7 A-Rated Biotechs To Buy For The Long Run

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These companies are the next generation of biotechs

While this isn’t the end of giant pharmaceutical companies, there is a new generation of biotechs that have been able to advance rapidly due to the massive advances in computer technology in recent decades. These A-rated biotechs are part of that new generation.

The breakthroughs used to build big pharma R&D facilities that we know today are now showing up with smaller biotechs, albeit it with a more focused approach on specific methodologies and diseases. The industry has been slowly transitioning for decades now. And we’re starting to see the possibilities.

Two small, focused biotechs were launched into global headlines with their work on novel covid-19 vaccines. Not only did their research help save the world from covid, their supply and distribution was also top notch. Once vaccine production reached consistent levels, the entire biotech sector rose.

Some of these companies got their start in the great vaccine race. Others are doing similarly game-changing work in different areas. Here are seven A-rated biotech stocks that will influence 21st Century medicine:

  • Bicycle Therapeutics (NASDAQ:BCYC)
  • Avid Bioservices (NASDAQ:CDMO)
  • Enanta Pharmaceuticals (NASDAQ:ENTA)
  • Iveric Bio Inc (NASDAQ:ISEE)
  • Moderna (NASDAQ:MRNA)
  • Prothena (NASDAQ:PRTA)

A-Rated Biotechs for the Long Run: Bicycle Therapeutics (BCYC)

Headed by a 2018 Nobel Laureate, the UK-based Bicycle Therapeutics didn’t focus on diseases. Instead, it took a broader approach, finding the best way to deliver powerful antibody responses while causing as little residual damage to the body.

Many times, treatments for cancers or other systemic diseases mean the treatment can be very difficult for the body to tolerate. And after it does its job, the treatment may linger in the body, making the liver and kidneys work extra hard to expel it.

Bicycle’s novel class of medicines address these issues. Its applications can be used across a number of different pathologies, such as reducing bodily stress dealing with tumor treatment, for example.

It’s a development stage company, but if all goes as planned – and it is – this could be very exciting. BCYC has soared 210% year-to-date, but this market provides numerous great entry points, and it’s still a young company.

BioNTech SE (BNTX)

As I discussed in my intro, some of these promising next gen A-rated biotechs have already hit the big time. BNTX is one of them.

It is a Germany-based immunotherapy company that, like BCYC, has found a number of applications for its novel therapies.

You may know it as the company that paired with Pfizer (NYSE:PFE) to develop the world’s leading covid-19 vaccine. It was BNTX that was working on mRNA sequencing and applied it to a vaccine. That’s how the world received a viable vaccine in a remarkably swift amount of time.

Usually, it takes years of trial and error, tweaking formulations and dosages to get close to something that’s effective. Here it took less than a year.

The stock has skyrocketed 317% YTD, but that cash will be well spent in its ambitious pipeline. And it’s a good bet there are already big pharma companies lining up to partner with it.

A-Rated Biotechs for the Long Run: Avid Bioservices (CDMO)

While there plenty of biotechs out there looking to slay dragons, some investors would rather put their money on a sword maker than a dragon slayer. That’s CDMO.

Since 1981, CDMO has been making biopharmaceutical products made of mammalian cell cultures for biotechs and drug companies to use in their R&D work. And if there’s a boom in the biotech sector, you can be sure there’s also a boom in one of the leading companies that supplies cultures for those biotech companies.

What’s more, CDMO isn’t spending billions on approvals from federal organizations or spending years getting through drug trials. It’s a money making business right now.

The stock is up 164% YTD, which gives it a massive price-to-earnings ratio. But its earnings will catch up with its price over time and growth will continue.

Enanta Pharmaceuticals (ENTA)

Something you hear a fair amount in the science world is as revolutionary as biology was to the 20th century, so chemistry is to the 21st. Bioengineering, small molecule drugs, protein folding, immunotherapies and more are changing the way we see drugs and diseases.

ENTA is a chemistry-focused biotech that specializes in small molecule therapies for viral infections and liver diseases. And yes, covid is in its wheelhouse.

As we’ve seen in recent weeks, it’s not as simple to wipe out a virulent virus as it was when the world was smaller, and less connected. Now, one event on side of the world can carry ripples across the globe in a relatively short time. And viruses are highly adaptable.

ENTA has drugs in the pipeline and has significant partnerships with big drug companies on some of its trial medicines. Its stock has gained 96% YTD.

A-Rated Biotechs for the Long Run: Iveric Bio (ISEE)

One sector that’s getting more attention in recent years is biotechs that are focused – pardon the pun – on vision. As the population becomes older, there are a number of chronic and acute eye diseases that are gaining more attention.

Part of that is the aging of the baby boomers. Another piece is the fact that rising levels of diabetes also lead to more eye diseases. And the fact that both the Millennials and Gen Z are larger than the baby boomer generation means these challenges are going to get bigger, not smaller.

ISEE is developing treatments for a number of retinal diseases, including age-related macular degeneration (aka, geographic atrophy), the leading cause of sight loss and blindness in older individuals. The company has a number of ongoing trials. And there are only handful of biotechs working in this sector. All this adds it to the A-rated biotechs club.

ISEE stock has gained 110% year to date.

Moderna (MRNA)

This is another of the covid-19 moonshots. And like its fellow vaccine success story BNTX, MRNA is far more than just a vaccine company. Its specialty is finding ways to use messenger RNA (mRNA), the building block of DNA, to help the body build its own immune defenses against viruses, cancers and other debilitating and deadly diseases.

Consider its covid-19 vaccine a significant proof of concept for mRNA’s potential. And given the fact that massive amounts of investors have poured huge amounts of money into the stock – it’s up 187% year to date and has a market cap of $125 billion – it has plenty of money to go broad and deep in its mRNA R&D work.

This is the kind of funding and acceptance biotechs dream about. And it also launches the company into some pretty heady company. It’s one of the elite A-rated biotechs worthy of your attention.

A-Rated Biotechs for the Long Run: Prothena (PRTA)

When most people think about the kinds of diseases that keep them up at night, covid-19 excluded, there’s likely at least one on the list that’s a neurodegenerative disease, like ALS, Alzheimer’s or Parkinson’s.

Since 1969, PRTA has been researching and developing medicines in conjunction with big pharma partners or on its own. And thanks to better computing that has led to a better understanding of our brains and neuroscience, PRTA is leading the way in a new generation of treatments for neurodegenerative diseases.

While cures are always the goal, when dealing with such complex systems and agents, developing drugs to cope with these diseases more effectively is vital progress. The troubles of a major competitor’s recent Alzheimer’s drug also have boosted prospects for PRTA. The stock has gained a whopping 294% year to date, yet has a current PE of just 46.

This article originally appeared at InvestorPlace.

On the date of publication, Louis Navellier had long position(s) in BNTX and PRTA. Louis Navellier did not have (either directly or indirectly) any other positions in the securities mentioned in this article.

The InvestorPlace Research Staff member primarily responsible for this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.