Are These The Best Biotech Stocks To Buy Or Sell Right Now?
The resurgence of COVID-19 globally is once again turning investors’ attention to biotech stocks. From the past several months, many small-cap biotech stocks and top biotech stocks have hit new highs. While most attention this week will be on the outcome of the election, these businesses continue to do well no matter who resides in the Oval Office. Put simply, the biotechnology industry tends to see steady growth because, for many patients, it’s critical to their lives.
Today’s biotech news places the limelight on treatments and vaccine development for the COVID-19 pandemic. For pharmaceutical giants like Johnson & Johnson (JNJ Stock Report) and Pfizer (PFE Stock Report), the COVID-19 vaccine development is at the highest priority right now. With the recent surge of cases globally, you can easily tell what drives the biotech industry in the stock market today.
However, finding the best biotech stocks to buy can be tricky given that volatility often haunts the space. Clinical plans don’t always materialize even though they might show highly promising results in the beginning. But when they do, investors are sure to reap great benefits from the major upside. Yet, when it comes to investing, managing risks should be your utmost priority. After all, there are plenty of COVID-19 vaccine stocks to invest in, but their risk profiles vary too. If you have a bigger risk appetite, then by all means take a chance at those companies with a singular focus on developing a coronavirus vaccine. As we work to prepare ourselves against the virus, we should similarly prep our portfolios.
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Top Biotech Stocks To Watch: Novavax Inc.
First, up the list, Novavax (NVAX Stock Report) is at the front of the pack. Its vaccine candidate, NVX-CoC2373 entered a Phase 2 clinical trial in late August. The trial involves about 1,500 participants and results should come in this quarter. The company easily benefits from the fact that it is under the Operation Warp Speed Programme and several government contracts for its COVID-19 vaccine.
As part of Operation Warp Speed, the government has awarded the company $1.6 billion to produce as many as 100 million vaccine doses. Meanwhile, Canada has an in-principle agreement with Novavax for it to supply up to 76 million vaccine doses. To sum up, the company has $2 billion in funding from various governments.
If you are an early investor, you would have reaped huge benefits from its massive rally this year. While it may be trailing behind Pfizer in the vaccine race, it could still prove to be one of the best. The reason being that Novavax’s vaccine uses a tried and tested recombinant protein method. With that in mind, would NVAX stock be worth adding to your watchlist today?
Top Biotech Stocks To Watch: Moderna
Moderna (MRNA Stock Report) has been the poster child among companies working on a COVID-19 vaccine. Like Novavax, Moderna is also part of the Operation Warp Speed program. Now, what’s noteworthy is that Moderna has no prior experience of successfully commercializing a vaccine. But it is now in Phase 3 clinical trials with its vaccine. That’s not an easy feat. Moderna uses a more innovative approach with its vaccine candidate. It uses messenger ribonucleic acid (mRNA) to teach the immune system to recognize spike proteins on the surface of the virus. The company now has $1.1 billion of deposits for its vaccine.
Assuming things go according to plan, Moderna will have an instant blockbuster product on its hands. But the bigger story for the company lies in the rest of its pipeline. You see, Moderna’s approach of using mRNA against SARS-CoV-2 might be applicable to other diseases as well. This is a similar approach to other drug candidates in Moderna’s pipeline.
If Moderna’s COVID-19 vaccine candidate works, it provides validation for this approach. That may be a sign that other pipeline products using the same approach now stand a higher chance of being successful in later-stage clinical trials. And when that happens, Moderna will most likely be on every investor’s list of top biotech stocks to buy. The question is, would you be willing to take a chance on MRNA stocks at this price?
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Top Biotech Stocks To Watch: Vertex Pharmaceuticals
While Vertex Pharmaceuticals (VRTX Stock Report) may not be producing any COVID-19 related treatments or vaccines, this biotech stock is worth the mention. The company’s main advantage is in its cystic fibrosis (CF) treatments. In fact, the company is a leader in treatments for CF and is currently monopolizing the CF treatment. Another boost to the company has to do with its partnership with CRISPR Therapeutics (CRSP Stock Report) on CTX 001. The drug candidate aims to help patients with transfusion-dependent beta-thalassemia (TDT) and sickle cell disease (SCD). News from this program is grabbing the headlines this week.
CTX001 functions by editing the patient’s DNA to make the cells start expressing fetal hemoglobin again. This is to make up for the lack of hemoglobin in TDT and SCD patients. Earlier, CRISPR and Vertex had reported data for two patients with TDT and one patient with SCD. The most recent report includes three additional TDT patients and one additional SCD patient. That’s in addition to updates on the earlier patients. The data released were positive. All new TDT patients stopped receiving blood transfusions. Besides, in SCD, patients are also free from vaso-occlusive crises (VOC). Previously, patients had averaged 7 VOCs per year. Even though there have only been three months of follow up, the progress is so far very positive.
Vertex also has other drugs in the pipeline, albeit still in early trials. Its VX-150 is a pain medication that targets neuropathic and musculoskeletal pain. Ultimately, with Vertex detailing its plans for the next 5 years, the company has positioned itself to benefit from expected annual growth of 24.4% in the CF market through 2027. With its moat within this niche, is VRTX stock a safe bet for the long term?