2025 was a catalyst year for biotech and drug stocks. While the year began on a cautious note for the sector due to concerns over potential tariffs on pharmaceutical imports, the sector rebounded in the second half. Large drugmakers’ drug pricing agreements with the Trump administration and an increase in M&A activity fueled this rally. New drug approval and rapid pipeline progress also contributed to the sector recovery. So far this year, the FDA has approved 44 novel therapies, out of which 26 were approved in the past six months, highlighting an acceleration in regulatory activity as the year progressed.

The biotech and drug industry continues to attract investor attention regardless of industry dynamics, given the ongoing need for innovative medical treatments.

Here, we discuss three biotech/drug stocks that took a beating in 2025 but are likely to bounce back in 2026 based on anticipated regulatory approvals and/or positive pipeline updates. These are Altimmune (ALT Quick QuoteALT - Free Report) , ImmunityBio (IBRX Quick QuoteIBRX - Free Report) and Seres Therapeutics (MCRB Quick QuoteMCRB - Free Report) . All three stocks carry a Zacks Rank #2 (Buy) and have seen positive estimate revisions for 2026.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Altimmune

ALT is a clinical-stage biotech focused on developing therapies targeting liver diseases. Its lead pipeline candidate is pemvidutide, a novel peptide-based GLP-1/glucagon dual receptor agonist currently being developed in a mid-stage study for a fatty liver disease called metabolic dysfunction-associated steatohepatitis (MASH).

Shares of Altimmune have plummeted more than 46% year to date, largely due to mixed top-line results from the phase IIb IMPACT study reported in June, which evaluated pemvidutide in MASH patients over 24 weeks. While this study met one of its primary endpoints — MASH resolution without worsening fibrosis — it failed to achieve statistical significance in the other co-primary endpoint of improving fibrosis without MASH worsening. Despite this setback, the company still highlighted encouraging signs of anti-fibrotic activity, along with improvements in non-invasive tests (NITs) of fibrosis and inflammation.

Earlier this month, Altimmune reported 48-week top-line results from the IMPACT study, which showed further improvements in NITs compared to the 24-week results, along with statistically significant reductions across liver health and hepatic inflammation biomarkers. The results also showed that additional weight loss was observed in patients treated at the higher drug dose compared to the 24-week data, without any signs of plateauing.

Alongside the 48-week results, Altimmune also announced that it held a meeting with the FDA where it reached alignment on key parameters for a late-stage study on pemvidutide in the MASH indication. ALT plans to start this study in 2026, potentially clearing a path toward its first marketed drug.

Apart from MASH, Altimmune is also evaluating the drug in separate mid-stage studies for alcohol use disorder (AUD) and alcohol-associated liver disease (ALD). A data readout from the AUD study is expected next year, which could serve as a catalyst for the stock.

Loss per share estimates for 2026 have improved from $1.33 to $1.13 in the past 60 days.

ImmunityBio

IBRX is a commercial-stage biotech focused on developing novel therapies targeting cancer and infectious diseases. Anktiva, the sole-marketed drug in its portfolio, was approved by the FDA last year in combination with Bacillus Calmette-Guérin (BCG) to treat adults with BCG-unresponsive non-muscle invasive bladder cancer (NMIBC) with carcinoma in situ (CIS), with or without papillary tumors.

Yet, shares of ImmunityBio have lost more than 16% so far this year. This decline is primarily attributable to a regulatory setback earlier this year, when the company received a refusal to file (RTF) letter from the FDA for a regulatory filing seeking label expansion for Anktiva plus BCG in BCG-unresponsive papillary-only NMIBC. IBRX is currently evaluating its next steps to address this issue.

That said, underlying fundamentals remain encouraging. So far this year, the drug has generated nearly $75 million in sales, a significant increase from nearly $7 million recorded in the year-ago period, driven by increased demand trends. The company is also seeking to expand the drug’s market beyond the United States. A regulatory filing is currently under review in the European Union seeking conditional marketing authorization for the drug in the above indication. Earlier this month, an EMA advisory committee recommended approving this filing. A final decision is expected soon.

ImmunityBio is also developing Anktiva, both as a monotherapy and in combination with other agents, for expanded use in bladder cancer as well as for other cancer indications like non-small cell lung cancer (NSCLC), glioblastoma and non-Hodgkin lymphoma. In NSCLC studies, the drug has shown potential to reverse lymphopenia and extend overall survival, while in glioblastoma studies, it showed strong data in achieving disease control. We expect the company to provide an update on these studies in 2026.

Loss per share estimates for 2026 have improved from 37 cents to 33 cents in the past 60 days.

Seres Therapeutics

A clinical-stage biotech, MCRB is focused on developing new therapies comprised of rationally selected live bacterial consortia. Its lead pipeline drug is SER-155, an investigational oral live biotherapeutic designed to prevent life-threatening bloodstream infections (BSIs) and related complications in patients undergoing allogeneic hematopoietic stem cell transplantation (allo-HSCT).

Investor attention toward SER-155 increased after Seres Therapeutics reported encouraging data from a phase Ib study, which showed that treatment with the drug achieved a 77% relative reduction in bacterial BSIs compared to placebo in adults undergoing allo-HSCT. The results also suggest the drug’s potential to treat inflammatory and immune-mediated diseases.

Regulatory response has also been positive. Recently, the FDA issued constructive feedback supporting SER-155’s advancement to mid-stage development. While Seres Therapeutics is currently engaged in securing the necessary funding for this study, it believes that it will be able to provide an interim update within 12 months of study initiation.

Year to date, shares of Seres Therapeutics have lost nearly 12%.

Loss per share estimates for 2026 have improved from $10.66 to $7.67 in the past 60 days.