One of the most important sectors in any country’s economy is the biotech sector. Picking under-the-radar biotech stocks is easier said than done because we do not see immediate results. These companies have to move past the clinical trials and then prove that their drug or treatment is effective and safe.

There are times when many of these candidates hit a dead wall, and the investment and research both go in vain. But if the company proves its worth, the rewards will be significant. This is why it takes a lot of time to move forward with a new product, and patient investors are certainly rewarded. I’ve identified three under-the-radar biotech stocks that have immense potential and a diverse pipeline that can generate gains. Here are three biotech stocks worth buying. 

Abbvie (ABBV)

With the market focusing on Novo Nordisk (NYSE:NVO) and Eli Lilly (NASDAQ:LLY), pharmaceutical giant AbbVie (NYSE:ABBV) isn’t getting as much attention as it deserves. The company has immense upside potential, up 7% YTD and 27% in the months. The stock is exchanging hands for $171 today and is a dividend stock worth holding on to for the long term. 

Abbvie is known for its impressive drug portfolio and a pipeline of drugs that could become blockbusters soon. Its biggest drug, Humira, generates $4 to $5 bi, and while competition is rising, Abbvie remains at the top. Despite the exclusivity to Humira, the company reported strong revenue. 

Like all the other biotech companies, Abbvie has also been under pressure but has managed to sustain growth. Besides Humira, the company’s acquisition of Allergan has brought Botox to its portfolio, which could be a long-term winner. Botox’s growing popularity worldwide has set Abbvie up for success. It manages to grow through mergers and acquisitions, which has helped expand its portfolio. 

Management has also raised its adjusted EPS guidance for the year to $11.13 to $11.33, higher than the previous guidance of $10.97 to $11.17. Abbvie has a dividend yield of 3.61% and has steadily increased its payout over the past decade. The market is optimistic about Abbvie’s future, and it looks like the stock is moving in the right direction. 

Pfizer (PFE)

Pfizer (NYSE:PFE) became a household name during the pandemic, and while many think that the company’s best days are over, I’d like to remind my readers that Pfizer is much more than the COVID-19 vaccine. Yes, the company has seen a dip in revenue due to a drop in vaccine demand, but this correction was due. The stock was trading as high as $59 in 2021 when COVID-19 was at its peak, but it has lost a lot of value since then.

Trading at $27 today, the stock is down 5% YTD and 23% in the past 12 months. Buying the stock at a discount is a chance to take home massive gains. It has a pipeline of over 100 candidates with 37 in late-stage development. This means the future could be bright for Pfizer. The company has moved on from the success of the Covid vaccine and it is time we move on too.

Pfizer generated massive cash from COVID-19 vaccine sales and has used the money. It purchased Seagen for $43 billion. Pfizer is a pharmaceutical company that focuses on cancer treatments, and with this acquisition, the management is aiming to double the number of patients treated by 2030.

Additionally, Pfizer is known for one of the best dividends in the industry. Its 6% dividend yield is impressive and the company has raised dividends for 14 consecutive years. Once growth begins, investors can prepare for a hike in dividends. 

Vertex Pharmaceuticals (VRTX)

Next on my list of under-the-radar biotech stocks is Vertex Pharmaceuticals (NASDAQ:VRTX), and this stock is a buy for several reasons. Known for the cystic fibrosis treatment, the company has expanded its portfolio to include gene-editing therapies. Trading at $468, VRTX stock is up 14% YTD and 34% over the past 12 months. 

The biotech company reported impressive first-quarter numbers with a revenue of $2.69 billion, a 14% YOY jump, and ended the quarter with $14.6 billion in cash. Its EPS came in at $4.76, and management has reiterated its guidance and is expecting double-digit revenue growth.

The first quarter sales of its cystic fibrosis treatment generated $2.7 billion, up 13% year over year, and it still is the only company that sells this treatment. Having done this successfully for a decade, Vertex Pharmaceuticals remains the only player. This is where it stands out from the competitors.  

Additionally, it has submitted applications for a triplet therapy that includes a molecular entity known as Vanzacaftor, and it could earn approval for it by the end of the year. Vertex spends a lot on research and development, and its dominance in the industry makes it one of the best biotech stocks to own right now. 

On the date of publication, Vandita Jadeja did not hold (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.

On the date of publication, the responsible editor did not have (either directly or
indirectly) any positions in the securities mentioned in this article.