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Best biotech stocks to buy in 2021
Our financial analysts have picked out the top five biotech companies that are at the top of their field. Additionally, you can find an explanation of the industry as a whole, along with the best place to find these biotech stocks.
What are the top biotech stocks to buy?
The table below contains the five companies our experts have chosen. You can either find their up to date share price through the table, or scroll down to find out more information about each.
|#||Stock symbol||Company name|
|1||RGEN||Regeneron Pharmaceuticals Inc.|
|5||NBIX||Neurocrine Biosciences, Inc.|
For more information about each company, simply scroll down for more details such as market caps, revenue and product ranges.
1.) Regeneron Pharmaceuticals Inc. (NASDAQ: RGEN)
Headquartered in New York and part of both the NASDAQ 100 and S&P 500 indexes, Regeneron Pharmaceuticals is a biotech and pharmaceutical company that was founded in 1988. Regeneron generates around $8 billion of revenue per year and employs over 8,000 staff.
Its top pharamceutical products include Aflibercept, Arcalyst, Praluent, Dupixent, Kevzara, Libtayo, and Inmazeb, and they are used to treat things like inflammation, blindness, athiritic, cardiovascular disease, cancer and even Ebola. With a market cap of over $50 billion, its sheer scale and the variety of treatments if offers has secured its place on our list.
Recently, Regeneron was in the news for providing an experimental COVID-19 antibody treatment for President Trump. Its recent share price performance has been solid if a little volatile, though we can foresee growth with the introduction of new treatments.
2.) Novavax, Inc. (NASDAQ: NVAX)
Based in Maryland, US, and founded in 1987, Novavax is a pharmaceutical company that creates experimental vaccines for major diseases. It did not have a succesful launch until its 2021 NVX-CoV2373 COVID-19 vaccine, and it has now applied for emergency use in the US. It also has a phase 3 clinical trial underway for an influenza vaccine, NanoFlu.
Given its lack of a succesful launch until 2021, its share price has been extremely volatile. However, from 2020 onwards, it has experienced rapid growth and has now has a market cap in excess of $12 billion. This makes it a strong growth stock that has the potential to generate dramatic returns, though its experimental focus comes with increased risks.
Looking to the future, a major potential catalyst comes in the form of Novavax’s COVID-19 vaccine recieving formal authorisation. Moreover, Novavax claims its vaccine has a higher efficacy than some of the major COVID-19 vaccines, though this is largely down to where and how it is tested. If the company can secure approval, it could be en route to profits.
3.) Seagen Inc. (NASDAQ: SGEN)
Seagen, formerly Seattle Genetics, was founded in 1997. It is a biotechnology company that is focussed on developing innovative, antibody-based solutions for cancer. The company’s flagship product is called Adcetris and it is available in 65 countries.
In recent years, Seagen has performed well, generating an annual revenue of over $2 billion and seeing a marked rise in its share price. The company now has a market cap of well over $20 billion, and having secured a licencing deal with pharma giant, GlaxoSmithKline, in 2020, it aims to recapture the attention of investors as it shifts away from COVID-19.
The reason Seagen is on our list is because of the size of the market it is tapping into. Cancer is second only to Heart Disease as the leading cause of death in the United States, and the demand for new innovative therapies gives Seagen an excellent chance of growing revenue.
4.) Ocugen Inc. (NASDAQ: OCGN)
Based in Philadelphia and founded in 2013, Ocugen is a is a clinical-stage biopharmaceutical company that is focussed on developing treatments for rare eye diseases.
The main reason it is on our list is because of its potential for dramatic growth. With only around 50 employees and a market cap of just over $2 billion, the company has plenty of headroom, especially considering the company had a dramatically higher valuation a few years ago.
While Ocugen currently produces virtually no revenue, investors are banking on one of its innovative treatments reaching commericisation, though exactly when this will happen remains to be seen. Ocugen is not a stock for the faint of heart, though for brave investors with an ambitious eye, it could be a winner.
5.) Neurocrine Biosciences, Inc. (NASDAQ: NBIX)
Neurocrine Biosciencies is an American biopharmaceutical company founded in 1992 and based in San Diego, California. The company pioneers treatments for neurological and endocrine-related diseases and disorders.
The company’s main drug, Valbenazine, was approved for use in the US for adults with Tardive Dyskinesia in 2017, and this is the main source of its nearly $800 million yearly revenue. Alongside Valbenazine, Neurocrine is developing treatments at various stages of research for Parkinson’s disease, Tourette syndrome, and congenital adrenal hyperplasia.
The fact that Neurocrine has the inherent value of a profitable treatment combined with numerous potentially lucrative clinicial-stage treatments has resulted in the company being on this list. We feel it strikes a nice blend of an $8 billion value stock with plenty of growth potential, as its work with a partner to treat endometriosis and uterine fibroids demonstrates.
Where to buy the best biotech shares
Generally, the best place to find shares is through a reliable stockbroker with low fees. These are online services that allow you to easily control your entire investment portfolio from a single, user-friendly interface.
What is a biotech stock?
A biotech stock is a publicly traded company that harnesses biological technology. This can include cellular and biomolecular processes with the main aim of creating technologies that enhance quality of life. A simple example of biotechnology that has been used for generations is the fermentation process for certain kinds of cheese.
Are biotech shares a good investment?
Biotech stocks are high-risk, high-reward investments. Many of them are in the process of developing drugs that could eventually solve major illnesses and address multi-billion dollar markets.
However, one mistep can have dramatic consequences. For example, if a US-based biotech company receives an approval or rejection on one batch of trial data from the U.S. Food and Drug Administration, it can send a stock soaring or plummeting in a matter of minutes.
The important thing you need to look for in biotech shares is catalyst moments. Before investing, make sure you are aware of the key dates around which a company’s success or failure will be revealed.
While there can never be true certainty that a biotech stock will be successful, knowing the major milestones can help you anctipiate market movements ahead of time. For the latest news on the biotech sector, click on one of our news links below.