Should Investors Buy These Health Care Stocks Before May 2021?
We are still seeing COVID-19 cases rising around the globe despite having vaccines rolled out globally. This has undoubtedly allowed health care stocks to remain in the limelight. So it’s likely that investors would shift their focus back to the health care industry in the stock market. For investors, the logic is quite simple when it comes to investing in the health care industry. Everybody will eventually need health care, regardless of whether there is a pandemic or not. Whether it is digital health care or advancements in biotech, investors still stand to make huge gains nonetheless.
We need to look no further than Johnson & Johnson (NYSE: JNJ) and AstraZeneca (NASDAQ: AZN) for prime examples to illustrate the demand for health care. Although there are reports of side effects in relation to their vaccines, many countries globally are resuming the administration. This comes after many health regulators determined that the benefits would far outweigh the risks.
A new report from the Centers for Disease Control and Prevention (CDC) calculated how many lives the shot could save in the next six months. According to the CDC’s model, continuing to administer the J&J vaccine at just half the rate at which it was used in early April could prevent 580 to 1,400 coronavirus deaths. So, it’s safe to assume that health care has always been important and will likely still be in focus for the foreseeable future. Now let’s look at some of the top health care stocks in the stock market now.
Top Health Care Stocks To Watch Now
- DermTech Inc (NASDAQ: DMTK)
- Brooklyn Immunotherapeutics Inc (NYSE: BTX)
- Novavax, Inc (NASDAQ: NVAX)
- Moderna Inc (NASDAQ: MRNA)
First, we have a dermatology company that focuses on skin cancer, DermTech. The company develops products that facilitate the early detection of skin cancers and customize drug treatments. DermTech aims to transform dermatology by delivering highly accurate, objective information to physicians. The company stock first surged back in December 2020 and has seen significant gains over the past six months, boasting over 270% gains. This was largely due to investors responding favorably to the results from its Pigmented Lesion Assay (PLA), a non-invasive melanoma “rule-out” test. The study confirmed that PLA can eliminate melanoma with a 99% negative predictive value.
Last week, the company announced its next-generation test for the enhanced early detection of melanoma, DermTech PLAplus. It delivers objective and actionable information to guide clinical management decisions for skin lesions that are suspected to be melanoma. Hence, allowing clinicians to detect skin cancers such as melanoma at an earlier stage, which leads to a higher cure rate. DMTK stock rose around 10% this week.
This could be due to investors responding to the speculation that Cigna (NYSE: CI) will be covering the company’s PLA early detection test for melanoma. Should this test turn out to be consistently effective, the company could be looking at considerable upside. Could this make DMTK stock worth watching now?
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Brooklyn Immunotherapeutics Inc
Next up, we have Brooklyn Immunotherapeutics. The company is a clinical-stage biopharmaceutical company focusing on cytokine-based therapies in treating patients with cancer. Brooklyn is developing IRX-2, a cytokine-based therapy, to treat patients with head and neck cancer. As some of you may be aware, the company stock has doubled in price over the past week. BTX stock skyrocketed over 51% on Tuesday, seemingly on the news of a new appointment.
In particular, the company has appointed Matthew During, M.D., Ph.D. to the company’s Scientific Advisory Board. He was a pioneer in the use of viral vectors for neurological disorders. Earlier in April, the company paid $1 million towards the acquisition of a license for Factor Bioscience’s and Novellus’ mRNA Gene Editing and Cell Therapies technology. This would allow Brooklyn to utilize an extensively patented process to seek and develop gene-edited compounds using mRNA. So why is this big?
Because preclinical data suggest it to be more efficient, non-immunogenic and non-mutagenic, for treatment of several solid tumors as well as other inherited disorders. Just as many other health care stocks, any potential breakthrough would be colossal for the company. So could BTX stock be the next big health care stock?
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Novavax, Inc. is a clinical-stage vaccine company that focuses on the discovery, development, and commercialization of recombinant nanoparticle vaccines and adjuvants. With the onset of the global pandemic last year, the company has also ventured into making COVID-19 vaccines. Despite not having any product in the market yet and facing delays in production, it is still expected to be one of the leading vaccine candidates. The company’s vaccine has proven to be just as potent as other vaccine frontrunners. On Tuesday, President Joe Biden hinted that Novavax’s vaccine may be nearing authorization in the U.S.
Furthermore, there was news of Novavax and President Moon Jae-In of South Korea agreeing to expand its current partnership on local production of the new vaccine. South Korea’s SK Bioscience will be handling and producing the vaccine as early as June. Also, Novavax announced last week that its malaria vaccine candidate R21 showed an efficacy of 77%.
Although GlaxoSmithKline (NYSE: GSK) currently markets a malaria vaccine, its efficacy is only between 35% and 55%. Therefore, this would truly be a milestone in malaria prevention if R21 is ultimately approved. So, with what seems like endless opportunities ahead with Novavax, would you consider adding NVAX stock to your watch list?
Last but not least, we have a leading vaccine company, Moderna. As most of you would know, the company is one of the first to receive the Emergency Use Authorization (EUA) from the U.S. Food and Drug Administration (FDA) for its COVID-19 vaccine. Aside from creating a vaccine for the coronavirus, the company is also studying the prospects of creating mRNA-based personalized cancer vaccines and treatments for other rare diseases. Hence, the future of the company looks intact even post-COVID-19. The company stock has seen gains of over 250% over the past year.
On Tuesday, Moderna announced that it is working towards a single shot for both COVID-19 and flu protection. The company hopes to use its mRNA-based technology to knock out several pathogenic birds with one stone. On the same day, DNA Script announced a partnership with Moderna to develop a prototype for rapid mobile manufacturing of vaccines and therapeutics.
The partnership will employ DNA Script’s novel enzymatic synthesis platform to power Moderna’s existing manufacturing technology for the rapid production of mRNA vaccines and therapeutics. The company is surely not taking anything for granted despite having great success over the past year. With that in mind, would MRNA stock make its way into your watchlist?