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3 Biotech Stocks Worth Adding to Your Portfolio Next Year
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The volatile biotech sector had a roller coaster ride in 2021 but the rapid development of vaccines and antibody treatments for COVID-19 kept it in the spotlight. While the performance of the overall sector has been on the downside year to date, the emergence of the deadly variants of COVID-19 should keep the sector in focus going forward.
Companies like Moderna (MRNA - Free Report) , which developed vaccines in record time, are in continued focus and the massive surge in its share price fueled the overall sector despite the headwinds. This trend is expected to remain with booster doses of the vaccines becoming the need of the hour.
Even though the bigwigs of the sector face challenges as sales of established drugs take a hit due to a slowdown and increased competition, new drug approvals are likely to maintain the momentum. The regulatory nod to Biogen’s (BIIB - Free Report) Alzheimer's disease (AD) drug Aduhelm propelled the entire sector. The approval also brought other companies to notice that are developing drugs for AD and investors are optimistic about the prospects of these pipeline candidates.
The pace of mergers & acquisitions had slowed down in 2021 from the previous years’ levels. However, as the economic scenario improves, mergers and buyouts should pick up the pace as pharma/biotech bigwigs eye lucrative acquisitions to bolster their portfolio/pipeline and combat the rivalry woes.
Merck recently acquired the rare diseases-focused company Acceleron Pharma. Pharma giant Pfizer recently announced that it will acquire Arena Pharmaceuticals, Inc. for $6.7 billion. While oncology and immuno-oncology are the key areas of focus, treatments for rare diseases and gene-editing companies also look promising with great potential, thereby making these lucrative areas of investment.
However, given the uncertain economic environment, the inherent risks of the sector get intensified. In such a scenario, choosing a biotech stock for investment can be tricky. Particularly, smaller biotechs are riskier as their product pipelines are several years away from commercialization.
Repligen Corporation (RGEN - Free Report) , a global sciences company, provides bioprocessing technologies and solutions used by large biopharmaceutical companies and contract manufacturing organizations for manufacturing biologic drugs, such as monoclonal antibodies (mAbs) and gene therapies. RGEN experienced a buoyancy in demand, driven by strong COVID-induced tailwinds. Revenues from gene therapy customers also bumped up the top line. The momentum should continue in 2022 as well.
Repligen made a few promising acquisitions to diversify its business or boost its core competencies. These buyouts are significantly boosting RGEN’s top line, a trend anticipated to continue.
Shares of Repligen have surged 38.1% in the year so far against the industry's decline of 19.6%.
Image Source: Zacks Investment Research
Sarepta Therapeutics (SRPT - Free Report) primarily focuses on developing exon-skipping drug candidates targeting Duchenne muscular dystrophy (DMD), a rare genetic disorder affecting children (primarily males). SRPT commercializes three products, namely Exondys 51 (indicated for treating DMD in patients with a confirmed mutation of the dystrophin gene that is amenable to exon 51 skipping), Vyondys 53 (indicated for the treatment of DMD in patients with a confirmed mutation of the dystrophin gene amenable to exon 53 skipping) and Amondys 45 (indicated for treating DMD in patients who have a confirmed mutation of the dystrophin gene amenable to exon 45 skipping).
EXONDYS 51 witnessed impressive growth and this momentum should continue. The uptake of the other two products has also been encouraging so far and should further fuel growth in 2022. SRPT is conducting a confirmatory study on the clinical benefits of these drugs for gaining continued approval. The same is also looking to build its DMD pipeline beyond PMO-based exon-skipping treatments.
While the share price declined significantly earlier in the year following a pipeline update on Sarepta’s gene therapy candidate SRP-9001, strong demand for its commercial DMD drugs and a promising pipeline progress bode well for 2022.
The stock has rallied 13.4% in the past six months.
Image Source: Zacks Investment Research
BeiGene (BGNE - Free Report) commercializes a range of oncology medicines in China licensed from Amgen and Bristol Myers Squibb. BGNE currently has the three following approved drugs in the portfolio: BTK inhibitor Brukinsa in the United States, China, the EU, Canada, Australia, the United Kingdom and additional international markets; the non-FC-gamma receptor binding anti-PD-1 antibody tislelizumab and the PARP inhibitor pamiparib in China. It also has a broad portfolio of more than 40 clinical candidates. BGNE is making a good pipeline progress through strategic collaborations as well.
Solid demand for its approved drugs and an encouraging pipeline progress should enable BGNE to sustain the momentum.
Shares of BeiGene have gained 4% in the year so far.
Image Source: Zacks Investment Research
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3 Biotech Stocks Worth Adding to Your Portfolio Next Year
The volatile biotech sector had a roller coaster ride in 2021 but the rapid development of vaccines and antibody treatments for COVID-19 kept it in the spotlight. While the performance of the overall sector has been on the downside year to date, the emergence of the deadly variants of COVID-19 should keep the sector in focus going forward.
Companies like Moderna (MRNA - Free Report) , which developed vaccines in record time, are in continued focus and the massive surge in its share price fueled the overall sector despite the headwinds. This trend is expected to remain with booster doses of the vaccines becoming the need of the hour.
Even though the bigwigs of the sector face challenges as sales of established drugs take a hit due to a slowdown and increased competition, new drug approvals are likely to maintain the momentum. The regulatory nod to Biogen’s (BIIB - Free Report) Alzheimer's disease (AD) drug Aduhelm propelled the entire sector. The approval also brought other companies to notice that are developing drugs for AD and investors are optimistic about the prospects of these pipeline candidates.
The pace of mergers & acquisitions had slowed down in 2021 from the previous years’ levels. However, as the economic scenario improves, mergers and buyouts should pick up the pace as pharma/biotech bigwigs eye lucrative acquisitions to bolster their portfolio/pipeline and combat the rivalry woes.
Merck recently acquired the rare diseases-focused company Acceleron Pharma. Pharma giant Pfizer recently announced that it will acquire Arena Pharmaceuticals, Inc. for $6.7 billion. While oncology and immuno-oncology are the key areas of focus, treatments for rare diseases and gene-editing companies also look promising with great potential, thereby making these lucrative areas of investment.
However, given the uncertain economic environment, the inherent risks of the sector get intensified. In such a scenario, choosing a biotech stock for investment can be tricky. Particularly, smaller biotechs are riskier as their product pipelines are several years away from commercialization.
Here we zero in on three biotech companies, which hold enough room for an upside, backed by strong fundamentals. These stocks currently carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
3 Biotech Stocks to Bet on in 2022
Repligen Corporation (RGEN - Free Report) , a global sciences company, provides bioprocessing technologies and solutions used by large biopharmaceutical companies and contract manufacturing organizations for manufacturing biologic drugs, such as monoclonal antibodies (mAbs) and gene therapies. RGEN experienced a buoyancy in demand, driven by strong COVID-induced tailwinds. Revenues from gene therapy customers also bumped up the top line. The momentum should continue in 2022 as well.
Repligen made a few promising acquisitions to diversify its business or boost its core competencies. These buyouts are significantly boosting RGEN’s top line, a trend anticipated to continue.
Shares of Repligen have surged 38.1% in the year so far against the industry's decline of 19.6%.
Sarepta Therapeutics (SRPT - Free Report) primarily focuses on developing exon-skipping drug candidates targeting Duchenne muscular dystrophy (DMD), a rare genetic disorder affecting children (primarily males). SRPT commercializes three products, namely Exondys 51 (indicated for treating DMD in patients with a confirmed mutation of the dystrophin gene that is amenable to exon 51 skipping), Vyondys 53 (indicated for the treatment of DMD in patients with a confirmed mutation of the dystrophin gene amenable to exon 53 skipping) and Amondys 45 (indicated for treating DMD in patients who have a confirmed mutation of the dystrophin gene amenable to exon 45 skipping).
EXONDYS 51 witnessed impressive growth and this momentum should continue. The uptake of the other two products has also been encouraging so far and should further fuel growth in 2022. SRPT is conducting a confirmatory study on the clinical benefits of these drugs for gaining continued approval. The same is also looking to build its DMD pipeline beyond PMO-based exon-skipping treatments.
While the share price declined significantly earlier in the year following a pipeline update on Sarepta’s gene therapy candidate SRP-9001, strong demand for its commercial DMD drugs and a promising pipeline progress bode well for 2022.
The stock has rallied 13.4% in the past six months.
BeiGene (BGNE - Free Report) commercializes a range of oncology medicines in China licensed from Amgen and Bristol Myers Squibb. BGNE currently has the three following approved drugs in the portfolio: BTK inhibitor Brukinsa in the United States, China, the EU, Canada, Australia, the United Kingdom and additional international markets; the non-FC-gamma receptor binding anti-PD-1 antibody tislelizumab and the PARP inhibitor pamiparib in China. It also has a broad portfolio of more than 40 clinical candidates. BGNE is making a good pipeline progress through strategic collaborations as well.
Solid demand for its approved drugs and an encouraging pipeline progress should enable BGNE to sustain the momentum.
Shares of BeiGene have gained 4% in the year so far.