American drug makers can generate gigantic profits, pushing their stock prices to great heights. The pharmaceutical sector is lucrative in general around the globe, while the space is very profitable in America in particular. The latter point is true because drug prices are often astronomical in the U.S. For example, the Institute for Clinical and Economic Review recently determined that two treatments for sickle cell disease could be worth as much as $2.05 million annually per patient. Given how huge the payout for a drug can be, investors can make a profit by buying biotech stock bargains. Companies whose ability to successfully market their drugs in the U.S. is being greatly underestimated by the Street. Here are three biotech stock bargains that are well-positioned to generate gargantuan profits for those who buy them.
Novavax (NVAX)
Novavax (NASDAQ:NVAX) stock has tumbled 5% year-to-date in 2023, but is down over 80% in the past 12 months. However, there is hope for NVAX stock to recover.
Despite forfeiting some shipments of Novavax’s Covid-19 vaccine, Canada agreed to maintain the original value of their contract and still pay the company nearly $350 million. I don’t think that the country would have made such a generous offer if it viewed the company’s shots as altogether useless or unimportant.
And with some studies showing elevated rates of myocarditis among the recipients of the RNA shots and some experts raising concerns about the general impact of the vaccines on the immune system, Canada’s continued interest in Novavax’s alternative shot make sense. Moreover, I expect many other countries to follow in Canada’s footsteps, making NVAX one of the biotech stock bargains.
ImmunityBio (IBRX)
ImmunityBio (NASDAQ:IBRX) stock has sunk over 50% so far in 2023.
The company discovered a protein that’s apparently a great treatment for a type of bladder cancer. Indeed, in a Phase 2 and 3 trial over 90% of those with that form cancer were able to avoid having their bladder removed.
However, the Food and Drug Administration has refused to approve the treatment. They claimed they found problems with the facilities of IBRX’s partners that were supposed to manufacture the protein. And indicating that the agency still has some doubts about the treatment’s efficacy, it did ask that IBRX provide addition data about the protein. Specifically, the agency wants more information about how long the treatment’s impact lasts.
Still, given the strength of the data on the protein’s efficacy, if IBRX can get its manufacturing partners to clean up their acts or find new partners, the treatment looks poised to become a blockbuster. And it shouldn’t be that hard for ImmunityBio to accomplish one of those feats.
Bionano Genomics (BNGO)
Bionano Genomics (NASDAQ:BNGO) stock has retreated nearly 60% so far this year. And yet signs continue to mount that the company’s optical genome mapping (OGM) technique of evaluating DNA is going to become very widely used as a diagnostic tool.
YouTube host Mr. Invest Alot recently reported that University Health Network (UHN), a group of hospitals in Canada, is extensively using Bionano’s OGM to diagnose blood cancers. More specifically, the hospitals are utilizing about 1,500 of Bionano’s flowcells annually. And in a few years, they intend to analyze 2,000-2,500 genomes annually at a cost of $400 each.
Also very positively for BNGO stock, Adam Smith the director of UHN’s Cancer Cytogenetics Laboratory, reported that there are at least ten of Bionano’s OGM analysis tools being used in diagnostic labs in Canada at this point. And, he believes that most cryogenetic labs in Canada will switch to utilizing OGM in the next two years. Smith’s statements indicate that Bionano’s tech is increasingly being used to diagnose cancer.
On the date of publication, Larry Ramer held LONG positions in BNGO and NVAX. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
