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- This article covers seven cheap biotech stocks for investors with a high risk tolerance.
- ImmunityBio (IBRX): Boasts an extensive pipeline that covers multiple chronic conditions.
- Selecta Biosciences (SELB): Clinical-stage biotech with truckloads of cash to take its novel immune tolerance platform past the finish line.
- Bluebird Bio (BLUE): Speculative biotech with a colossal growth runway if the FDA gives its gene therapies the green light.
- Vistagen Therapeutics (VTGN): Unique portfolio of therapeutics which target the nervous system in an industry set for tremendous growth ahead.
- BioNano Genomics Inc (BNGO): This meme stock could develop a long-term recurring revenue-generating machine with its genome image editing tool.
- Verastem (VSTM): This startup develops novel cancer treatments with the goal of delivering the best-in-class RAS pathway product.
- BioCryst Pharmaceuticals (BCRX): Biotech with a robust rare disease drug portfolio and strong liquidity.
Source: Mongkolchon Akesin / Shutterstock.com
Amidst immense market volatility, investors favor value-oriented sectors to minimize risk. Hence, pre-revenue firms burning truck-loads of cash on their product pipelines have suffered. Most biotech stocks fall under this category which is going all-in researching ground-breaking potential cures. Investing in cheap biotech stocks is a wager on their long-term potential and is a strategy that might not be for the faint of heart.
The biotechnology sector received massive cash injections during the pandemic years, which helped move the needle for biotech stocks. However, the industry has cooled off considerably amidst investors rotating out of growth stocks. Moreover, drug pricing issues, rising inflation rates, and unsuccessful trials have also contributed to the slowdown.
Nevertheless, investors are hopeful that the sector will perform well this year. A study conducted by financial services firm RBC states that 66% of investors believe the biotech industry will outperform this year. Moreover, 58% of survey participants said they would “increase their exposure to the sector.”
Here are my top seven biotech stocks to buy now:
|SELB||Selecta Biosciences, Inc.||$0.78|
|BLUE||bluebird bio, Inc.||$3.32|
|VTGN||VistaGen Therapeutics, Inc.||$1.14|
|BNGO||Bionano Genomics, Inc.||$1.64|
|BCRX||BioCryst Pharmaceuticals, Inc.||$8.78|
Biotech Stocks: ImmunityBio (IBRX)
ImmunityBio (NASDAQ:IBRX) is an interesting biotech stock with the potential to blow up in the future. A lot has to do with its extensive pipeline, which caters to various conditions. There are currently over 20 ongoing trials, many of which are in the latter stages of clinical development. Some of the treatments in its pipeline are for chronic diseases, such as cancer and HIV. Its core drug candidate Anktiva is being explored for non-muscle invasive bladder cancer (NMIBC) patients.
The company recently reported data on a late-stage trial for Anktiva. 83 patients with NMIBC had taken part in the trial over results compiled over 24.1 months. The response rate came in at 71% for the drug, significantly higher than other therapies in the market and development. Moreover, the drug was well-tolerated without any safety troubles. Additionally, IBRX has goals to develop potential treatments for multiple ailments, including HIV, Covid-19 and other conditions, which could result in massive sales down the line.
Selecta Biosciences (SELB)
Selecta Biosciences (NASDAQ:SELB) is clinical-stage biotech company based out of Boston. It focuses on developing drug candidates using its novel immune tolerance platform, ImmTOR, which reduces undesirable immune responses to promote antigen-specific immunity. Autoimmune diseases are currently treated using immunosuppression techniques linked with several side effects, leaving patients at risk of serious infections. Selecta’s approach is unique and looks to restore natural self-tolerance.
The company has multiple pipeline assets and partnerships to develop its therapies with larger drug companies. Nonetheless, its pipeline is mainly in its early stages, with one exception. The SEL-212 is one of its key clinical product candidates, which is currently in the third phase of development for treating chronic refractory gout.
The company recently reported its results, which showed a healthy cash balance of $118.8 million. It has enough organic resources to take its pipeline candidates past the developmental finish line.
Biotech Stocks: Bluebird Bio (BLUE)
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Bluebird Bio (NASDAQ:BLUE) is another speculative biotech with an incredible growth runway if the U.S. Food and Drug Administration (FDA) greenlights its gene therapies. It targets three FDA approvals within the next couple of years, barring any unforeseen events. The company has struggled to get going in the past, but over the last few years, it seems to have turned a corner.
The three therapies under question are for beta-thalassemia, cerebral adrenoleukodystrophy, and sickle cell disease. Therapies for the first two diseases could be approved by the FDA this year, while sickle cell therapy could go through by 2023. Though it’s still a speculative scenario, the biotech could have three revenue drivers by next year. Moreover, if it obtains priority vouchers for either of these therapies, they can be sold to other upstarts for $100 million each to speed up their approval process.
Vistagen Therapeutics (VTGN)
Vistagen Therapeutics (NASDAQ:VTGN) primarily focuses on treatments related to the nervous system. Some of the conditions its pipeline covers include epilepsy, addiction, ADHD, and other related issues. The anxiety and depression treatment industry will likely increase to $19.81 billion by 2028, growing at a steady 2.4%.
This company has gained a lot of traction for anti-anxiety nasal spray, which could offer a quick fix for reducing anxiety during stressful activities. It has also been awarded a patent in South Korea for its major depressive disorder candidate called PH10. Its synthetic nasal spray is entering phase 3 trials and is on the path toward approval, leading to strong gains for VTGN stock. Moreover, with cash equivalents of roughly $83.7 million and effective expense management, the business has enough liquidity to continue funding its research and development costs.
Biotech Stocks: BioNano Genomics Inc (BNGO)
Source: Dennis Diatel / Shutterstock.com
BioNano Genomics Inc (NASDAQ:BNGO) caught most investors’ eyes after it became a meme stock and climbed over 1,500% in value within a couple of months in February 2021. However, in the past six months, the stock has had a rough outing in the market. Despite its risks, it has catalysts that could turn things around for its business in the coming years.
Its flagship product is its genome imaging tool called Saphyr. It allows healthcare professionals to save costs and time in detecting and analyzing genomes. The product retails for roughly $150,000 and includes various consumables. These add-ons include reagents, data analysis tools and chip consumables, which can offer a recurring income stream for the enterprise. An encouraging figure is that the installed base for Saphyr systems was up 64% during the first quarter to 176.
Verastem (NASDAQ:VSTM) is a Massachusetts-based biotechnology startup that develops cancer treatments. The company is looking to make inroads in treating ovarian and lung cancers. It has laid out plans to further the development of its lead compound, an oral drug called VS-6766. It plans to report several data readouts highlighting the drug’s potential across tumor types and mutations. The goal is for the drug to become the best-in-class RAS pathway product.
Verastem revealed results for a Phase I/II study in treating ovarian cancer, which showed a 46% partial response rate. Moreover, it has also partnered with Amgen (NASDAQ:AMGN) to evaluate the impact of VS-6766 in treating a particular type of lung cancer. 2022 could potentially be a breakthrough year for VSTM stock for big gains.
Biotech Stocks: BioCryst Pharmaceuticals (BCRX)
Source: Dennis Diatel / Shutterstock
BioCryst Pharmaceuticals (NASDAQ:BCRX) is a North Carolina-based pharma business best known for developing its antiviral influenza drug called Peramivir. Additionally, it is also working on Galidesivir, an antiviral drug to treat rare illnesses, such as Yellow Fever and Zika. It launched an oral treatment for hereditary angioedema during the first quarter called Orladeyo.
The biotech focuses on developing a rare disease drug portfolio, often ignored by top pharma companies, which could generate millions in revenue. The market for such drugs is typically small, but it also attracts significantly less competition. Moreover, in its first quarter, its sales doubled to $49.7 million, a 161% bump in sales from the same quarter last year. If it can continue on this upward trajectory, it could be looking at an incredible road ahead.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines
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