The biotech industry is poised for a resurgence, as scientists declare it to be the “golden age” of biotechnology.
Remarkable scientific breakthroughs are opening unprecedented avenues for disease treatment and prevention.
This presents a lucrative opportunity to enhance your investment portfolio by including valuable biotech stocks. But here the question arises what is a biotech stock?
Fortunately, you don’t have to undertake extensive research or face the daunting task of identifying the best options.
We have compiled a list of the top biotech stocks that hold the most promise for current investments. Seize the moment and make wise choices in this thriving sector.
What Are Biotech Stocks?
Biotech stocks are shares of companies operating in the biotechnology industry.
Biotechnology is a field that applies biological and scientific principles to develop products and technologies for various industries.
Those include healthcare, agriculture, and environmental preservation.
Biotech companies often focus on areas such as pharmaceuticals, genetic engineering, medical devices, diagnostics, and bioinformatics.
Knowing what is a biotech stock and investing in them allows individuals to participate in the growth and advancements of these companies.
This will potentially benefit investors from their innovations and success.
What’s The Difference Between Biotech And Pharmaceuticals?
While biotech and pharmaceuticals both operate within the healthcare industry, there are key differences between them.
Pharmaceuticals typically refer to companies that develop and manufacture drugs using chemical synthesis.
They often focus on small molecules and compounds synthesized in laboratories.
In contrast, biotech companies utilize living organisms, such as cells or bacteria, to produce therapeutic proteins or develop treatments based on genetic engineering and manipulation.
Biotech companies may also leverage cutting-edge technologies like gene therapy, RNA interference, or stem cell research.
In essence, biotech companies harness the power of biology to create innovative therapies and solutions.
Biotech Companies
Biotech is a compelling investment opportunity, combining scientific advancements with economic potential.
So here we have picked some of the best biotech stocks to be considered in 2023.
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Amgen Inc. (AMGN)
In our quest of what is a biotech stock, the very first stock we have picked is Amgen Inc. (AMGN), a prominent American biopharmaceutical company.
The company stands at the forefront of biologics and holds a significant position in global biotech markets.
Their success can be attributed, in part, to their adeptness in mergers and acquisitions.
In 2019, a partnership with Celgene resulted in the inclusion of Otezla in Amgen’s drug portfolio, while a 20.5% stake in BeiGene facilitated entry into the Chinese oncology market.
The acquisition of Immunex Corporation granted access to the blockbuster drug Enbrel, and the recent purchase of Five Prime Therapeutics introduced the promising drug bemarituzumab.
This strategic approach safeguards Amgen’s future growth despite forthcoming patent expirations.
Amgen has formed a multi-year partnership with TScan Therapeutics to utilize TScan’s unique target discovery platform, TargetScan.
The collaboration aims to identify the antigens that T cells recognize in Crohn’s disease patients.
TScan will receive an upfront payment of $30 million and stands to earn more than $500 million through preclinical, clinical, regulatory, and commercial milestones, along with royalty payments.
Amgen will explore various modalities for developing therapeutics based on the identified targets and will hold exclusive global rights for development and commercialization.
Additionally, Amgen has the option to extend the collaboration to include ulcerative colitis, subject to specific conditions.
Amgen stands out on our list due to its robust financial profile and its performance in the recently reported quarter.
Despite a minor 2% decline in sales at $6.1 billion, its earnings soared by an impressive 97% to $5.28 per share.
Moreover, the company offers an attractive dividend yield of 3.83%.
With a combination of these strengths and a stable price over the last three months, Amgen emerges as an excellent biotech stock to consider adding to your portfolio.
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Biogen Inc. (BIIB)
Biogen Inc. (BIIB), a prominent biotech company based in the United States, takes its place on our list of noteworthy biotech stocks.
Despite the controversies surrounding its drug Aduhelm and the intensifying competition from generic alternatives, Biogen cannot be overlooked.
In a recent development, Biogen, in collaboration with Eisai Co., Ltd., announced a significant achievement.
The Peripheral and Central Nervous System Drugs Advisory Committee (PCNS) of the U.S. Food and Drug Administration (FDA) unanimously validated the efficacy of LEQEMBI.
The drug is also known as lecanemab and is used in treating Alzheimer’s disease (AD).
The committee’s evaluation was based on the conclusive data from Eisai’s Phase 3 Clarity AD clinical trial.
LEQEMBI, a result of the strategic research alliance between Eisai and BioArctic, demonstrated a favorable overall benefit-risk profile, as affirmed by the committee members.
Notably, the drug’s marketing authorization application has been submitted to the Ministry of Food and Drug Safety (MFDS) in South Korea.
This marks the first application for lecanemab in Asia outside of Japan and China. Eisai intends to file additional applications in various Asian countries.
Furthermore, Health Canada has accepted a New Drug Submission (NDS) for LEQEMBI, acknowledging its potential and significance in the healthcare landscape.
Despite the expiration of the Tecfidera patent and increased generic competition, Biogen remains financially strong.
Last quarter, the company’s earnings surged 30% to $387.9 million ($2.67 per share).
Although the cash balance decreased by 18% to $2.9 billion, sales reached $2.46 billion, surpassing expectations despite a slight decline.
With a share price up by almost 56% since last year, Biogen is an attractive stock to consider adding to your portfolio and holding onto.
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Bio-Techne Corporation (TECH)
As part of our journey to discover what is a biotech stock, we are adding Bio-Techne (TECH) to our stock lineup.
This U.S.-based biotech company specializes in supplying life science reagents, instruments, and services to global research, diagnostics, and Bioprocessing markets.
Unlike other biotech firms on our list, Bio-Techne offers investors a gateway into the thriving genomics industry, predicted to grow at an impressive 16.87% by 2030 to $98.7 billion.
With a rich legacy of innovation, Bio-Techne has amassed an extensive array of proteomic research reagents, empowering groundbreaking scientific breakthroughs.
This exceptional feature further enhances the appeal of investing in this biotech gem. In spite of its already substantial presence, Bio-Techne continues to forge ahead with its expansion efforts.
One recent endeavor involved the augmentation of their Advanced Cell Diagnostics (ACD)-branded RNAscope in situ hybridization (ISH) portfolio.
That was through the introduction of an RNAscope multiomic workflow compatible with the Standard BioTools Hyperion Imaging System.
The integration of multiomic spatial imaging into the Hyperion Imaging System presents an unprecedented opportunity to generate intricate and comprehensive tissue architectural maps.
It establishes connections between transcripts, proteins, and signaling networks within tissues.
The technology enables the assessment of drug efficacy, the discovery of innovative intervention methods, and the identification of informative biomarkers.
Consequently, it possesses the potential to become a cornerstone of precision medicine approaches in the future.
Moreover, Bio-Techne boasts an appealing financial profile, including a dividend payout of 0.43%.
During their most recent fiscal quarter, which concluded on March 31, 2023, the company achieved organic revenue of $294.1 million, marking a respectable 3% year-over-year growth.
Additionally, quarterly earnings per share rose from $0.37 in the previous year to $0.43.
Considering the substantial potential for growth, the reduced risk factor, and the company’s robust financial standing, investing in Bio-Techne stock is a highly favorable decision.
Furthermore, the current market volatility has caused the stock to trade at a price that remains approximately 9.5% lower year-to-date, presenting an advantageous buying opportunity.
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Exelixis Inc (EXEL)
Exelixis Inc (EXEL), a U.S.-based biotech company focused on oncology, stands out as a resilient player in the market.
Nonetheless, Exelixis remains committed to its core objectives and has made substantial strides in advancing its commercial endeavors and expanding its pipeline.
CABOMETYX is a leading tyrosine kinase inhibitor for renal cell carcinoma.
It maintained its position in the first quarter, primarily attributed to its successful utilization in combination with nivolumab for first-line treatment.
The company has also made notable progress across various pipeline programs, including the STELLAR-303 and STELLAR-304 Phase 3 trials for zanzalintinib.
EXEL also progressed well as the phase 1 trial of XB002, exploring single-agent and combination dose-escalation cohorts.
Exelixis aims to initiate pivotal studies for zanzalintinib in 2023 and expedite the full development of XB002 by year-end.
Notably, the company has also achieved steady advancements through collaborations with Cybrexa and Sairopa.
Sairopa received FDA clearance for its Investigational New Drug application for ADU-1805 in February, followed by the commencement of a phase 1 study in March.
In terms of financials, Exelixis witnessed a 15% year-over-year revenue growth in Q1 2023, totaling $408.79 million.
However, increased research and development (R&D) as well as selling, general, and administrative (SG&A) expenses led to a 40% decline in income, settling at $40 million.
Looking ahead, the company anticipates full-year revenue ranging from $1.78 billion to $1.88 billion in 2023.
Consequently, with a modest 7% price performance over the past 12 months, Exelixis presents an attractive opportunity for investors.
It will not only diversify their portfolios but also offers a promising biotech stock poised for growth.
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Corcept Therapeutics Incorporated (CORT)
Corcept Therapeutics (CORT) emerges as a prominent player in the biotech sector.
It specializes in the development of drugs that effectively manage unstable cortisol levels and associated disorders.
At the forefront of their product lineup is Korlym, a groundbreaking treatment approved for Cushing’s syndrome in type 2 diabetes patients.
This drug holds orphan status and exclusive rights until 2037 for Cushing’s, and Corcept is diligently working towards securing approvals for additional indications.
The potential for Korlym’s expansive market reach is immense, given its multiple applications.
To further enhance physicians’ ability to identify and treat patients with hypercortisolism, CORT is making substantial investments.
A noteworthy initiative is the recently established CATALYST study, which holds promise for significant growth in the field of Cushing’s syndrome treatment.
From a financial standpoint, Corcept Therapeutics demonstrates exceptional performance.
In the first quarter of 2023 alone, the company experienced a remarkable 13% revenue increase, amounting to $105.66 million.
Moreover, Corcept boasts a net income of 15 cents per share, while maintaining a robust cash balance of $465.06 million by the end of the quarter.
Notably, the company’s return on equity stands well above the industry average, at an impressive 19.40%.
Considering the impressive progress in Corcept’s pipeline and its recent one-month price decline of 5%, an opportune moment arises for potential investors.
With its proven track record, strong financial profile, and promising growth prospects, Corcept presents a compelling buying opportunity.
CORT may also yield significant returns as the company’s stock price is poised to soar once again.
To further explore what is a biotech stock and which are performing well, we have carefully selected 20 tickers here that represent the top 20 biotech stocks with outstanding performance, exceeding 80% YTD.
These promising options are poised to make a significant impact in 2023, offering the potential for substantial returns.
20 Best Performing Biotech Stocks |
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| No. | Ticker | Company | Market Cap (in million) | Performance (YTD) | Price |
| 1 | AMAM | Ambrx Biopharma Inc. | 788.28 | 556.22% | 14.9 |
| 2 | GNLX | Genelux Corporation | 856.95 | 457.80% | 34.31 |
| 3 | BMEA | Biomea Fusion, Inc. | 1407.4 | 336.89% | 36.83 |
| 4 | IMGN | ImmunoGen, Inc. | 4163.14 | 273.08% | 18.5 |
| 5 | PTGX | Protagonist Therapeutics, Inc. | 1659.44 | 161.96% | 28.58 |
| 6 | MLTX | MoonLake Immunotherapeutics | 1410.18 | 161.19% | 27.42 |
| 7 | IRON | Disc Medicine Opco Inc | 837.9 | 146.35% | 49 |
| 8 | RETA | Reata Pharmaceuticals, Inc. | 3850.63 | 140.91% | 91.52 |
| 9 | NVCT | Nuvectis Pharma, Inc. | 286.81 | 140.27% | 18.02 |
| 10 | VKTX | Viking Therapeutics, Inc. | 2283.33 | 139.36% | 22.5 |
| 11 | CBUS | Cibus, Inc. | 56.84 | 137.15% | 17.49 |
| 12 | TGTX | TG Therapeutics, Inc. | 4285.47 | 126.29% | 26.77 |
| 13 | MORF | Morphic Holding, Inc. | 2706.85 | 123.08% | 59.67 |
| 14 | TYRA | Tyra Biosciences, Inc. | 642.07 | 116.91% | 16.49 |
| 15 | VYGR | Voyager Therapeutics, Inc. | 555.08 | 111.23% | 12.89 |
| 16 | BBIO | BridgeBio Pharma, Inc. | 2759.99 | 105.77% | 15.68 |
| 17 | VECT | VectivBio Holding AG | 1047.68 | 93.25% | 16.75 |
| 18 | HEPA | Hepion Pharmaceuticals, Inc. | 49.52 | 92.47% | 11.56 |
| 19 | ELTX | Elicio Therapeutics, Inc. | 84.96 | 82.63% | 14.82 |
| 20 | RXDX | Prometheus Biosciences, Inc. | 9549.57 | 81.77% | 199.95 |
We have also compiled a list of the 5 best biotech penny stocks which has performed well this year. These penny stocks could be a better investment opportunity for long term growth.
These stocks are currently trading at relatively low prices and have the potential to generate good returns over time.
Best Biotech Penny Stocks |
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| No. | Ticker | Company | Market Cap (in million) | Performance (YTD) | Price |
| 1 | VYNE | VYNE Therapeutics Inc. | 18.67 | 73.33% | 4.68 |
| 2 | DBTX | Decibel Therapeutics, Inc. | 112.82 | 114.63% | 4.4 |
| 3 | LSTA | Lisata Therapeutics, Inc. | 35.06 | 70.75% | 4.32 |
| 4 | ASLN | ASLAN Pharmaceuticals Limited | 64.28 | 116.13% | 3.89 |
| 5 | NAUT | Nautilus Biotechnology, Inc. | 426.56 | 112.78% | 3.83 |
Taking the exploration of what is a biotech stock a step further; we have compiled a list of some of the best biotech stocks under $1.
These biotech stocks under $1 could prove to be a good investment for long term growth.
The biotech stocks under $1 are currently trading at a relatively low price and may be able to generate good returns in the future.
Best Biotech Stocks Under $1 |
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| No. | Ticker | Company | Market Cap (in million) | Performance (YTD) | Price |
| 1 | EFTR | eFFECTOR Therapeutics, Inc. | 52.16 | 131.52% | 0.99 |
| 2 | ERYP | ERYTECH Pharma S.A. | 32.19 | 142.35% | 0.8 |
| 3 | PHGE | BiomX Inc. | 15.38 | 88.06% | 0.35 |
| 4 | VBLT | Vascular Biogenics Ltd. | 18.99 | 102.58% | 0.24 |
| 5 | ATOS | Atossa Therapeutics, Inc. | 113.96 | 67.70% | 0.89 |
What Drives Biotech Stocks?
Several factors can drive the performance and volatility of biotech stocks:
Examples Of Price Swings
Biotech stocks are particularly sensitive to events such as clinical trial results, regulatory approvals, and market sentiment.
Positive clinical trial data or regulatory milestones, such as receiving approval from the U.S. Food and Drug Administration (FDA), can significantly impact stock prices.
Conversely, negative trial results or regulatory setbacks can lead to sharp declines.
Additionally, broader market trends, investor sentiment toward the biotech sector, and the overall economic climate can also influence biotech stock prices.
How To Invest In Biotechnology
Investing in biotechnology can be done through various avenues:
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How To Invest in Biotechnology Stocks?
If you want to know how to invest in biotech stocks, it is better to purchase individual stocks of biotech companies.
Before investing, it is crucial to research and analyze the financial health, product pipeline, and competitive position of the companies in consideration.
Understanding the risks associated with the specific biotech sector and diversifying investments across multiple companies can help manage risk.
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How To Invest in Biotechnology ETFs?
Biotechnology-focused Exchange-Traded Funds (ETFs) offer a convenient and cost-effective way to gain exposure to the biotech sector.
Investors in search of how to invest in biotech stocks can also use ETFs as an alternative and more promising option. ETFs offer a diversified approach to investing in the targeted sector.
Biotech ETFs consist of a basket of biotech stocks, providing exposure to multiple companies within the industry.
This approach can help reduce risk by spreading investments across different companies and potentially capturing broader industry trends.
What’s The Outlook for Biotechnology?
The outlook for biotechnology is generally positive due to ongoing advancements in healthcare, increasing demand for innovative treatments, and the potential for transformative discoveries.
According to Data Bridge Market Research analyses, the global biotechnology market is expected to reach $10 trillion by 2030, at a compound annual growth rate (CAGR) of 29%.
However, the industry can also face challenges related to clinical trials, regulatory hurdles, and competition.
It is important to stay informed about the latest developments, regulatory changes, and market trends when considering investments in biotech.
Risks Of Biotechnology Stocks
Investing in biotech stocks involves certain risks that investors should be aware of:
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Clinical Failure
Biotech companies often conduct clinical trials to evaluate the safety and efficacy of their products.
However, there is always a risk of clinical failure, where a drug or treatment does not meet the desired endpoints.
Negative trial results can lead to significant stock price declines, as it may delay or halt the product’s development and commercialization.
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Regulatory Issues
Regulatory approval is a critical milestone for biotech companies. The FDA and other regulatory bodies have stringent requirements for safety and efficacy.
Delays or rejections in obtaining approvals can negatively impact stock prices.
Additionally, changes in regulations or unexpected adverse events related to approved products can also affect the performance of biotech stocks.
Developing The Market
Biotech companies face specific challenges in developing and commercializing their products including:
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Patent Expiration
Patents play a vital role in protecting the intellectual property of biotech companies.
However, patents have limited lifespans, and once they expire, other companies can produce generic versions of the drug, potentially leading to a decline in sales and market share.
Companies must continuously innovate and develop new products to stay competitive after patent expiration.
Challenges With Researching Biotech Stocks
Researching biotech stocks can be complex and challenging due to several factors:
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Scientific Complexity
Understanding the scientific concepts and technical aspects of biotech companies requires specialized knowledge and expertise.
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Pipeline Evaluation
Assessing the potential of a company’s product pipeline, clinical trial outcomes, and market prospects demands careful analysis and understanding of the regulatory landscape.
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Volatility
Biotech stocks can be highly volatile, making it challenging to predict future performance accurately.
Best Online Brokers for Biotech Penny Stocks
Investing in biotech penny stocks, which are low-priced stocks, typically involves higher risk and volatility.
To better understand how to invest in biotech stocks online, it is important to choose reputable and reliable online brokers.
Suitable brokers offer access to these stocks while providing robust trading platforms, research tools, and competitive pricing.
Some popular online brokers known for their biotech offerings include Charles Schwab, TD Ameritrade, Fidelity, E*TRADE, and Interactive Brokers.
However, it is advisable to conduct thorough research and consider individual preferences before selecting a specific broker.
Conclusion
In conclusion, biotech stocks offer investors an opportunity to participate in the advancements of the biotechnology industry.
However, it is important to under what is a biotech stock and carefully evaluate the risks. Investors should also conduct thorough research, and stay informed about the latest developments in the sector before making investment decisions.
Diversification, understanding the scientific and regulatory landscape, and staying abreast of market trends are crucial elements in navigating the biotech investment landscape.
Frequently Asked Questions
Which Biotech Penny Stocks Should I Buy?
As an AI language model, I cannot provide real-time financial advice or stock recommendations.
It is important to conduct thorough research and consult with a financial advisor before making any investment decisions.
Biotech penny stocks can be highly volatile and risky, so it’s crucial to evaluate the company’s financials, pipeline, and market potential before investing.
Is Biotech a Safe Investment?
Biotech, a rapidly evolving field, presents opportunities and risks as an investment.
While breakthroughs in healthcare, agriculture, and energy hold immense potential, regulatory challenges, clinical trial outcomes, and patent disputes introduce volatility.
Thorough research, diversification, and understanding of industry dynamics are essential to navigate this complex landscape and make informed investment decisions.
