The biotech industry is constantly evolving due to being on the cutting edge of the healthcare industry’s research and development. Large biotech companies such as Johnson and Johnson (NYSE:JNJ), Merck (NYSE:MRK), and AbbVie (NYSE:ABBV) offer investors steady and continual growth as well as decent dividends. But, a large portion of the industry involves much more volatile stocks.
Many companies’ significant volatility in the biotech market attracts investors looking for a stock that will experience a massive rally. But, there is also a significant risk of investing in a company that could drop 50% in its share price in one day, for example. Most biotech and pharmaceutical stocks, especially smaller companies developing novel therapeutics news regarding FDA approval and the efficacy of their products in clinical-stage trials, will have investors flocking or fleeing a company.
Investors need to understand that the biotech market, for the most part, is very unpredictable, and too much exposure to one company has the possibility of large losses. It is best to proceed with caution.
Amgen (AMGN)
Amgen (NASDAQ:AMGN) is a large biotech company that develops and manufactures therapeutics for inflammation, oncology, cardiovascular disease, neurologic disorders, and many more. Amgen is headquartered in Thousand Oaks, California. Some of their most well-known products are Enbrel which treats rheumatoid arthritis; Neulasta helps prevent infection from chemotherapy; and Otezla, which helps treat psoriatic arthritis and psoriasis.
In March, the company announced its second quarter for 2023, which is $2.13 per share. On April 27, Amgen released its first-quarter earnings. Their total revenue saw a 2% decline year-over-year due to the Covid-19 manufacturing collaboration with Eli Lilly (NYSE:LLY). The company saw a significant decrease in sales year-over-year for one of its flagship products Enbrel which dropped by 33%, while other products, such as Nplate, saw an increase in sales within the same period of 36%. And the company has seen growing sales for its newest product Tezspire which treats patients with severe asthma. This make it one of those biotech stocks to buy.
Amgen is one of the largest biotechnology companies, with a market cap of $122 billion. Their stock has traded flat over the last year and has slowly decreased by 5% since their latest earnings report.
Roivant Sciences (ROIV)
Roivant Sciences (NASDAQ:ROIV) is a commercial-stage biopharmaceutical company based in London, United Kingdom. They develop and produce immunology, oncology, hematology, and dermatology medications. Roivant Sciences recently was given FDA approval for its medicated ointment that treats psoriasis called Vtama and has multiple other treatments in the pipeline within Phase 3 trials. This is one of those biotech stocks to buy.
The company was founded in 2014, and in late 2021, the company began trading on the NASDAQ. Over this last year, Roivant Sciences’ share price has grown by over 150%; this is primarily due to multiple different press releases referring to positive news regarding the process of their clinical-stage pharmaceutical products.
In its most recent financial earnings release, the company stated total revenue had tripled from the first quarter of 2022 to the first quarter of 2023. They also reported a net loss of 79% within the same period.
Arcturus Therapeutics (ARCT)
Arcturus Therapeutics (NASDAQ: ARCT), located in San Diego, California, is a company that provides RNA medicines and vaccines for rare respiratory and liver diseases. The company has developed STAR and LUNAR technologies, which are mRNA technologies that deal with vaccines.
The company’s share price has grown by 123% last year. Most of that growth was following their fourth-quarter earnings, which reported a 28-fold increase in revenue compared to Q4 2021, which resulted in a 74% increase in their stock price. On May 9, Arcturus released their first-quarter earnings with reported diluted EPS of $1.87 per share and 15 fold increase in total revenue from their prior year.
Early in June, the company was given a fast-track designation by the FDA for ARCT-810, a novel vaccine to treat ornithine transcarbamylase (OTC) deficiency, a urea cycle disorder.
On the date of publication, Noah Bolton 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.
