnology Funds Index is an equally weighted performance index of the largest qualifying funds (based on net assets) in the Lipper Health/Biotechnology Funds classification. The Index, which is adjusted for capital gains distributions and income dividends, is unmanaged and should not be considered an investment. There are currently 30 funds represented in this Index.

(3) Figure shown assumes reinvestment of all distributions and does not reflect the deduction of any sales charges.

(4) Figure shown assumes reinvestment of all distributions and the deduction of the maximum applicable sales charge. See the Fund's current prospectus for complete details on fees and sales charges.

‡ Ending value assuming a complete redemption on July 31, 2005.

7

	Expense Example

As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption fees; and (2) ongoing costs, including advisory fees; distribution and service (12b-1) fees; and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period 02/01/05 – 07/31/05.

Actual Expenses

The first line of the table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The second line of the table below provides information about hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing cost of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) and redemption fees. Therefore, the second line of the table is useful in comparing ongoing costs, and will not help you determine the relative total cost of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

				Beginning Account Value				Ending Account Value				Expenses Paid During Period*
				02/01/05				07/31/05				02/01/05 – 07/31/05
Class A
Actual (7.74% return)				$	1,000.00			$	1,077.40			$	8.04
Hypothetical (5% annual return before expenses)				$	1,000.00			$	1,017.06			$	7.80
Class B
Actual (7.27% return)				$	1,000.00			$	1,072.70			$	11.87
Hypothetical (5% annual return before expenses)				$	1,000.00			$	1,013.34			$	11.53
Class C
Actual (7.38% return)				$	1,000.00			$	1,073.80			$	11.26
Hypothetical (5% annual return before expenses)				$	1,000.00			$	1,013.93			$	10.94
Class D
Actual (7.87% return)				$	1,000.00			$	1,078.70			$	6.75
Hypothetical (5% annual return before expenses)				$	1,000.00			$	1,018.30			$	6.56

* Expenses are equal to the Fund's annualized expense ratio of 1.56%, 2.31%, 2.19% and 1.31% respectively, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).

8

Investment Advisory Agreement Approval 

Nature, Extent and Quality of Services

The Board reviewed and considered the nature and extent of the investment advisory services provided by the Investment Adviser under the Advisory Agreement, including portfolio management, investment research and equity and fixed income securities trading. The Board also reviewed and considered the nature and extent of the non-advisory, administrative services provided by the Fund's Administrator under the Administration Agreement, including accounting, clerical, bookkeeping, compliance, business management and planning, and the provision of supplies, office space and utilities. (The Investment Adviser and the Administrator together are referred to as the "Adviser" and the Advisory and Administration Agreements together are referred to as the "Management Agreement.") The Board also compared the nature of the services provided by the Adviser with similar services provided by non-affiliated advisers as reported to the Board by Lipper Inc. ("Lipper").

The Board reviewed and considered the qualifications of the portfolio managers, the senior administrative managers and other key personnel of the Adviser who provide the administrative and investment advisory services to the Fund. The Board determined that the Adviser's portfolio managers and key personnel are well qualified by education and/or training and experience to perform the services in an efficient and professional manner. The Board concluded that the nature and extent of the advisory and administrative services provided were necessary and appropriate for the conduct of the business and investment activities of the Fund. The Board also concluded that the overall quality of the advisory and administrative services was satisfactory.

Performance Relative to Comparable Funds Managed by Other Advisers

The Board reviewed the Fund's performance for the one-, three- and five-year periods ended November 30, 2004, as shown in reports provided by Lipper (the "Lipper Reports"), compared to the performance of comparable funds selected by Lipper (the "performance peer group"), and noted that the Fund's performance was better than its performance peer group average for all three periods. The Board concluded that the Fund's performance was satisfactory.

Fees and Expenses Relative to Comparable Funds Managed by Other Advisers

The Board reviewed the advisory and administrative fees (together, the "management fee") paid by the Fund under the Management Agreement and the total expense ratio of the Fund. The Board noted that: (i) the Fund's management fee rate was slightly higher than the average management fee rate for funds, selected by Lipper (the "expense peer group"), managed by other advisers with investment strategies comparable to those of the Fund, as shown in the Lipper Report for the Fund; but (ii) the Fund's total expense ratio was lower than the average total expense ratio of the funds included in the Fund's expense peer group. The Board concluded that the management fee was competitive in light of the fact that the Adviser managed the Fund so that the total expense ratio of the Fund was less than the total expense ratio of the funds in the expense peer group average.

Breakpoints and Economies of Scale

The Board reviewed the structure of the Fund's management fee schedule under the Management Agreement and noted that it includes breakpoints. The Board also reviewed the level of the Fund's management fee and noted that the fee, as a percentage of the Fund's net assets, would decrease as net assets increase because the management fee includes breakpoints. The Board concluded that the Fund's management fee would reflect economies of scale as assets increase.

9

Profitability of Adviser and Affiliates

The Board considered and reviewed information concerning the costs incurred and profits realized by the Adviser and its affiliates during the last two years from their relationship with the Fund and the Morgan Stanley Fund Complex and reviewed with the Controller of the Adviser the cost allocation methodology used to determine the Adviser's profitability. Based on their review of the information they received, the Board concluded that the profits earned by the Adviser and its affiliates were not excessive in light of the advisory, administrative and other services provided to the Fund.

Fall-Out Benefits

The Board considered so-called "fall-out benefits" derived by the Adviser and its affiliates from their relationship with the Fund and the Morgan Stanley Fund Complex, such as "float" benefits derived from handling of checks for purchases and redemptions of Fund shares through a broker-dealer affiliate of the Adviser and "soft dollar" benefits (discussed in the next section). The Board also considered that a broker-dealer affiliate of the Adviser receives from the Fund 12b-1 fees for distribution and shareholder services. The Board also considered that an affiliate of the Adviser, through a joint venture, receives revenue in connection with trading done on behalf of the Fund through an electronic trading system network ("ECN"). The Board concluded that the float benefits and the above-referenced ECN-related revenue were relatively small and that the 12b-1 fees were competitive with those of other broker-dealer affiliates of investment advisers of mutual funds.

Soft Dollar Benefits

The Board considered whether the Adviser realizes any benefits as a result of brokerage transactions executed through "soft dollar" arrangements. Under such arrangements, brokerage commissions paid by the Fund and/or other funds managed by the Adviser would be used to pay for research that a securities broker obtains from third parties, or to pay for both research and execution services from securities brokers who effect transactions for the Fund. The Adviser informed the Board that it does not use Fund commissions to pay for third party research. It does use commissions to pay for research which is bundled with execution services. The Board recognized that the receipt of such research from brokers may reduce the Adviser's costs but concluded that the receipt of such research strengthens the investment management resources of the Adviser, which may ultimately benefit the Fund and other funds in the Fund Complex.

Adviser Financially Sound and Financially Capable of Meeting the Fund's Needs

The Board considered whether the Adviser is financially sound and has the resources necessary to perform its obligations under the Management Agreement. The Board noted that the Adviser's operations remain profitable, although increased expenses in recent years have reduced the Adviser's profitability. The Board concluded that the Adviser has the financial resources necessary to fulfill its obligations under the Management Agreement.

Historical Relationship Between the Fund and the Adviser

The Board also reviewed and considered the historical relationship between the Fund and the Adviser, including the organizational structure of the Adviser, the policies and procedures formulated and adopted by the Adviser for managing the Fund's operations and the Board's confidence in the competence and integrity of the senior managers and key personnel of the Adviser. The Board concluded that it is beneficial for the Fund to continue its relationship with the Adviser.

10

Other Factors and Current Trends

The Board considered the controls and procedures adopted and implemented by the Adviser and monitored by the Fund's Chief Compliance Officer and concluded that the conduct of business by the Adviser indicates a good faith effort on its part to adhere to high ethical standards in the conduct of the Fund's business.

General Conclusion

After considering and weighing all of the above factors, the Board concluded it would be in the best interest of the Fund and its shareholders to approve renewal of the Management Agreement for another year.

11

Morgan Stanley Health Sciences Trust

Portfolio of Investments July 31, 2005

NUMBER OF SHARES								VALUE
				Common Stocks (95.7%)
				Biotechnology (42.4%)
	817,350			Alnylam Pharmaceuticals, Inc.*				$	7,969,162
	403,590			Amgen Inc.*					32,186,303
	397,500			Celgene Corp.*					19,020,375
	700,800			Encysive Pharmaceuticals, Inc.*					8,907,168
	179,810			Genentech, Inc.*					16,062,427
	173,800			Gen-Probe Inc.*					7,662,842
	246,500			Genzyme Corp.*					18,342,065
	398,000			Gilead Sciences, Inc.*					17,834,380
	252,550			ImClone Systems, Inc.*					8,763,485
	601,800			Incyte Corp.*					4,796,346
	288,500			MedImmune, Inc.*					8,196,285
	220,923			Memory Pharmaceuticals Corp.*					486,031
	229,400			Neurocrine Biosciences, Inc.*					11,373,652
	235,200			OSI Pharmaceuticals Inc.*					9,713,760
	499,100			Protein Design Labs, Inc.*					11,374,489
	247,800			Serono SA (ADR) (Switzerland)					4,177,908
									186,866,678
				Electronic Equipment/Instruments (1.4%)
	204,200			Thermo Electron Corp.*					6,097,412
				Managed Health Care (7.7%)
	177,600			Caremark Rx, Inc.*					7,917,408
	334,128			UnitedHealth Group Inc.					17,474,894
	131,600			WellChoice, Inc.*					8,685,600
									34,077,902
				Medical Specialties (13.8%)
	212,600			Applera Corp. – Applied Biosystems Group					4,426,332
	106,500			Bard (C.R.), Inc.					7,113,135
	248,500			Baxter International, Inc.					9,758,595
	97,400			Dade Behring Holdings Inc.					7,382,920
	161,580			Fisher Scientific International, Inc.*					10,833,939
	166,834			Medtronic, Inc.					8,999,026
	30,000			Nobel Biocare Holding AG (Switzerland)†					6,315,973
	144,500			Varian Medical Systems, Inc.*					5,673,070
									60,502,990
				Pharmaceuticals: Major (24.8%)
	271,050			Bristol-Myers Squibb Co.					6,770,829
	129,300			GlaxoSmithKline PLC (ADR) (United Kingdom)					6,133,992
	127,500			Johnson & Johnson					8,154,900
	224,040			Eli Lilly & Co.					12,617,933
	223,700			Novartis AG (ADR) (Switzerland)					10,896,427
	454,868			Pfizer, Inc.					12,054,002
	50,500			Roche Holding AG (Switzerland)†					6,853,808
	257,700			Sanofi-Aventis (ADR) (France)					11,158,410
	893,600			Schering-Plough Corp.					18,604,752
	96,300			Takeda Pharmaceutical Co., Ltd. (Japan)†					4,923,459
	243,200			Wyeth					11,126,400
									109,294,912
				Pharmaceuticals: Other (3.9%)
	130,400			Forest Laboratories, Inc.*					5,205,568
	386,100			Teva Pharmaceutical Industries Ltd. (ADR) (Israel)					12,123,540
									17,329,108
				Services to the Health Industry (1.7%)
	150,200			Laboratory Corp. of America Holdings*					7,610,634
				Total Common Stocks (Cost $304,971,532)					421,779,636

PRINCIPAL AMOUNT IN THOUSANDS
				Short-Term Investment (4.5%)
				Repurchase Agreement
$	19,944			Joint repurchase agreement account 3.29% due 08/01/05 (dated 07/29/05; proceeds $19,949,468) (a) (Cost $19,944,000)					19,944,000

See Notes to Financial Statements

12

Morgan Stanley Health Sciences Trust

Portfolio of Investments July 31, 2005 continued

								VALUE
Total Investments (Cost $324,915,532) (b)					100.2	%		$	441,723,636
Liabilities in Excess of Other Assets					(0.2	)			(1,089,796	)
Net Assets					100.0	%		$	440,633,840

ADR American Depositary Receipt.

* Non-income producing security.

† Securities with total market value equal to $18,093,240 have been valued at their fair value as determined in good faith under procedures established by and under the general supervision of the Fund's Trustees.

(a) Collateralized by federal agency and U.S. Treasury obligations.

(b) The aggregate cost for federal income tax purposes is $326,562,204. The aggregate gross unrealized appreciation is $117,848,914 and the aggregate gross unrealized depreciation is $2,687,482, resulting in net unrealized appreciation of $115,161,432.

Summary of Investments

INDUSTRY				VALUE				PERCENT OF NET ASSETS
Biotechnology				$186,866,678					42.4	%
Pharmaceuticals: Major				109,294,912					24.8
Medical Specialties				60,502,990					13.8
Managed Health Care				34,077,902					7.7
Repurchase Agreement				19,944,000					4.5
Pharmaceuticals: Other				17,329,108					3.9
Services To The Health Industry				7,610,634					1.7
Electronic Equipment/Instruments				6,097,412					1.4
				$441,723,636					100.2	%

See Notes to Financial Statements

13

Morgan Stanley Health Sciences Trust

Financial Statements

Statement of Assets and Liabilities

July 31, 2005

Assets:
Investments in securities, at value (cost $324,915,532)				$	441,723,636
Receivable for:
Dividends					89,739
Shares of beneficial interest sold					62,219
Foreign withholding taxes reclaimed					50,058
Prepaid expenses and other assets					37,228
Total Assets					441,962,880
Liabilities:
Payable for:
Shares of beneficial interest redeemed					577,207
Investment advisory fee					337,009
Distribution fee					240,778
Administration fee					29,305
Accrued expenses and other payables					144,741
Total Liabilities					1,329,040
Net Assets				$	440,633,840
Composition of Net Assets:
Paid-in-capital				$	306,886,917
Net unrealized appreciation					116,805,566
Accumulated net investment loss					(66,208	)
Accumulated undistributed net realized gain					17,007,565
Net Assets				$	440,633,840
Class A Shares:
Net Assets				$	190,612,356
Shares Outstanding (unlimited authorized, $.01 par value)					10,142,130
Net Asset Value Per Share				$	18.79
Maximum Offering Price Per Share, (net asset value plus 5.54% of net asset value)				$	19.83
Class B Shares:
Net Assets				$	219,875,206
Shares Outstanding (unlimited authorized, $.01 par value)					12,620,848
Net Asset Value Per Share				$	17.42
Class C Shares:
Net Assets				$	20,891,058
Shares Outstanding (unlimited authorized, $.01 par value)					1,197,466
Net Asset Value Per Share				$	17.45
Class D Shares:
Net Assets				$	9,255,220
Shares Outstanding (unlimited authorized, $.01 par value)					482,006
Net Asset Value Per Share				$	19.20

See Notes to Financial Statements

14

Morgan Stanley Health Sciences Trust

Financial Statements continued

Statement of Operations

For the year ended July 31, 2005

Net Investment Loss:
Income
Dividends (net of $80,392 foreign withholding tax)				$	2,681,215
Interest					392,313
Total Income					3,073,528
Expenses
Investment advisory fee					4,434,704
Distribution fee (Class A shares)					151,474
Distribution fee (Class B shares)					3,770,537
Distribution fee (Class C shares)					211,584
Transfer agent fees and expenses					980,927
Administration fee					274,973
Shareholder reports and notices					93,873
Registration fees					68,568
Professional fees					67,189
Custodian fees					32,346
Trustees' fees and expenses					12,845
Other					34,273
Total Expenses					10,133,293
Net Investment Loss					(7,059,765	)
Net Realized and Unrealized Gain (Loss):
Net Realized Gain (Loss) on:
Investments					39,169,174
Foreign exchange transactions					(10,297	)
Net Realized Gain					39,158,877
Net Change in Unrealized Appreciation/Depreciation on:
Investments					30,225,764
Translation of other assets and liabilities denominated in foreign currencies					(3,659	)
Net Appreciation					30,222,105
Net Gain					69,380,982
Net Increase				$	62,321,217

See Notes to Financial Statements

15

Morgan Stanley Health Sciences Trust

Financial Statements continued

Statement of Changes in Net Assets

				FOR THE YEAR ENDED JULY 31, 2005				FOR THE YEAR ENDED JULY 31, 2004
Increase (Decrease) in Net Assets:
Operations:
Net investment loss				$	(7,059,765	)		$	(8,914,982	)
Net realized gain					39,158,877				74,843,308
Net change in unrealized appreciation					30,222,105				(51,797,152	)
Net Increase					62,321,217				14,131,174
Distributions to Shareholders From Net Realized Gain:
Class A shares					(1,395,141	)			—
Class B shares					(42,630,966	)			—
Class C shares					(2,254,240	)			—
Class D shares					(935,164	)			—
Total Distributions					(47,215,511	)			—
Net decrease from transactions in shares of beneficial interest					(82,065,813	)			(71,922,103	)
Net Decrease					(66,960,107	)			(57,790,929	)
Net Assets:
Beginning of period					507,593,947				565,384,876
End of Period (Including accumulated net investment losses of $66,208 and $52,723, respectively)				$	440,633,840			$	507,593,947

See Notes to Financial Statements

16

Morgan Stanley Health Sciences Trust

Notes to Financial Statements July 31, 2005

1.   Organization and Accounting Policies

Morgan Stanley Health Sciences Trust (the "Fund") is registered under the Investment Company Act of 1940, as amended (the "Act"), as a diversified, open-end management investment company. The Fund's investment objective is capital appreciation. The Fund was organized as a Massachusetts business trust on May 26, 1992 and commenced operations on October 30, 1992. On July 28, 1997, the Fund converted to a multiple class share structure.

The Fund offers Class A shares, Class B shares, Class C shares and Class D shares. The four classes are substantially the same except that most Class A shares are subject to a sales charge imposed at the time of purchase and some Class A shares, and most Class B shares and Class C shares are subject to a contingent deferred sales charge imposed on shares redeemed within eighteen months, six years and one year, respectively. Class D shares are not subject to a sales charge. Additionally, Class A shares, Class B shares and Class C shares incur distribution expenses.

Effective August 29, 2005, the Board of Trustees of the Fund approved the implementation of a 2% redemption fee on Class A shares, Class B shares, Class C shares, and Class D shares, which is paid directly to the Fund, for shares redeemed within thirty days of purchase. The redemption fee is designed to protect the Fund and its remaining shareholders from the effects of short-term trading.

The following is a summary of significant accounting policies:

A.   Valuation of Investments — (1) an equity portfolio security listed or traded on the New York Stock Exchange ("NYSE") or American Stock Exchange or other exchange is valued at its latest sale price prior to the time when assets are valued; if there were no sales that day, the security is valued at the mean between the last reported bid and asked price; (2) an equity portfolio security listed or traded on the Nasdaq is valued at the Nasdaq Official Closing Price; if there were no sales that day, the security is valued at the mean between the last reported bid and asked price; (3) all other portfolio securities for which over-the-counter market quotations are readily available are valued at the mean between the last reported bid and asked price. In cases where a security is traded on more than one exchange, the security is valued on the exchange designated as the primary market; (4) for equity securities traded on foreign exchanges, the last reported sale price or the latest bid price may be used if there were no sales on a particular day; (5) when market quotations are not readily available or Morgan Stanley Investment Advisors Inc. (the "Investment Adviser") determines that the latest sale price, the bid price or the mean between the last reported bid and asked price do not reflect a security's market value, portfolio securities are valued at their fair value as determined in good faith under procedures established by and under the general supervision of the Fund's Trustees. Occasionally, developments affecting the closing prices of securities and other assets may occur between the times at which valuations of such securities are determined (that is, close of the foreign market on which the securities trade) and the close of business on the NYSE. If developments occur during such periods that are

17

Morgan Stanley Health Sciences Trust

Notes to Financial Statements July 31, 2005 continued

expected to materially affect the value of such securities, such valuations may be adjusted to reflect the estimated fair value of such securities as of the close of the NYSE, as determined in good faith by the Fund's Trustees or by the Investment Adviser using a pricing service and/or procedures approved by the Trustees of the Fund; (6) certain portfolio securities may be valued by an outside pricing service approved by the Fund's Trustees; and (7) short-term debt securities having a maturity date of more than sixty days at time of purchase are valued on a mark-to-market basis until sixty days prior to maturity and thereafter at amortized cost based on their value on the 61st day. Short-term debt securities having a maturity date of sixty days or less at the time of purchase are valued at amortized cost.

B.   Accounting for Investments — Security transactions are accounted for on the trade date (date the order to buy or sell is executed). Realized gains and losses on security transactions are determined by the identified cost method. Dividend income and other distributions are recorded on the ex-dividend date. Discounts are accreted and premiums are amortized over the life of the respective securities. Interest income is accrued daily.

C.   Repurchase Agreements — Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the Fund, along with other affiliated entities managed by the Investment Adviser, may transfer uninvested cash balances into one or more joint repurchase agreement accounts. These balances are invested in one or more repurchase agreements and are collateralized by cash, U.S. Treasury or federal agency obligations. The Fund may also invest directly with institutions in repurchase agreements. The Fund's custodian receives the collateral, which is marked-to-market daily to determine that the value of the collateral does not decrease below the repurchase price plus accrued interest.

D.   Multiple Class Allocations — Investment income, expenses (other than distribution fees), and realized and unrealized gains and losses are allocated to each class of shares based upon the relative net asset value on the date such items are recognized. Distribution fees are charged directly to the respective class.

E.   Foreign Currency Translation and Forward Foreign Currency Contracts — The books and records of the Fund are maintained in U.S. dollars as follows: (1) the foreign currency market value of investment securities, other assets and liabilities and forward foreign currency contracts ("forward contracts") are translated at the exchange rates prevailing at the end of the period; and (2) purchases, sales, income and expenses are translated at the exchange rates prevailing on the respective dates of such transactions. The resultant exchange gains and losses are recorded as realized and unrealized gain/loss on foreign exchange transactions. Pursuant to U.S. federal income tax regulations, certain foreign exchange gains/losses included in realized and unrealized gain/loss are included in or are a reduction of ordinary income for federal income tax purposes. The Fund does not isolate that portion of the results of operations arising as a result of changes in the foreign exchange rates from the changes in the market prices of the securities. Forward contracts are valued daily at the appropriate exchange rates. The resultant unrealized exchange gains and

18

Morgan Stanley Health Sciences Trust

Notes to Financial Statements July 31, 2005 continued

losses are recorded as unrealized foreign currency gain or loss. The Fund records realized gains or losses on delivery of the currency or at the time the forward contract is extinguished (compensated) by entering into a closing transaction prior to delivery.

F.   Federal Income Tax Policy — It is the Fund's policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Accordingly, no federal income tax provision is required.

G.   Dividends and Distributions to Shareholders — Dividends and distributions to shareholders are recorded on the ex-dividend date.

H.   Use of Estimates — The preparation of financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts and disclosures. Actual results could differ from those estimates.

2.   Investment Advisory/Administration Agreements

Effective November 1, 2004, pursuant to an Investment Advisory Agreement with the Investment Adviser, the Fund pays an advisory fee, accrued daily and payable monthly, by applying the following annual rates to the net assets of the Fund determined at the close of each business day: 0.92% to the portion of the daily net assets not exceeding $500 million; 0.87% to the portion of the daily net assets exceeding $500 million but not exceeding $1 billion; and 0.845% to the portion of the daily net assets in excess of $1 billion.

Effective November 1, 2004, pursuant to an Administration Agreement with Morgan Stanley Services Company Inc. (the "Administrator"), an affiliate of the Investment Adviser, the Fund pays an administration fee, accrued daily and payable monthly, by applying the annual rate of 0.08% to the Fund's daily net assets.

Prior to November 1, 2004, the Fund had retained the Investment Adviser to provide administrative services and to manage the investment of the Fund's assets pursuant to an investment management agreement pursuant to which the Fund paid the Investment Adviser a monthly management fee accrued daily and payable monthly, by applying the following annual rates to the next assets of the Fund determined as of the close of each business day: 1.0% to the portion of the daily net assets not exceeding $500 million; 0.95% to the portion of the daily net assets exceeding $500 million but not exceeding $1 billion; and 0.925% to the portion of the daily net assets in excess of $1 billion.

3.   Plan of Distribution

Shares of the Fund are distributed by Morgan Stanley Distributors Inc. (the "Distributor"), an affiliate of the Investment Adviser and Administrator. The Fund has adopted a Plan of Distribution (the "Plan") pursuant to Rule 12b-1 under the Act. The Plan provides that the Fund will pay the Distributor a fee which is accrued daily and paid monthly at the following annual rates: (i) Class A – up to 0.25% of the average daily net assets of

19

Morgan Stanley Health Sciences Trust

Notes to Financial Statements July 31, 2005 continued

Class A; (ii) Class B – up to 1.0% of the lesser of: (a) the average daily aggregate gross sales of the Class B shares since the inception of the Fund (not including reinvestment of dividend or capital gain distributions) less the average daily aggregate net asset value of the Class B shares redeemed since the Fund's inception upon which a contingent deferred sales charge has been imposed or waived; or (b) the average daily net assets of Class B; and (iii) Class C – up to 1.0% of the average daily net assets of Class C.

In the case of Class B shares, provided that the Plan continues in effect, any cumulative expenses incurred by the Distributor but not yet recovered may be recovered through the payment of future distribution fees from the Fund pursuant to the Plan and contingent deferred sales charges paid by investors upon redemption of Class B shares. Although there is no legal obligation for the Fund to pay expenses incurred in excess of payments made to the Distributor under the Plan and the proceeds of contingent deferred sales charges paid by investors upon redemption of shares, if for any reason the Plan is terminated, the Trustees will consider at that time the manner in which to treat such expenses. The Distributor has advised the Fund that such excess amounts totaled $6,729,868 at July 31, 2005.

In the case of Class A shares and Class C shares, expenses incurred pursuant to the Plan in any calendar year in excess of 0.25% or 1.0% of the average daily net assets of Class A or Class C, respectively, will not be reimbursed by the Fund through payments in any subsequent year, except that expenses representing a gross sales credit to Morgan Stanley Financial Advisors or other selected broker-dealer representatives may be reimbursed in the subsequent calendar year. For the year ended July 31, 2005, the distribution fee was accrued for Class A shares and Class C shares at the annual rate of 0.25% and 0.95%, respectively.

The Distributor has informed the Fund that for the year ended July 31, 2005, it received contingent deferred sales charges from certain redemptions of the Fund's Class A shares, Class B shares and Class C shares of $10 , $717,989 and $6,110 , respectively and received $51,873 in front-end sales charges from sales of the Fund's Class A shares. The respective shareholders pay such charges which are not an expense of the Fund.

4.   Security Transactions and Transactions with Affiliates

The cost of purchases and proceeds from sales of portfolio securities, excluding short-term investments, for the year ended July 31, 2005, aggregated $326,941,737 and $459,340,872, respectively. Included in the aforementioned are purchases with other Morgan Stanley funds of $6,927,210.

At July 31, 2005, Morgan Stanley Fund of Funds – Domestic Portfolio, an affiliate of the Investment Adviser, Administrator and Distributor, held 22,064 Class D shares of beneficial interest of the Fund.

For the year ended July 31, 2005, the Fund incurred brokerage commissions of $103,369 with Morgan Stanley & Co., Inc., an affiliate of the Investment Adviser, Administrator and Distributor, for portfolio transactions executed on behalf of the Fund.

20

Morgan Stanley Health Sciences Trust

Notes to Financial Statements July 31, 2005 continued

Morgan Stanley Trust, an affiliate of the Investment Adviser, Administrator and Distributor, is the
Fund's transfer agent. At July 31, 2005, the Fund had transfer agent fees and expenses payable of approximately $23,200.

The Fund has an unfunded noncontributory defined benefit pension plan covering certain independent Trustees of the Fund who will have served as independent Trustees for at least five years at the time of retirement. Benefits under this plan are based on factors which include years of service and compensation. Aggregate pension costs for the year ended July 31, 2005 included in Trustees' fees and expenses in the Statement of Operations amounted to $6,128. At July 31, 2005, the Fund had an accrued pension liability of $54,571 which is included in accrued expenses in the Statement of Assets and Liabilities. On December 2, 2003, the Trustees voted to close the plan to new participants and eliminate the future benefits growth due to increases to compensation after July 31, 2003.

The Fund has an unfunded Deferred Compensation Plan (the "Compensation Plan") which allows each independent Trustee to defer payment of all, or a portion, of the fees he receives for serving on the Board of Trustees. Each eligible Trustee generally may elect to have the deferred amounts credited with a return equal to the total return on one or more of the Morgan Stanley funds that are offered as investment options under the Compensation Plan. Appreciation/depreciation and distributions received from these investments are recorded with an offsetting increase/decrease in the deferred compensation obligation and do not affect the net asset value of the Fund.

5.   Legal Matters

The Investment Adviser, certain affiliates of the Investment Adviser, certain officers of such affiliates and certain investment companies advised by the Investment Adviser or its affiliates, including the Fund, are named as defendants in a consolidated class action. This consolidated action also names as defendants certain individual Trustees and Directors of the Morgan Stanley funds. The consolidated amended complaint, filed in the United States District Court Southern District of New York on April 16, 2004, generally alleges that defendants, including the Fund, violated their statutory disclosure obligations and fiduciary duties by failing properly to disclose (i) that the Investment Adviser and certain affiliates of the Investment Adviser allegedly offered economic incentives to brokers and others to recommend the funds advised by the Investment Adviser or its affiliates to investors rather than funds managed by other companies, and (ii) that the funds advised by the Investment Adviser or its affiliates, including the Fund, allegedly paid excessive commissions to brokers in return for their efforts to recommend these funds to investors. The complaint seeks, among other things, unspecified compensatory damages, rescissionary damages, fees and costs. The defendants have moved to dismiss the action and intend to otherwise vigorously defend it. On March 10, 2005, Plaintiffs sought leave to supplement their complaint to assert claims on behalf of other investors. While the Fund and Adviser believe that each has meritorious defenses, the ultimate outcome of this matter is not presently determinable at this early stage of the litigation, and no provision has been made in the Fund's financial statements for the effect, if any, of this matter.

21

Morgan Stanley Health Sciences Trust

Notes to Financial Statements July 31, 2005 continued

6. Shares of Beneficial Interest

Transactions in shares of beneficial interest were as follows:

				FOR THE YEAR ENDED JULY 31, 2005								FOR THE YEAR ENDED JULY 31, 2004
				SHARES				AMOUNT				SHARES				AMOUNT
CLASS A SHARES
Sold					209,202			$	3,708,163				371,062			$	6,935,831
Conversion from Class B					10,077,076				172,610,615				—				—
Reinvestment of distributions					71,192				1,303,522				—				—
Redeemed					(1,073,559	)			(19,077,308	)			(208,905	)			(3,865,944	)
Net increase – Class A					9,283,911				158,544,992				162,157				3,069,887
CLASS B SHARES
Sold					870,075				14,612,870				3,153,895				55,233,051
Conversion to Class A					(10,844,345	)			(172,610,615	)			—				—
Reinvestment of distributions					2,280,497				38,882,474				—				—
Redeemed					(6,715,500	)			(112,377,098	)			(6,842,216	)			(118,534,023	)
Net decrease – Class B					(14,409,273	)			(231,492,369	)			(3,688,321	)			(63,300,972	)
CLASS C SHARES
Sold					118,288				1,973,331				384,222				6,848,016
Reinvestment of distributions					126,048				2,150,385				—				—
Redeemed					(480,867	)			(8,066,461	)			(372,070	)			(6,480,629	)
Net increase (decrease) – Class C					(236,531	)			(3,942,745	)			12,152				367,387
CLASS D SHARES
Sold					72,201				1,313,005				422,739				8,225,509
Reinvestment of distributions					23,625				441,087				—				—
Redeemed					(372,618	)			(6,929,783	)			(1,053,040	)			(20,283,914	)
Net decrease – Class D					(276,792	)			(5,175,691	)			(630,301	)			(12,058,405	)
Net decrease in Fund					(5,638,685	)		$	(82,065,813	)			(4,144,313	)		$	(71,922,103	)

7. Federal Income Tax Status

The amount of dividends and distributions from net investment income and net realized capital gains are determined in accordance with federal income tax regulations which may differ from generally accepted accounting principles. These "book/tax" differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature, such amounts are reclassified within the capital accounts based on their federal tax-basis treatment; temporary differences do not require reclassification. Dividends and distributions which exceed net investment income and net realized capital gains for tax purposes are reported as distributions of paid-in-capital.

22

Morgan Stanley Health Sciences Trust

Notes to Financial Statements July 31, 2005 continued

The tax character of distributions paid was as follows:

				FOR THE YEAR ENDED JULY 31, 2005				FOR THE YEAR ENDED JULY 31, 2004
Long-term capital gains				$	47,215,511				—

As of July 31, 2005, the tax-basis components of accumulated earnings were as follows:

Undistributed ordinary income					—
Undistributed long-term gains				$	18,654,247
Net accumulated earnings					18,654,247
Post-October losses					(11,142	)
Temporary differences					(55,076	)
Net unrealized appreciation					115,158,894
Total accumulated earnings				$	133,746,923

As of July 31, 2005, the Fund had temporary book/tax differences primarily attributable to post-October losses (foreign currency losses incurred after October 31 within the taxable year which are deemed to arise on the first business day of the Fund's next taxable year) and capital loss deferrals on wash sales and permanent book/tax differences primarily attributable to a net operating loss. To reflect reclassifications arising from the permanent differences, paid-in-capital was charged $3,941,269, accumulated undistributed net realized gain was charged $3,105,011 and accumulated net investment loss was credited $7,046,280.

8.   Purposes of and Risks Relating to Certain Financial Instruments

The Fund may enter into forward contracts to facilitate settlement of foreign currency denominated
portfolio transactions or to manage foreign currency exposure associated with foreign currency
denominated securities.

Forward contracts involve elements of market risk in excess of the amounts reflected in the Statement of Assets and Liabilities. The Fund bears the risk of an unfavorable change in the foreign exchange rates underlying the forward contracts. Risks may also arise upon entering into these contracts from the potential inability of the counterparties to meet the terms of their contracts.

23

Morgan Stanley Health Sciences Trust

Financial Highlights

Selected ratios and per share data for a share of beneficial interest outstanding throughout each period:

				FOR THE YEAR ENDED JULY 31,
				2005				2004				2003				2002				2001
Class A Shares
Selected Per Share Data:
Net asset value, beginning of period				$	17.88			$	17.37			$	14.88			$	18.14			$	19.81
Income (loss) from investment operations:
Net investment loss‡					(0.16	)			(0.17	)			(0.13	)			(0.15	)			(0.13	)
Net realized and unrealized gain (loss)					2.79				0.68				2.67				(2.87	)			1.04
Total income (loss) from investment operations					2.63				0.51				2.54				(3.02	)			0.91
Less distributions from net realized gain					(1.72	)			—				(0.05	)			(0.24	)			(2.58	)
Net asset value, end of period				$	18.79			$	17.88			$	17.37			$	14.88			$	18.14
Total Return†					15.02	%			2.94	%			17.14	%			(16.88	)%			3.65	%
Ratios to Average Net Assets(1):
Expenses					1.52	%			1.47	%			1.50	%			1.44	%			1.35	%
Net investment loss					(0.87	)%			(0.89	)%			(0.83	)%			(0.88	)%			(0.66	)%
Supplemental Data:
Net assets, end of period, in thousands					$190,612				$15,346				$12,091				$10,354				$12,455
Portfolio turnover rate					72	%			63	%			82	%			84	%			145	%

‡ The per share amounts were computed using an average number of shares outstanding during the period.

† Does not reflect the deduction of sales charge. Calculated based on the net asset value as of the last business day of the period.

(1) Reflects overall Fund ratios for investment income and non-class specific expenses.

See Notes to Financial Statements

24

Morgan Stanley Health Sciences Trust

Financial Highlights continued

				FOR THE YEAR ENDED JULY 31,
				2005				2004				2003				2002				2001
Class B Shares
Selected Per Share Data:
Net asset value, beginning of period				$	16.81			$	16.45			$	14.21			$	17.46			$	19.30
Income (loss) from investment operations:
Net investment loss‡					(0.27	)			(0.29	)			(0.23	)			(0.27	)			(0.27	)
Net realized and unrealized gain (loss)					2.60				0.65				2.52				(2.74	)			1.01
Total income (loss) from investment operations					2.33				0.36				2.29				(3.01	)			0.74
Less distributions from net realized gain					(1.72	)			—				(0.05	)			(0.24	)			(2.58	)
Net asset value, end of period				$	17.42			$	16.81			$	16.45			$	14.21			$	17.46
Total Return†					14.08	%			2.19	%			16.18	%			(17.48	)%			2.81	%
Ratios to Average Net Assets(1):
Expenses					2.27	%			2.23	%			2.26	%			2.20	%			2.16	%
Net investment loss					(1.62	)%			(1.65	)%			(1.59	)%			(1.64	)%			(1.47	)%
Supplemental Data:
Net assets, end of period, in thousands					$219,875				$454,327				$505,403				$510,208				$638,640
Portfolio turnover rate					72	%			63	%			82	%			84	%			145	%

‡ The per share amounts were computed using an average number of shares outstanding during the period.

† Does not reflect the deduction of sales charge. Calculated based on the net asset value as of the last business day of the period.

(1) Reflects overall Fund ratios for investment income and non-class specific expenses.

See Notes to Financial Statements

25

Morgan Stanley Health Sciences Trust

Financial Highlights continued

				FOR THE YEAR ENDED JULY 31,
				2005				2004				2003				2002				2001
Class C Shares
Selected Per Share Data:
Net asset value, beginning of period				$	16.82			$	16.46			$	14.21			$	17.46			$	19.30
Income (loss) from investment operations:
Net investment loss‡					(0.26	)			(0.28	)			(0.23	)			(0.27	)			(0.27	)
Net realized and unrealized gain (loss)					2.61				0.64				2.53				(2.74	)			1.01
Total income (loss) from investment operations					2.35				0.36				2.30				(3.01	)			0.74
Less distributions from net realized gain					(1.72	)			—				(0.05	)			(0.24	)			(2.58	)
Net asset value, end of period				$	17.45			$	16.82			$	16.46			$	14.21			$	17.46
Total Return†					14.20	%			2.19	%			16.09	%			(17.37	)%			2.80	%
Ratios to Average Net Assets(1):
Expenses					2.22	%			2.19	%			2.26	%			2.20	%			2.16	%
Net investment loss					(1.57	)%			(1.61	)%			(1.59	)%			(1.64	)%			(1.47	)%
Supplemental Data:
Net assets, end of period, in thousands					$20,891				$24,117				$23,398				$21,124				$23,178
Portfolio turnover rate					72	%			63	%			82	%			84	%			145	%

‡ The per share amounts were computed using an average number of shares outstanding during the period.

† Does not reflect the deduction of sales charge. Calculated based on the net asset value as of the last business day of the period.

(1) Reflects overall Fund ratios for investment income and non-class specific expenses.

See Notes to Financial Statements

26

Morgan Stanley Health Sciences Trust

Financial Highlights continued

				FOR THE YEAR ENDED JULY 31,
				2005				2004				2003				2002				2001
Class D Shares
Selected Per Share Data:
Net asset value, beginning of period				$	18.19			$	17.63			$	15.07			$	18.32			$	19.96
Income (loss) from investment operations:
Net investment loss‡					(0.11	)			(0.12	)			(0.09	)			(0.11	)			(0.09	)
Net realized and unrealized gain (loss)					2.84				0.68				2.70				(2.90	)			1.03
Total (loss) income from investment operations					2.73				0.56				2.61				(3.01	)			0.94
Less distributions from net realized gain					(1.72	)			—				(0.05	)			(0.24	)			(2.58	)
Net asset value, end of period				$	19.20			$	18.19			$	17.63			$	15.07			$	18.32
Total Return†					15.28	%			3.18	%			17.38	%			(16.66	)%			3.79	%
Ratios to Average Net Assets(1):
Expenses					1.27	%			1.23	%			1.26	%			1.20	%			1.16	%
Net investment loss					(0.62	)%			(0.65	)%			(0.59	)%			(0.64	)%			(0.47	)%
Supplemental Data:
Net assets, end of period, in thousands					$9,255				$13,804				$24,492				$22,058				$14,660
Portfolio turnover rate					72	%			63	%			82	%			84	%			145	%

‡ The per share amounts were computed using an average number of shares outstanding during the period.

† Calculated based on the net asset value as of the last business day of the period.

(1) Reflects overall Fund ratios for investment income and non-class specific expenses.

See Notes to Financial Statements

27

Morgan Stanley Health Sciences Trust

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Trustees of
Morgan Stanley Health Sciences Trust:

We have audited the accompanying statement of assets and liabilities of Morgan Stanley Health Sciences Trust (the "Fund"), including the portfolio of investments, as of July 31, 2005, and the related statements of operations for the year then ended and changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of July 31, 2005, by correspondence with the custodian. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Morgan Stanley Health Sciences Trust as of July 31, 2005, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.

Deloitte & Touche LLP
New York, New York
September 16, 2005

28

Morgan Stanley Health Sciences Trust

Trustee and Officer Information

Independent Trustees:

Name, Age and Address of Independent Trustee

Position(s) Held with Registrant

Term of Office and Length of Time Served*

Principal Occupation(s) During Past 5 Years**

Number of Portfolios in Fund Complex Overseen by Trustee***

Other Directorships Held by Trustee

Michael Bozic (64) c/o Kramer Levin Naftalis & Frankel LLP Counsel to the Independent Trustees 1177 Avenue of the Americas New York, NY 10036

Trustee

Since April 1994

Private Investor; Director or Trustee of the Retail Funds (since April 1994) and the Institutional Funds (since July 2003); formerly Vice Chairman of Kmart Corporation (December 1998-October 2000), Chairman and Chief Executive Officer of Levitz Furniture Corporation (November 1995-November 1998) and President and Chief Executive Officer of Hills Department Stores (May 1991-July 1995); formerly variously Chairman, Chief Executive Officer, President and Chief Operating Officer (1987-1991) of the Sears Merchandise Group of Sears, Roebuck & Co.

197

Director of various business organizations.

Edwin J. Garn (72) 1031 N. Chartwell Court Salt Lake City, UT 84103

Trustee

Since January 1993

Consultant; Director or Trustee of the Retail Funds (since January 1993) and the Institutional Funds (since July 2003); member of the Utah Regional Advisory Board of Pacific Corp. (utility company); formerly Managing Director of Summit Ventures LLC (lobbying and consulting firm) (2000-2004); United States Senator (R-Utah) (1974-1992) and Chairman, Senate Banking Committee (1980-1986), Mayor of Salt Lake City, Utah (1971-1974), Astronaut, Space Shuttle Discovery (April 12-19, 1985), and Vice Chairman, Huntsman Corporation (chemical company).

197

Director of Franklin Covey (time management systems), BMW Bank of North America, Inc. (industrial loan corporation), Escrow Bank USA (industrial loan corporation); United Space Alliance (joint venture between Lockheed Martin and the Boeing Company) and Nuskin Asia Pacific (multilevel marketing); member of the board of various civic and charitable organizations.

Wayne E. Hedien (71) c/o Kramer Levin Naftalis & Frankel LLP Counsel to the Independent Trustees 1177 Avenue of the Americas New York, NY 10036

Trustee

Since September 1997

Retired; Director or Trustee of the Retail Funds; (Since September 1997) and the Institutional Funds (since July 2003); formerly associated with the Allstate Companies (1966-1994), most recently as Chairman of The Allstate Corporation (March 1993-December 1994) and Chairman and Chief Executive Officer of its wholly-owned subsidiary, Allstate Insurance Company (July 1989-December 1994).

197

Director of The PMI Group Inc. (private mortgage insurance); Trustee and Vice Chairman of The Field Museum of Natural History; director of various other business and charitable organizations.

29

Morgan Stanley Health Sciences Trust

Trustee and Officer Information continued

Name, Age and Address of Independent Trustee

Position(s) Held with Registrant

Term of Office and Length of Time Served*

Principal Occupation(s) During Past 5 Years**

Number of Portfolios in Fund Complex Overseen by Trustee***

Other Directorships Held by Trustee

Dr. Manuel H. Johnson (56) c/o Johnson Smick Group, Inc. 888 16th Street, N.W. Suite 740 Washington, D.C. 20006

Trustee

Since July 1991

Senior Partner, Johnson Smick International, Inc., a consulting firm; Chairman of the Audit Committee and Director or Trustee of the Retail Funds (since July 1991) and the Institutional Funds (since July 2003); Co-Chairman and a founder of the Group of Seven Council (G7C), an international economic commission; formerly Vice Chairman of the Board of Governors of the Federal Reserve System and Assistant Secretary of the U.S. Treasury.

197

Director of NVR, Inc. (home construction); Director of KFX Energy; Director of RBS Greenwich Capital Holdings (financial holding company).

Joseph J. Kearns (62) c/o Kearns & Associates LLC PMB754 23852 Pacific Coast Highway Malibu, CA 90265

Trustee

Since July 2003

President, Kearns & Associates LLC (investment consulting); Deputy Chairman of the Audit Committee and Director or Trustee of the Retail Funds (since July 2003) and the Institutional Funds (since August 1994); previously Chairman of the Audit Committee of the Institutional Funds (October 2001-July 2003); formerly CFO of the J. Paul Getty Trust.

198

Director of Electro Rent Corporation (equipment leasing), The Ford Family Foundation, and the UCLA Foundation.

Michael E. Nugent (69) c/o Triumph Capital, L.P. 445 Park Avenue New York, NY 10022

Trustee

Since July 1991

General Partner of Triumph Capital, L.P., a private investment partnership; Chairman of the Insurance Committee and Director or Trustee of the Retail Funds (since July 1991) and the Institutional Funds (since July 2001); formerly Vice President, Bankers Trust Company and BT Capital Corporation (1984-1988).

197

Director of various business organizations.

Fergus Reid (72) c/o Lumelite Plastics Corporation 85 Charles Colman Blvd. Pawling, NY 12564

Trustee

Since July 2003

Chairman of Lumelite Plastics Corporation; Chairman of the Governance Committee and Director or Trustee of the Retail Funds (since July 2003) and the Institutional Funds (since June 1992).

198

Trustee and Director of certain investment companies in the JPMorgan Funds complex managed by J.P. Morgan Investment Management Inc.

30

Morgan Stanley Health Sciences Trust

Trustee and Officer Information continued

Interested Trustees:

Name, Age and Address of Interested Trustee

Position(s) Held with Registrant

Term of Office and Length of Time Served*

Principal Occupation(s) During Past 5 Years**

Number of Portfolios in Fund Complex Overseen by Trustee***

Other Directorships Held by Trustee

Charles A. Fiumefreddo (72) c/o Morgan Stanley Trust Harborside Financial Center, Plaza Two, Jersey City, NJ 07311

Chairman of the Board and Trustee

Since July 1991

Chairman and Director or Trustee of the Retail Funds (since July 1991) and the Institutional Funds (since July 2003); formerly Chief Executive Officer of the Retail Funds (until September 2002).

197

None.

James F. Higgins (57) c/o Morgan Stanley Trust Harborside Financial Center, Plaza Two, Jersey City, NJ 07311

Trustee

Since June 2000

Director or Trustee of the Retail Funds (since June 2000) and the Institutional Funds (since July 2003); Senior Advisor of Morgan Stanley (since August 2000); Director of the Distributor and Dean Witter Realty Inc.; previously President and Chief Operating Officer of the Private Client Group of Morgan Stanley (May 1999-August 2000), and President and Chief Operating Officer of Individual Securities of Morgan Stanley (February 1997-May 1999).

197

Director of AXA Financial, Inc. and The Equitable Life Assurance Society of the United States (financial services).

    * This is the earliest date the Trustee began serving the funds advised by Morgan Stanley Investment Advisors Inc. (the "Investment Adviser") (the "Retail Funds").

  ** The dates referenced below indicating commencement of services as Director/Trustee for the Retail Funds and the funds advised by Morgan Stanley Investment Management Inc. and Morgan Stanley AIP GP LP (the "Institutional Funds") reflect the earliest date the Director/Trustee began serving the Retail or Institutional Funds, as applicable.

*** The Fund Complex includes all open-end and closed-end funds (including all of their portfolios) advised by the Investment Adviser and any funds that have an investment adviser that is an affiliated person of the Investment Adviser (including, but not limited to, Morgan Stanley Investment Management Inc.).

31

Morgan Stanley Health Sciences Trust

Trustee and Officer Information continued

Officers:

Name, Age and Address of Executive Officer

Position(s) Held with Registrant

Term of Office and Length of Time Served*

Principal Occupation(s) During Past 5 Years**

Mitchell M. Merin (51) 1221 Avenue of the Americas New York, NY 10020

President

Since May 1999

President and Chief Operating Officer of Morgan Stanley Investment Management Inc.; President, Director and Chief Executive Officer of the Investment Adviser and the Administrator; Chairman and Director of the Distributor; Chairman and Director of the Transfer Agent; Director of various Morgan Stanley subsidiaries; President of the Institutional Funds (since July 2003) and President of the Retail Funds (since May 1999); Trustee (since July 2003) and President (since December 2002) of the Van Kampen Closed-End Funds; Trustee and President (since October 2002) of the Van Kampen Open-End Funds.

Ronald E. Robison (66) 1221 Avenue of the Americas New York, NY 10020

Executive Vice President and Principal Executive Officer

Since April 2003

Principal Executive Officer of Funds in the Fund Complex (since May 2003); Managing Director of Morgan Stanley & Co. Incorporated, Morgan Stanley Investment Management Inc. and Morgan Stanley; Managing Director, Chief Administrative Officer and Director of the Investment Adviser and the Administrator; Director of the Transfer Agent; Managing Director and Director of the Distributor; Executive Vice President and Principal Executive Officer of the Institutional Funds (since July 2003) and the Retail Funds (since April 2003); Director of Morgan Stanley SICAV (since May 2004); previously, President and Director of the Institutional Funds (March 2001-July 2003) and Chief Global Operations Officer and Managing Director of Morgan Stanley Investment Management Inc.

Joseph J. McAlinden (62) 1221 Avenue of the Americas New York, NY 10020

Vice President

Since July 1995

Managing Director and Chief Investment Officer of the Investment Adviser and Morgan Stanley Investment Management Inc.; Chief Investment Officer of the Van Kampen Funds; Vice President of the Institutional Funds (since July 2003) and the Retail Funds (since July 1995).

Barry Fink (50) 1221 Avenue of the Americas New York, NY 10020

Vice President

Since February 1997

General Counsel (since May 2000) and Managing Director (since December 2000) of Morgan Stanley Investment Management; Managing Director (since December 2000), Secretary (since February 1997) and Director of the Investment Adviser and the Administrator; Vice President of the Retail Funds; Assistant Secretary of Morgan Stanley DW; Vice President of the Institutional Funds (since July 2003); Managing Director, Secretary and Director of the Distributor; previously Secretary (February 1997-July 2003) and General Counsel (February 1997-April 2004) of the Retail Funds; Vice President and Assistant General Counsel of the Investment Adviser and the Administrator (February 1997-December 2001).

Amy R. Doberman (43) 1221 Avenue of Americas New York, NY 10020

Vice President

Since July 2004

Managing Director and General Counsel, U.S. Investment Management; Managing Director of Morgan Stanley Investment Management Inc. and the Investment Adviser, Vice President of the Institutional and Retail Funds (since July 2004); Vice President of the Van Kampen Funds (since August 2004); previously, Managing Director and General Counsel — Americas, UBS Global Asset Management (July 2000 – July 2004) and General Counsel, Aeltus Investment Management Inc. (January 1997 – July 2000).

32

Morgan Stanley Health Sciences Trust

Trustee and Officer Information continued

Name, Age and Address of Executive Officer

Position(s) Held with Registrant

Term of Office and Length of Time Served*

Principal Occupation(s) During Past 5 Years**

Carsten Otto (41) 1221 Avenue of the Americas New York, NY 10020

Chief Compliance Officer

Since October 2004

Executive Director and U.S. Director of Compliance for Morgan Stanley Investment Management (since October 2004); Executive Director of the Investment Adviser and Morgan Stanley Investment Management Inc.; formerly Assistant Secretary and Assistant General Counsel of the Morgan Stanley Retail Funds.

Stefanie V. Chang (38) 1221 Avenue of the Americas New York, NY 10020

Vice President

Since July 2003

Executive Director of Morgan Stanley & Co. Incorporated, Morgan Stanley Investment Management Inc. and the Investment Adviser; Vice President of the Institutional Funds (since December 1997) and the Retail Funds (since July 2003); formerly practiced law with the New York law firm of Rogers & Wells (now Clifford Chance US LLP).

Francis J. Smith (39) c/o Morgan Stanley Trust Harborside Financial Center, Plaza Two, Jersey City, NJ 07311

Treasurer and Chief Financial Officer

Treasurer since July 2003 and Chief Financial Officer since September 2002

Executive Director of the Investment Adviser and the Administrator (since December 2001); previously, Vice President of the Retail Funds (September 2002-July 2003); Vice President of the Investment Adviser and the Administrator (August 2000-November 2001) and Senior Manager at PricewaterhouseCoopers LLP (January 1998-August 2000).

Thomas F. Caloia (59) c/o Morgan Stanley Trust Harborside Financial Center, Plaza Two, Jersey City, NJ 07311

Vice President

Since July 2003

Executive Director (since December 2002) and Assistant Treasurer of the Investment Adviser, the Distributor and the Administrator; previously Treasurer of the Retail Funds (April 1989-July 2003); formerly First Vice President of the Investment Adviser, the Distributor and the Administrator.

Mary E. Mullin (38) 1221 Avenue of the Americas New York, NY 10020

Secretary

Since July 2003

Executive Director of Morgan Stanley & Co. Incorporated, Morgan Stanley Investment Management Inc. and the Investment Adviser; Secretary of the Institutional Funds (since June 1999) and the Retail Funds (since July 2003); formerly practiced law with the New York law firms of McDermott, Will & Emery and Skadden, Arps, Slate, Meagher & Flom LLP.

    * This is the earliest date the Officer began serving the Retail Funds. Each Officer serves an indefinite term, until his or her successor is elected.

  ** The dates referenced below indicating commencement of service as an Officer for the Retail and Institutional Funds reflect the earliest date the Officer began serving the Retail or Institutional Funds, as applicable.

2005 Federal Tax Notice (unaudited)

During the fiscal year ended July 31, 2005, the Fund paid to its shareholders $1.72 per share from long-term capital gains.

33

Trustees Michael Bozic Charles A. Fiumefreddo Edwin J. Garn Wayne E. Hedien James F. Higgins Dr. Manuel H. Johnson Joseph J. Kearns Michael E. Nugent Fergus Reid Officers Charles A. Fiumefreddo Chairman of the Board Mitchell M. Merin President Ronald E. Robison Executive Vice President and Principal Executive Officer Joseph J. McAlinden Vice President Barry Fink Vice President Amy R. Doberman Vice President Carsten Otto Chief Compliance Officer Stefanie V. Chang Vice President Francis J. Smith Treasurer and Chief Financial Officer Thomas F. Caloia Vice President Mary E. Mullin Secretary Transfer Agent Morgan Stanley Trust Harborside Financial Center, Plaza Two Jersey City, New Jersey 07311 Independent Registered Public Accounting Firm Deloitte & Touche LLP Two World Financial Center New York, New York 10281 Investment Adviser Morgan Stanley Investment Advisors Inc. 1221 Avenue of the Americas New York, New York 10020 This report is submitted for the general information of the shareholders of the Fund. For more detailed information about the Fund, its fees and expenses and other pertinent information, please read its Prospectus. The Fund's Statement of Additional Information contains additional information about the Fund, including its trustees. It is available, without charge, by calling (800) 869-NEWS. This report is not authorized for distribution to prospective investors in the Fund unless preceded or accompanied by an effective Prospectus. Read the Prospectus carefully before investing. Investments and services offered through Morgan Stanley DW Inc., member SIPC. Morgan Stanley Distributors Inc., member NASD. © 2005 Morgan Stanley 37956RPT-RA05-00750P-y07/05		MORGAN STANLEY FUNDS
		Morgan Stanley Health Sciences Trust Annual Report July 31, 2005

Item 2.  Code of Ethics.

(a)    The Fund has adopted a code of ethics (the "Code of Ethics") that applies
to its principal executive officer, principal financial officer, principal
accounting officer or controller, or persons performing similar functions,
regardless of whether these individuals are employed by the Fund or a third
party.

(b)    No information need be disclosed pursuant to this paragraph.

(c)    The Fund has amended its Code of Ethics during the period covered by the
shareholder report presented in Item 1 hereto to delete from the end of the
following paragraph on page 2 of the Code the phrase "to the detriment of the
Fund.":

"Each Covered Officer must not use his personal influence or personal
relationship improperly to influence investment decisions or financial reporting
by the Fund whereby the Covered Officer would benefit personally (directly or
indirectly)."

(d)    Not applicable.

(e)    Not applicable.

(f)

       (1)   The Fund's Code of Ethics is attached hereto as Exhibit A.

       (2)   Not applicable.

       (3)   Not applicable.


Item 3.  Audit Committee Financial Expert.

The Fund's Board of Trustees has determined that it has two "audit committee
financial experts" serving on its audit committee, each of whom are
"independent" Trustees: Dr. Manuel H. Johnson and Joseph J. Kearns. Under
applicable securities laws, a person who is determined to be an audit committee
financial expert will not be deemed an "expert" for any purpose, including
without limitation for the purposes of Section 11 of the Securities Act of 1933,
as a result of being designated or identified as an audit committee financial
expert. The designation or identification of a person as an audit committee
financial expert does not impose on such person any duties, obligations, or
liabilities that are greater than the duties, obligations, and liabilities
imposed on such person as a member of the audit committee and Board of Trustees
in the absence of such designation or identification.








Item 4.  Principal Accountant Fees and Services.

(a)(b)(c)(d) and (g). Based on fees billed for the periods shown:




         2005
                                                            REGISTRANT            COVERED ENTITIES(1)

              AUDIT FEES........................            $ 33,836              N/A

              NON-AUDIT FEES
                        AUDIT-RELATED FEES......            $    540 (2)          $ 3,215,745 (2)
                        TAX FEES................            $  4,850 (3)          $    24,000 (4)
                        ALL OTHER FEES..........            $ -                   $ -
              TOTAL NON-AUDIT FEES..............            $  5,390              $ 3,239,745

              TOTAL.............................            $ 39,226              $ 3,239,745





           2004
                                                            REGISTRANT            COVERED ENTITIES(1)

              AUDIT FEES........................            $ 32,344              N/A

              NON-AUDIT FEES
                        AUDIT-RELATED FEES......            $    452 (2)          $ 3,225,276 (2)
                        TAX FEES................            $  4,237 (3)          $   610,053 (4)
                        ALL OTHER FEES..........            $ -                   $ -         (5)
              TOTAL NON-AUDIT FEES..............            $  4,689              $ 3,835,329

              TOTAL.............................            $ 37,033              $ 3,835,329



         N/A- Not applicable, as not required by Item 4.

         (1)   Covered Entities include the Adviser (excluding sub-advisors) and
               any entity controlling, controlled by or under common control
               with the Adviser that provides ongoing services to the
               Registrant.

         (2)   Audit-Related Fees represent assurance and related services
               provided that are reasonably related to the performance of the
               audit of the financial statements of the Covered Entities' and
               funds advised by the Adviser or its affiliates, specifically data
               verification and agreed-upon procedures related to asset
               securitizations and agreed-upon procedures engagements.

         (3)   Tax Fees represent tax compliance, tax planning and tax advice
               services provided in connection with the preparation and review
               of the Registrant's tax returns.

         (4)   Tax Fees represent tax compliance, tax planning and tax advice
               services provided in connection with the review of Covered
               Entities' tax returns.

         (5)   All other fees represent project management for future business
               applications and improving business and operational processes.


                                       2




(e)(1) The audit committee's pre-approval policies and procedures are as
follows:

                                                                      APPENDIX A

                                 AUDIT COMMITTEE
                          AUDIT AND NON-AUDIT SERVICES
                       PRE-APPROVAL POLICY AND PROCEDURES
                                     OF THE
                  MORGAN STANLEY RETAIL AND INSTITUTIONAL FUNDS

                    AS ADOPTED AND AMENDED JULY 23, 2004,(1)


    1. STATEMENT OF PRINCIPLES

The Audit Committee of the Board is required to review and, in its sole
discretion, pre-approve all Covered Services to be provided by the Independent
Auditors to the Fund and Covered Entities in order to assure that services
performed by the Independent Auditors do not impair the auditor's independence
from the Fund.

The SEC has issued rules specifying the types of services that an independent
auditor may not provide to its audit client, as well as the audit committee's
administration of the engagement of the independent auditor. The SEC's rules
establish two different approaches to pre-approving services, which the SEC
considers to be equally valid. Proposed services either: may be pre-approved
without consideration of specific case-by-case services by the Audit Committee
("general pre-approval"); or require the specific pre-approval of the Audit
Committee or its delegate ("specific pre-approval"). The Audit Committee
believes that the combination of these two approaches in this Policy will result
in an effective and efficient procedure to pre-approve services performed by the
Independent Auditors. As set forth in this Policy, unless a type of service has
received general pre-approval, it will require specific pre-approval by the
Audit Committee (or by any member of the Audit Committee to which pre-approval
authority has been delegated) if it is to be provided by the Independent
Auditors. Any proposed services exceeding pre-approved cost levels or budgeted
amounts will also require specific pre-approval by the Audit Committee.

The appendices to this Policy describe the Audit, Audit-related, Tax and All
Other services that have the general pre-approval of the Audit Committee. The
term of any general pre-approval is 12 months from the date of pre-approval,
unless the Audit Committee considers and provides a different period and states
otherwise. The Audit Committee will annually review and pre-approve the services
that may be provided by the Independent Auditors without obtaining specific
pre-approval from the Audit Committee. The Audit Committee will add to or
subtract from the list of general pre-approved services from time to time, based
on subsequent determinations.


- -----------------------------
(1)      This Audit Committee Audit and Non-Audit Services Pre-Approval Policy
         and Procedures (the "Policy"), adopted as of the date above, supersedes
         and replaces all prior versions that may have been adopted from time to
         time.


                                       3






The purpose of this Policy is to set forth the policy and procedures by which
the Audit Committee intends to fulfill its responsibilities. It does not
delegate the Audit Committee's responsibilities to pre-approve services
performed by the Independent Auditors to management.

The Fund's Independent Auditors have reviewed this Policy and believes that
implementation of the Policy will not adversely affect the Independent Auditors'
independence.

    2. DELEGATION

As provided in the Act and the SEC's rules, the Audit Committee may delegate
either type of pre-approval authority to one or more of its members. The member
to whom such authority is delegated must report, for informational purposes
only, any pre-approval decisions to the Audit Committee at its next scheduled
meeting.

    3. AUDIT SERVICES

The annual Audit services engagement terms and fees are subject to the specific
pre-approval of the Audit Committee. Audit services include the annual financial
statement audit and other procedures required to be performed by the Independent
Auditors to be able to form an opinion on the Fund's financial statements. These
other procedures include information systems and procedural reviews and testing
performed in order to understand and place reliance on the systems of internal
control, and consultations relating to the audit. The Audit Committee will
approve, if necessary, any changes in terms, conditions and fees resulting from
changes in audit scope, Fund structure or other items.

In addition to the annual Audit services engagement approved by the Audit
Committee, the Audit Committee may grant general pre-approval to other Audit
services, which are those services that only the Independent Auditors reasonably
can provide. Other Audit services may include statutory audits and services
associated with SEC registration statements (on Forms N-1A, N-2, N-3, N-4,
etc.), periodic reports and other documents filed with the SEC or other
documents issued in connection with securities offerings.

The Audit Committee has pre-approved the Audit services in Appendix B.1. All
other Audit services not listed in Appendix B.1 must be specifically
pre-approved by the Audit Committee (or by any member of the Audit Committee to
which pre-approval has been delegated).

    4. AUDIT-RELATED SERVICES

Audit-related services are assurance and related services that are reasonably
related to the performance of the audit or review of the Fund's financial
statements and, to the extent they are Covered Services, the Covered Entities or
that are traditionally performed by the Independent Auditors. Because the Audit
Committee believes that the provision of Audit-related services does not impair
the independence of the auditor and is consistent with the SEC's rules on
auditor independence, the Audit Committee may grant general pre-approval to
Audit-related services. Audit-related services include, among others, accounting
consultations related to accounting, financial reporting or disclosure matters



                                       4




not classified as "Audit services"; assistance with understanding and
implementing new accounting and financial reporting guidance from rulemaking
authorities; agreed-upon or expanded audit procedures related to accounting
and/or billing records required to respond to or comply with financial,
accounting or regulatory reporting matters; and assistance with internal control
reporting requirements under Forms N-SAR and/or N-CSR.

The Audit Committee has pre-approved the Audit-related services in Appendix B.2.
All other Audit-related services not listed in Appendix B.2 must be specifically
pre-approved by the Audit Committee (or by any member of the Audit Committee to
which pre-approval has been delegated).

    5. TAX SERVICES

The Audit Committee believes that the Independent Auditors can provide Tax
services to the Fund and, to the extent they are Covered Services, the Covered
Entities, such as tax compliance, tax planning and tax advice without impairing
the auditor's independence, and the SEC has stated that the Independent Auditors
may provide such services.

Pursuant to the preceding paragraph, the Audit Committee has pre-approved the
Tax Services in Appendix B.3. All Tax services in Appendix B.3 must be
specifically pre-approved by the Audit Committee (or by any member of the Audit
Committee to which pre-approval has been delegated).

    6. ALL OTHER SERVICES

The Audit Committee believes, based on the SEC's rules prohibiting the
Independent Auditors from providing specific non-audit services, that other
types of non-audit services are permitted. Accordingly, the Audit Committee
believes it may grant general pre-approval to those permissible non-audit
services classified as All Other services that it believes are routine and
recurring services, would not impair the independence of the auditor and are
consistent with the SEC's rules on auditor independence.

The Audit Committee has pre-approved the All Other services in Appendix B.4.
Permissible All Other services not listed in Appendix B.4 must be specifically
pre-approved by the Audit Committee (or by any member of the Audit Committee to
which pre-approval has been delegated).

    7. PRE-APPROVAL FEE LEVELS OR BUDGETED AMOUNTS

Pre-approval fee levels or budgeted amounts for all services to be provided by
the Independent Auditors will be established annually by the Audit Committee.
Any proposed services exceeding these levels or amounts will require specific
pre-approval by the Audit Committee. The Audit Committee is mindful of the
overall relationship of fees for audit and non-audit services in determining
whether to pre-approve any such services.

    8. PROCEDURES

All requests or applications for services to be provided by the Independent
Auditors that do not require specific approval by the Audit Committee will be
submitted to the Fund's Chief Financial Officer and must include a detailed
description of the services to be




                                       5




rendered. The Fund's Chief Financial Officer will determine whether such
services are included within the list of services that have received the general
pre-approval of the Audit Committee. The Audit Committee will be informed on a
timely basis of any such services rendered by the Independent Auditors. Requests
or applications to provide services that require specific approval by the Audit
Committee will be submitted to the Audit Committee by both the Independent
Auditors and the Fund's Chief Financial Officer, and must include a joint
statement as to whether, in their view, the request or application is consistent
with the SEC's rules on auditor independence.

The Audit Committee has designated the Fund's Chief Financial Officer to monitor
the performance of all services provided by the Independent Auditors and to
determine whether such services are in compliance with this Policy. The Fund's
Chief Financial Officer will report to the Audit Committee on a periodic basis
on the results of its monitoring. Both the Fund's Chief Financial Officer and
management will immediately report to the chairman of the Audit Committee any
breach of this Policy that comes to the attention of the Fund's Chief Financial
Officer or any member of management.

    9. ADDITIONAL REQUIREMENTS

The Audit Committee has determined to take additional measures on an annual
basis to meet its responsibility to oversee the work of the Independent Auditors
and to assure the auditor's independence from the Fund, such as reviewing a
formal written statement from the Independent Auditors delineating all
relationships between the Independent Auditors and the Fund, consistent with
Independence Standards Board No. 1, and discussing with the Independent Auditors
its methods and procedures for ensuring independence.

    10. COVERED ENTITIES

Covered Entities include the Fund's investment adviser(s) and any entity
controlling, controlled by or under common control with the Fund's investment
adviser(s) that provides ongoing services to the Fund(s). Beginning with
non-audit service contracts entered into on or after May 6, 2003, the Fund's
audit committee must pre-approve non-audit services provided not only to the
Fund but also to the Covered Entities if the engagements relate directly to the
operations and financial reporting of the Fund. This list of Covered Entities
would include:

        Morgan Stanley Retail Funds
        ---------------------------
        Morgan Stanley Investment Advisors Inc.
        Morgan Stanley & Co. Incorporated
        Morgan Stanley DW Inc.
        Morgan Stanley Investment Management Inc.
        Morgan Stanley Investment Management Limited
        Morgan Stanley Investment Management Private Limited
        Morgan Stanley Asset & Investment Trust Management Co., Limited
        Morgan Stanley Investment Management Company
        Van Kampen Asset Management
        Morgan Stanley Services Company, Inc.
        Morgan Stanley Distributors Inc.
        Morgan Stanley Trust FSB



                                       6




        Morgan Stanley Institutional Funds
        ----------------------------------
        Morgan Stanley Investment Management Inc.
        Morgan Stanley Investment Advisors Inc.
        Morgan Stanley Investment Management Limited
        Morgan Stanley Investment Management Private Limited
        Morgan Stanley Asset & Investment Trust Management Co., Limited
        Morgan Stanley Investment Management Company
        Morgan Stanley & Co. Incorporated
        Morgan Stanley Distribution, Inc.
        Morgan Stanley AIP GP LP
        Morgan Stanley Alternative Investment Partners LP


(e)(2) Beginning with non-audit service contracts entered into on or after May
6, 2003, the audit committee also is required to pre-approve services to Covered
Entities to the extent that the services are determined to have a direct impact
on the operations or financial reporting of the Registrant. 100% of such
services were pre-approved by the audit committee pursuant to the Audit
Committee's pre-approval policies and procedures (attached hereto).

(f) Not applicable.

(g) See table above.

(h) The audit committee of the Board of Trustees has considered whether the
provision of services other than audit services performed by the auditors to the
Registrant and Covered Entities is compatible with maintaining the auditors'
independence in performing audit services.


Item 5. Audit Committee of Listed Registrants.

(a) The Fund has a separately-designated standing audit committee established in
accordance with Section 3(a)(58)(A) of the Exchange Act whose members are:
Michael Bozic, Edwin J. Garn, Wayne E. Hedien, Manual H. Johnson, Joseph J.
Kearns, Michael Nugent and Fergus Reid.

(b) Not applicable.


Item 6. Schedule of Investments

Refer to Item 1.



                                       7




Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.

Applicable only to reports filed by closed-end funds.


Item 8. Portfolio Managers of Closed-End Management Investment Companies

Applicable only to reports filed by closed-end funds.


Item 9. Closed-End Fund Repurchases

Applicable only to reports filed by closed-end funds.


Item 10. Submission of Matters to a Vote of Security Holders

Not applicable.


Item 11. Controls and Procedures

(a) The Fund's principal executive officer and principal financial officer have
concluded that the Fund's disclosure controls and procedures are sufficient to
ensure that information required to be disclosed by the Fund in this Form N-CSR
was recorded, processed, summarized and reported within the time periods
specified in the Securities and Exchange Commission's rules and forms, based
upon such officers' evaluation of these controls and procedures as of a date
within 90 days of the filing date of the report.

(b) There were no changes in the registrant's internal control over financial
reporting that occurred during the registrant's most recent fiscal half-year
(the registrant's second fiscal half-year in the case of an annual report) that
has materially affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.


Item 12. Exhibits

(a) The Code of Ethics for Principal Executive and Senior Financial Officers is
attached hereto.

(b) A separate certification for each principal executive officer and principal
financial officer of the registrant are attached hereto as part of EX-99.CERT.


                                       8




                                   SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934 and
the Investment Company Act of 1940, the registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.

Morgan Stanley Health Sciences Trust

/s/ Ronald E. Robison
Ronald E. Robison
Principal Executive Officer
September 20, 2005

         Pursuant to the requirements of the Securities Exchange Act of 1934 and
the Investment Company Act of 1940, this report has been signed by the following
persons on behalf of the registrant and in the capacities and on the dates
indicated.

/s/ Ronald E. Robison
Ronald E. Robison
Principal Executive Officer
September 20, 2005

/s/ Francis Smith
Francis Smith
Principal Financial Officer
September 20, 2005
















                                       9




                                                                    EXHIBIT 12 A


           CODE OF ETHICS FOR PRINCIPAL EXECUTIVE AND SENIOR FINANCIAL
           -----------------------------------------------------------
                                    OFFICERS
                                    --------
                           ADOPTED SEPTEMBER 28, 2004
                           --------------------------


I.       This Code of Ethics (the "Code") for the investment companies within
         the Morgan Stanley complex identified in Exhibit A (collectively,
         "Funds" and each, a "Fund") applies to each Fund's Principal Executive
         Officer, President, Principal Financial Officer and Treasurer (or
         persons performing similar functions) ("Covered Officers" each of whom
         are set forth in Exhibit B) for the purpose of promoting:

         o     honest and ethical conduct, including the ethical handling of
               actual or apparent conflicts of interest between personal and
               professional relationships.

         o     full, fair, accurate, timely and understandable disclosure in
               reports and documents that a company files with, or submits to,
               the Securities and Exchange Commission ("SEC") and in other
               public communications made by the Fund;

         o     compliance with applicable laws and governmental rules and
               regulations;

         o     prompt internal reporting of violations of the Code to an
               appropriate person or persons identified in the Code; and

         o     accountability for adherence to the Code.

                  Each Covered Officer should adhere to a high standard of
business ethics and should be sensitive to situations that may give rise to
actual as well as apparent conflicts of interest. Any question about the
application of the Code should be referred to the General Counsel or his/her
designee (who is set forth in Exhibit C).

II.      COVERED OFFICERS SHOULD HANDLE ETHICALLY ACTUAL AND APPARENT CONFLICTS
         OF INTEREST

         OVERVIEW. A "conflict of interest" occurs when a Covered Officer's
private interest interferes, or appears to interfere, with the interests of, or
his service to, the Fund. For example, a conflict of interest would arise if a
Covered Officer, or a member of his family, receives improper personal benefits
as a result of his position with the Fund.

         Certain conflicts of interest arise out of the relationships between
Covered Officers and the Fund and already are subject to conflict of interest
provisions in the Investment Company Act of 1940 ("Investment Company Act") and
the Investment




                                       10




Advisers Act of 1940 ("Investment Advisers Act"). For example, Covered Officers
may not individually engage in certain transactions (such as the purchase or
sale of securities or other property) with the Fund because of their status as
"affiliated persons" (as defined in the Investment Company Act) of the Fund. The
Fund's and its investment adviser's compliance programs and procedures are
designed to prevent, or identify and correct, violations of these provisions.
This Code does not, and is not intended to, repeat or replace these programs and
procedures, and such conflicts fall outside the parameters of this Code, unless
or until the General Counsel determines that any violation of such programs and
procedures is also a violation of this Code.

         Although typically not presenting an opportunity for improper personal
benefit, conflicts may arise from, or as a result of, the contractual
relationship between the Fund and its investment adviser of which the Covered
Officers are also officers or employees. As a result, this Code recognizes that
the Covered Officers will, in the normal course of their duties (whether
formally for the Fund or for the investment adviser, or for both), be involved
in establishing policies and implementing decisions that will have different
effects on the Fund and its investment adviser. The participation of the Covered
Officers in such activities is inherent in the contractual relationship between
the Fund and the investment adviser and is consistent with the performance by
the Covered Officers of their duties as officers of the Fund. Thus, if performed
in conformity with the provisions of the Investment Company Act and the
Investment Advisers Act, such activities will be deemed to have been handled
ethically. In addition, it is recognized by the Funds' Boards of
Directors/Trustees ("Boards") that the Covered Officers may also be officers or
employees of one or more other investment companies covered by this or other
codes.

         Other conflicts of interest are covered by the Code, even if such
conflicts of interest are not subject to provisions in the Investment Company
Act and the Investment Advisers Act. The following list provides examples of
conflicts of interest under the Code, but Covered Officers should keep in mind
that these examples are not exhaustive. The overarching principle is that the
personal interest of a Covered Officer should not be placed improperly before
the interest of the Fund.

         Each Covered Officer must not:

         o     use his personal influence or personal relationships improperly
               to influence investment decisions or financial reporting by the
               Fund whereby the Covered Officer would benefit personally
               (directly or indirectly);

         o     cause the Fund to take action, or fail to take action, for the
               individual personal benefit of the Covered Officer rather than
               the benefit of the Fund; or

         o     use material non-public knowledge of portfolio transactions made
               or contemplated for, or actions proposed to be taken by, the Fund
               to trade personally or cause others to trade personally in
               contemplation of the market effect of such transactions.



                                       11




         Each Covered Officer must, at the time of signing this Code, report to
the General Counsel all affiliations or significant business relationships
outside the Morgan Stanley complex and must update the report annually.

         Conflict of interest situations should always be approved by the
General Counsel and communicated to the relevant Fund or Fund's Board. Any
activity or relationship that would present such a conflict for a Covered
Officer would likely also present a conflict for the Covered Officer if an
immediate member of the Covered Officer's family living in the same household
engages in such an activity or has such a relationship. Examples of these
include:

         o     service or significant business relationships as a director on
               the board of any public or private company;

         o     accepting directly or indirectly, anything of value, including
               gifts and gratuities in excess of $100 per year from any person
               or entity with which the Fund has current or prospective business
               dealings, not including occasional meals or tickets for theatre
               or sporting events or other similar entertainment; provided it is
               business-related, reasonable in cost, appropriate as to time and
               place, and not so frequent as to raise any question of
               impropriety;

         o     any ownership interest in, or any consulting or employment
               relationship with, any of the Fund's service providers, other
               than its investment adviser, principal underwriter, or any
               affiliated person thereof; and

         o     a direct or indirect financial interest in commissions,
               transaction charges or spreads paid by the Fund for effecting
               portfolio transactions or for selling or redeeming shares other
               than an interest arising from the Covered Officer's employment,
               such as compensation or equity ownership.

III.     DISCLOSURE AND COMPLIANCE

         o     Each Covered Officer should familiarize himself/herself with the
               disclosure and compliance requirements generally applicable to
               the Funds;

         o     each Covered Officer must not knowingly misrepresent, or cause
               others to misrepresent, facts about the Fund to others, whether
               within or outside the Fund, including to the Fund's
               Directors/Trustees and auditors, or to governmental regulators
               and self-regulatory organizations;

         o     each Covered Officer should, to the extent appropriate within his
               area of responsibility, consult with other officers and employees
               of the Funds and their investment advisers with the goal of
               promoting full, fair, accurate, timely and understandable
               disclosure in the reports and documents the Funds file with, or
               submit to, the SEC and in other public communications made by the
               Funds; and




                                       12




         o     it is the responsibility of each Covered Officer to promote
               compliance with the standards and restrictions imposed by
               applicable laws, rules and regulations.

IV.      REPORTING AND ACCOUNTABILITY

         Each Covered Officer must:

         o     upon adoption of the Code (thereafter as applicable, upon
               becoming a Covered Officer), affirm in writing to the Boards that
               he has received, read and understands the Code;

         o     annually thereafter affirm to the Boards that he has complied
               with the requirements of the Code;

         o     not retaliate against any other Covered Officer, other officer or
               any employee of the Funds or their affiliated persons for reports
               of potential violations that are made in good faith; and

         o     notify the General Counsel promptly if he/she knows or suspects
               of any violation of this Code. Failure to do so is itself a
               violation of this Code.

         The General Counsel is responsible for applying this Code to specific
situations in which questions are presented under it and has the authority to
interpret this Code in any particular situation. However, any waivers(2) sought
by a Covered Officer must be considered by the Board of the relevant Fund or
Funds.

         The Funds will follow these procedures in investigating and enforcing
this Code:

         o     the General Counsel will take all appropriate action to
               investigate any potential violations reported to him;

         o     if, after such investigation, the General Counsel believes that
               no violation has occurred, the General Counsel is not required to
               take any further action;

         o     any matter that the General Counsel believes is a violation will
               be reported to the relevant Fund's Audit Committee;

         o     if the directors/trustees/managing general partners who are not
               "interested persons" as defined by the Investment Company Act
               (the "Independent Directors/Trustees/Managing General Partners")
               of the relevant Fund concur that a violation has occurred, they
               will consider appropriate action, which may include review of,
               and appropriate modifications to, applicable

- -----------------------
(2)      Item 2 of Form N-CSR defines "waiver" as "the approval by the
         registrant of a material departure from a provision of the code of
         ethics."



                                       13




               policies and procedures; notification to appropriate personnel of
               the investment adviser or its board; or a recommendation to
               dismiss the Covered Officer or other appropriate disciplinary
               actions;

         o     the Independent Directors/Trustees/Managing General Partners of
               the relevant Fund will be responsible for granting waivers of
               this Code, as appropriate; and

         o     any changes to or waivers of this Code will, to the extent
               required, be disclosed as provided by SEC rules.

V.       OTHER POLICIES AND PROCEDURES

         This Code shall be the sole code of ethics adopted by the Funds for
purposes of Section 406 of the Sarbanes-Oxley Act of 2002 and the rules and
forms applicable to registered investment companies thereunder. Insofar as other
policies or procedures of the Funds, the Funds' investment advisers, principal
underwriters, or other service providers govern or purport to govern the
behavior or activities of the Covered Officers who are subject to this Code,
they are superseded by this Code to the extent that they overlap or conflict
with the provisions of this Code unless any provision of this Code conflicts
with any applicable federal or state law, in which case the requirements of such
law will govern. The Funds' and their investment advisers' and principal
underwriters' codes of ethics under Rule 17j-1 under the Investment Company Act
and Morgan Stanley's Code of Ethics are separate requirements applying to the
Covered Officers and others, and are not part of this Code.

VI.      AMENDMENTS

         Any amendments to this Code, other than amendments to Exhibits A, B

 or C, must be approved or ratified by a majority vote of the Board of each
Fund, including a majority of Independent Directors/Trustees/Managing General
Partners.

VII.     CONFIDENTIALITY

         All reports and records prepared or maintained pursuant to this Code
will be considered confidential and shall be maintained and protected
accordingly. Except as otherwise required by law or this Code, such matters
shall not be disclosed to anyone other than the Independent
Directors/Trustees/Managing General Partners of the relevant Fund or Funds and
their counsel, the relevant Fund or Funds and their counsel and the relevant
investment adviser and its counsel.



                                       14




VIII.    INTERNAL USE

         The Code is intended solely for the internal use by the Funds and does
not constitute an admission, by or on behalf of any Fund, as to any fact,
circumstance, or legal conclusion



I have read and understand the terms of the above Code. I recognize the
responsibilities and obligations incurred by me as a result of my being subject
to the Code. I hereby agree to abide by the above Code.


- -------------------------

Date:
     --------------------





















                                       15




                                    EXHIBIT B

                               INSTITUTIONAL FUNDS
                                COVERED OFFICERS
                                ----------------

                          Mitchell M. Merin - President
  Ronald E. Robison - Executive Vice President and Principal Executive Officer
            James W. Garrett - Chief Financial Officer and Treasurer

                                  RETAIL FUNDS
                                COVERED OFFICERS
                                ----------------

                          Mitchell M. Merin - President
  Ronald E. Robison - Executive Vice President and Principal Executive Officer
               Frank Smith - Chief Financial Officer and Treasurer




















                                       16





                                    EXHIBIT C
                                    ---------


                                 GENERAL COUNSEL
                                 ---------------


                                   Barry Fink


























                                       17




                                                                   EXHIBIT 12 B1

                  CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

                                 CERTIFICATIONS
                                 --------------

I, Ronald E. Robison, certify that:

1.   I have reviewed this report on Form N-CSR of Morgan Stanley Health Sciences
     Trust;

2.   Based on my knowledge, this report does not contain any untrue statement of
     a material fact or omit to state a material fact necessary to make the
     statements made, in light of the circumstances under which such statements
     were made, not misleading with respect to the period covered by this
     report;

3.   Based on my knowledge, the financial statements and other financial
     information included in this report, fairly present in all material
     respects the financial condition, results of operations, changes in net
     assets, and cash flows (if the financial statements are required to include
     a statement of cash flows) of the registrant as of, and for, the periods
     presented in this report;

4.   The registrant's other certifying officers and I are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Rule 30a-3(c) under the Investment Company Act of 1940) and internal
     control over financial reporting (as defined in Rule 30a-3(d) under the
     Investment Company Act of 1940) for the registrant and have:

a)   designed such disclosure controls and procedures, or caused such disclosure
     controls and procedures to be designed under our supervision, to ensure
     that material information relating to the registrant, including its
     consolidated subsidiaries, is made known to us by others within those
     entities, particularly during the period in which this report is being
     prepared;

b)   designed such internal control over financial reporting, or caused such
     internal control over financial reporting to be designed under our
     supervision, to provide reasonable assurance regarding the reliability of
     financial reporting and the preparation of financial statements for
     external purposes in accordance with generally accepted accounting
     principles;

c)   evaluated the effectiveness of the registrant's disclosure controls and
     procedures and presented in this report our conclusions about the
     effectiveness of the disclosure controls and procedures, as of a date
     within 90 days prior to the filing date of this report based on such
     evaluation; and

d)   disclosed in this report any change in the registrant's internal control
     over financial reporting that occurred during the registrant's most recent
     fiscal half-year (the registrant's second fiscal half-year in the case of
     an annual report) that has materially affected, or is reasonably likely to
     materially affect, the registrant's internal control over financial
     reporting; and

5.   The registrant's other certifying officer(s) and I have disclosed to the
     registrant's auditors and the audit committee of the registrant's board of
     directors (or persons performing the equivalent functions):




                                       18




a)   all significant deficiencies and material weaknesses in the design or
     operation of internal control over financial reporting which are reasonably
     likely to adversely affect the registrant's ability to record, process,
     summarize, and report financial information; and

b)   any fraud, whether or not material, that involves management or other
     employees who have a significant role in the registrant's internal controls
     over financial reporting.


Date: September 20, 2005


                                                /s/ Ronald E. Robison
                                                Ronald E. Robison
                                                Principal Executive Officer


















                                       19


                                                                   EXHIBIT 12 B2

                  CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

                                 CERTIFICATIONS
                                 --------------

I, Francis Smith, certify that:

1.   I have reviewed this report on Form N-CSR of Morgan Stanley Health Sciences
     Trust;

2.   Based on my knowledge, this report does not contain any untrue statement of
     a material fact or omit to state a material fact necessary to make the
     statements made, in light of the circumstances under which such statements
     were made, not misleading with respect to the period covered by this
     report;

3.   Based on my knowledge, the financial statements and other financial
     information included in this report, fairly present in all material
     respects the financial condition, results of operations, changes in net
     assets, and cash flows (if the financial statements are required to include
     a statement of cash flows) of the registrant as of, and for, the periods
     presented in this report;

4.   The registrant's other certifying officers and I are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Rule 30a-3(c) under the Investment Company Act of 1940) and internal
     control over financial reporting (as defined in Rule 30a-3(d) under the
     Investment Company Act of 1940) for the registrant and have:

a)   designed such disclosure controls and procedures, or caused such disclosure
     controls and procedures to be designed under our supervision, to ensure
     that material information relating to the registrant, including its
     consolidated subsidiaries, is made known to us by others within those
     entities, particularly during the period in which this report is being
     prepared;

b)   designed such internal control over financial reporting, or caused such
     internal control over financial reporting to be designed under our
     supervision, to provide reasonable assurance regarding the reliability of
     financial reporting and the preparation of financial statements for
     external purposes in accordance with generally accepted accounting
     principles;

c)   evaluated the effectiveness of the registrant's disclosure controls and
     procedures and presented in this report our conclusions about the
     effectiveness of the disclosure controls and procedures, as of a date
     within 90 days prior to the filing date of this report based on such
     evaluation; and

d)   disclosed in this report any change in the registrant's internal control
     over financial reporting that occurred during the registrant's most recent
     fiscal half-year (the registrant's second fiscal half-year in the case of
     an annual report) that has materially affected, or is reasonably likely to
     materially affect, the registrant's internal control over financial
     reporting; and

5.   The registrant's other certifying officer(s) and I have disclosed to the
     registrant's auditors and the audit committee of the registrant's board of
     directors (or persons performing the equivalent functions):




                                       20




a)   all significant deficiencies and material weaknesses in the design or
     operation of internal control over financial reporting which are reasonably
     likely to adversely affect the registrant's ability to record, process,
     summarize, and report financial information; and

b)   any fraud, whether or not material, that involves management or other
     employees who have a significant role in the registrant's internal controls
     over financial reporting.


Date: September 20, 2005

                                                /s/ Francis Smith
                                                Francis Smith
                                                Principal Financial  Officer























                                       21




                            SECTION 906 CERTIFICATION

                Certification Pursuant to 18 U.S.C. Section 1350,
                             As Adopted Pursuant to
                  Section 906 of the Sarbanes-Oxley Act of 2002


Morgan Stanley Health Sciences Trust

         In connection with the Report on Form N-CSR (the "Report") of the
above-named issuer for the period ended July 31, 2005 that is accompanied by
this certification, the undersigned hereby certifies that:

1.   The Report fully complies with the requirements of Section 13(a) or 15(d)
     of the Securities Exchange Act of 1934; and

2.   The information contained in the Report fairly presents, in all material
     respects, the financial condition and results of operations of the Issuer.



Date: September 20, 2005                         /s/ Ronald E. Robison
                                                 ---------------------------
                                                 Ronald E. Robison
                                                 Principal Executive Officer



A signed original of this written statement required by Section 906 has been
provided to Morgan Stanley Health Sciences Trust and will be retained by Morgan
Stanley Health Sciences Trust and furnished to the Securities and Exchange
Commission or its staff upon request.

















                                       22



                            SECTION 906 CERTIFICATION

                Certification Pursuant to 18 U.S.C. Section 1350,
                             As Adopted Pursuant to
                  Section 906 of the Sarbanes-Oxley Act of 2002


Morgan Stanley Health Sciences Trust

         In connection with the Report on Form N-CSR (the "Report") of the
above-named issuer for the period ended July 31, 2005 that is accompanied by
this certification, the undersigned hereby certifies that:

1.   The Report fully complies with the requirements of Section 13(a) or 15(d)
     of the Securities Exchange Act of 1934; and

2.   The information contained in the Report fairly presents, in all material
     respects, the financial condition and results of operations of the Issuer.



Date: September 20, 2005                        /s/ Francis Smith
                                                ----------------------
                                                Francis Smith
                                                Principal Financial Officer



A signed original of this written statement required by Section 906 has been
provided to Morgan Stanley Health Sciences Trust and will be retained by Morgan
Stanley Health Sciences Trust and furnished to the Securities and Exchange
Commission or its staff upon request.







                                       23