Pharma stocks and massive potential are synonymous. With horrible diseases like cancer, diabetes, and heart disease still a mile away from developing a cure, drugs that address these conditions command outrageous prices. Hence, any company creating a new drug to manage it and subsequently get FDA approval results in stock prices soaring faster than SpaceX’s Starship.
Suppose you look at some pharmaceutical companies and review how the markets reacted. You might find examples like how the market responded to Stride Pharma’s FDA approval of its seizure drug and 60 Degrees Pharmaceuticals after announcing its pivotal clinical study of tafenoquine in hospitalized babesiosis patients. The industry is packed with potential opportunities for a high-returning portfolio. In this article, we have curated a list of three pharmaceutical stocks that could boost your portfolio for 2024.
Pharma Stocks: Vericel Corporation (VCEL)
Vericel Corporation (NASDAQ:VCEL) is a sports medicine and severe burn care pharmaceutical company specializing in cell therapy and biologic products. These products include treatment for cartilage defects and skin replacement using Epicel cultured epidermal autografts. The company also has North American rights for NexoBrid (anacaulase-bcdb), a drug intended for eschar removal in adults with partial to full-thickness burns. Verticel has previously published positive results on its NexoBrid treatment with positive results.
The company has recently released its preliminary full-year results with its unaudited fourth quarter and full-year financials. According to its announcement, the company anticipates a 20% growth in its full-year total revenue and a 23% growth in its fourth-quarter performance. VCEL also reported net revenue growth of 25% for MACI® and 31% for Burn Care.
According to its preliminary release, the company is in its 14th quarter of positive operating cash flow and adjusted EBITDA. With its strong foothold on the market and another potentially solid quarter, VCEL has a compelling case of being a strong candidate for your following pharmaceutical stock to buy.
Eli Lilly and Company (LLY)
Eli Lilly and Company (NYSE:LLY) is a pharmaceutical company that specializes in drug manufacturing. Its main product lines cater to various patients in oncology, immunology, neuroscience, and diabetes. Some of its main products are Cymbalta®, Adcirca®, Humulin®, Mounjaro®, and Yentreve®, just to name a few. The company has recently completed its acquisition of POINT Biopharma to help diversify its product portfolio. Also, the launch of LillyDirect™ puts the company’s product closer to consumers’ grasp and assists with an end-to-end digital healthcare experience with the pharmacy fulfillment service.
The company reported its Q4’23 earnings on February 6. Q4 EPS came in around analysts’ consensus and grew 13% to $2.42 (reported), with 2024 revenue guidance from $40.4 billion to $41.6 billion.
Lilly has a pipeline of drugs in development. One includes AK-OTOF, a gene therapy designed to treat sensorineural hearing loss due to mutations in the otoferlin gene (OTOF). The company reported their first test patient for the therapy, an 11-year-old boy whose hearing was fully restored after 30 days of treatment.
If we look at analyst ratings, even they are optimistic with LLY based on their “Strong Buy” recommendation. So, if you are looking for pharmaceutical stocks, LLY should be on your watchlist.
Merck & Co., Inc. (MRK)
Merck & Co., Inc. (NYSE:MRK) is a global healthcare solutions company that provides various healthcare products through its prescription medicines, vaccines, biological therapies, and even animal products. Its operations are divided into human health for therapeutic and preventive agents and animal health for its veterinary pharmaceutical and vaccine products. The company has been making strategic acquisitions to expand its product portfolio, like its proposed acquisition of Harpoon Therapeutics and Caraway Therapeutics, which will help diversify its oncology and degenerative diseases pipelines.
Merck’s Q4’23 financial results demonstrated its strong financial performance with its 6% worldwide sales increase on a YoY basis and strong sales growth notable from KEYTRUDA, which grew 19% YoY. In addition, products like GARDASIL/GARDASIL 9 grew by 29%. Its collaboration with Daiichi Sankyo for three clinical-stage ADC candidates, alongside its approvals from the FDA, puts MRK in a strong position for further growth.
With its sustained growth, promising pipelines, collaborations, and more robust performance in oncology and vaccines, there is no doubt that Merck is one of the top pharmaceutical companies to buy for 2024.
On the date of publication, Rick Orford 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.
