Investing in biotech stocks is not everyone’s cup of tea. A lot of it is because of the volatility that comes with investing in them.
The reason for the volatile swings in biotech stocks is that they tend to trade on catalysts. The outcomes of trial data, regulatory approvals, and other company data are crucial in pushing the stock higher.
Investors need to be aware of the key dates to pounce on the next major catalyst. The worst outcome for them would be if they are caught off-guard or have an ineffective exit strategy.
The beginning of the year is typically the prime time for trial data to be released and for the Food and Drug Administration (FDA) events. That said, the summer is also a critical period for drugmakers to make an impression on the regulators.
The next few months will have several key events for numerous biotech companies and their shareholders. The three biotech stocks with the most promising upcoming catalysts include the following:
- Bristol-Myers Squibb (NYSE:BMY)
- Sanofi (NYSE:SNY)
- Mirati Therapeutics (NASDAQ:MRTX)
Biotech Stocks To Buy: Bristol-Myers Squibb (BMY)
Bristol Myers Squibb is one of the top pharmaceutical companies in the world. With its acquisition of Celgene, it became biotech, primarily focusing on cancer.
It has an array of cancer drugs in its pipeline, including Opdivo, Yervoy, Pomalyst, Revlimid and others. Moreover, its oncology drugs account for roughly 66% of its sales or more than $27 billion in the past year.
Therefore, the catalysts related to its cancer portfolio are critical to its bottom line and the growth of BMY stock.
The company has a wide range of drugs currently in phase 3 trial stages. Some of these include Reblozyl, Opdivo, Cabometyx, Abecma, Bempeg.
If it can successfully steer these drugs from the trial stages toward commercialization, it could be looking at a multi-million dollar sales opportunity for each drug.
BMY is an outstanding value stock and boasts a remarkable dividend profile. It has a healthy dividend yield of roughly 2.9%, with 5-year growth of 4.9%. Looking ahead, the stock has immense potential to make it big this year and continue its spectacular form into next year and beyond.
French pharmaceutical giant Sanofi has been in the news for its Covid 19 vaccine efforts, recently reporting positive phase 2 trial data.
It is late to the party, though, as the first movers have taken the major market share.
However, Sanofi’s enzyme replacement therapy (ERT), for Pompe disease called avalglucosidase alfa, has investors salivating over SNY stock’s prospects.
Pompe is a rare genetic disorder that occurs when the body fails to develop a protein that could break down complex sugars for energy. There is no drug for the disease, but ERT treatment is an effective option in tackling the problem.
The FDA has set a new review date at Aug. 18 for avalglucosidase alfa. It was initially scheduled for May 18 but was later extended by three months. Sanofi hasn’t talked much about the pricing of the treatments.
It made $1.1 billion in ERT medication sales in 2020, which it could easily trump with the approval of avalglucosidase alfa.
Biotech Stocks: Mirati Therapeutics (MRTX)
Mirati Therapeutics is a leading pharmaceutical company that produces smart medicines to serve the unmet needs in various cancers.
It delivers novel cancer treatments which effectively fit the patient’s genomic profiles. The company is looking to commercialize a drug called Adagrasib, which has exhibited strong efficacy in treating non-small cell lung cancer.
The company is not alone in the race in treating KRAS G12C mutation-positive cancers. Amgen (NASDAQ:AMGN), for instance, is also looking to commercialize a drug to tackle the mutation.
However, Mirati can be more effective in the long run and illicit a greater response than Amgen’s drug in its tumor reduction ability. Hence, MRTX stock has an incredible growth runway ahead and the potential to make a big splash this year.
Note: This article originally appeared at InvestorPlace.
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.