This story originally appeared on Best Stocks
Biotechnology is gradually advancing the way we know life to be. This advanced technology brings us closer to a world where humans and robots share our space. An increasing number of biotech advancements are on the rise, promising us a great future. This market has been booming in the past few years, with companies developing new drugs, treatments, and cures for a wide range of diseases, including the advance of the Covid-19 vaccination.
An industry that is so important nowadays has seen a lot of growth and investment. Companies in the biotech industry are constantly rebranding themselves to stay competitive. As more and more companies enter the field, we’re seeing some big players consolidate positions in their respective industries at the expense of smaller companies. For biotech investing to remain lucrative, investors must be willing to risk these smaller companies with unproven technologies.
As a result of this fast movement and innovation, they are in high demand and today’s biotech stocks are highly volatile. As a result, there has been a significant drop in biotechnology-related investment funds in recent months, which has worried investors. However, biotechnology is still a booming sector despite the decline in recent months. In this article, we explain the reason for this drop, why it is still worth investing in biotechnology best stocks, and which are the best investment funds to bet on in 2022.
Table of Contents
The Position of Biotechs on Stock Market
The biotech industry is booming and should continue growing for years to come. The growth is because the technology and science of biotechnology have advanced to a point where it’s been able to make vaccines, diabetes treatment, organ transplants, and more possible.
Biotech stocks offer a high return on investment and are always in demand. This increased demand makes them an excellent choice for investors. Biotech stocks are also highly volatile, meaning that the price can rise or fall significantly within short periods. Stocks in biotech companies are not just affected by their company’s performance; the market as a whole affects how they perform as well. Man
However, in 2022 there are signs of trouble brewing in this sector. Some of the significant biotech investment funds closed lower in the first month of 2022. For example, the iShares Nasdaq Biotechnology ETF (IBB +1.2%) closed in January 2022 with a significant drop of 13.6%. The SPDR S&P Biotech ETF (XBI +1.3%) and ARK Genomic Revolution (BATS: ARKG) ended the month down 19.1% and -28.6%, respectively, surprising all their investors
Some analysts say that this drop may be influenced by the fact that many of these funds have their products mainly aimed at solving Covid-19. With the advancement of vaccination worldwide, even with the advent of variants such as Ômicron, there is currently a lack of demand for vaccines on the market. The overvaluation of the biotech sector and the decline of the pandemic may have affected its performance in the stock market at the beginning of the year.
Biotech Stocks are Growth Stocks
Biotechnology stocks are classified as growth stocks. This means that they are companies whose revenues tend to increase and stay high. It is also used by investors who look for companies that have a positive outlook on their future prospects. These investments typically provide stability through stable growth over time.
Growth stocks are stocks that are poised for rapid and significant growth due to an improvement in their performance over the course of several years. They have the potential to increase significantly in price over a period of time, but they often come with a higher risk as well. This fact requires people to take a more thoughtful approach to invest.
More importantly, biotech stocks can offer a great return on investment when they grow and succeed. After all, these types of companies are constantly looking for new ways to treat diseases and help those suffering from them. They can go up as well as down in a matter of days.
This volatility is due to the considerable uncertainty of the biotech industry. Many of these stocks may seem expensive based on their quarterly earnings, but they are also risky investments because many of these companies have limited data and don’t have any long-term track record.
Despite all the tension involving the high volatility of this industry on the stock market, the trend is that things will improve throughout the year and that these investments made now at the beginning of the year will be worth much more in the future since biotechnology is a sector that is always growing and innovating.
Reasons to Buy Biotech Stocks in 2022
The biotech industry has experienced a large amount of growth in recent years. The attraction is not just because of the opportunities available but also because of the high-profit margins. Biotech stocks have had a significant impact on the stock market.
The future success of these companies depends on which drugs will be approved by the FDA, and their patents will ultimately expire. This means that new competitors can come in and provide cheaper alternatives for patients to choose from. To keep up with this increasing competition, biotech companies now have to work harder than ever to stay ahead of the game. That’s why investing in biotech stocks is essential for your portfolio decisions moving forward.
Biotechnology companies are involved in the research and development of new life-saving treatments and medical devices. They are also investing heavily in regenerative medicine to help recover our environment’s health. This has created a lot of excitement in the biotech market, leading to a surge in quarterly earnings for the industry.
Some investors like to buy biotech stocks because they believe the market will grow even more over time. Others may be attracted to them because they can make money from short-term fluctuations. What is the reason to buy biotech stocks in the current year? What are the best stocks to buy now?
A Global Need
A big reason biotech stocks are on the rise is because more and more people around the world need these types of treatments and products. As demand rises, so does an investment in this industry. The United States, China, Japan, France, India, Brazil, Taiwan, and Canada all have a strong presence in this sector of the economy, which makes it one of the fastest-growing sectors globally. With the ascension of COVID-19, we have seen the importance of this industry to all the countries around the globe.
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Biotech Industry Have Strong Potential
Established biotech firms have large cash reserves, strong earnings growth, and extensive pipelines. Established biotech companies are those that are publicly traded on the stock market and have annual revenues of over $1 billion and a price/earnings ratio of over 20. In other types of organizations, these companies generally employ a large number of people and are well established, often enjoying substantial profit margins and advantageous financing terms.
An Investment Focused on Research and Development
Since the first biotech company was founded in 1898, the biotech industry has grown tremendously. From the introduction of recombinant DNA technology to advancements in genomics, this industry has evolved into a $1 trillion global market. Now, with new breakthroughs happening every day and increasing demand for new treatments for diseases, this industry is expected to grow even further.
Strategies to Invest in Biotech Stocks
Biotechnology companies have a great reputation for being able to produce the next big breakthrough in the medical and healthcare industry. Not only can they help in curing diseases, but they are also continually on the lookout for new treatments, cures and technologies. Investing in biotechnology companies can be risky, but also profitable if you know how to make the best decisions.
Know the Difference Between Biotech and Pharmaceutical Companies
Biotech companies are different from pharmaceutical companies because they aren’t focused on making drugs. Instead, they work to find new ways of treatments that can be used in medicine. They are often referred to as “life sciences” companies. Biotechnology is the area of science that deals with living organisms and their components, such as cells, genes, and proteins.
Biotechnology is the production of biological organisms or products using modern biotechnology, usually in a laboratory. Biotechnologists use this process to discover and develop new raw materials, medical treatments, and ways of improving agriculture and industry.
Pharmaceuticals are chemicals that are used as medicines to cure or prevent disease. They can be manufactured through various means, including chemical synthesis, fermentation, bioreactor manufacture, plant extractions, and fermentation from microbes.
To find the biotech stocks that can be profitable, you should study the market and investigate stocks to buy now if the company you are betting on has a very good chance of creating real value. The first thing you need to do is conduct thorough research on a company’s past performance as well as its products and marketing. You need to know what the future of the company is so you don’t end up losing a lot of money if something goes wrong.
The biotechnology market has the potential to increase its value by up to $5 trillion. With that in mind, it’s no surprise that investors have a lot of money at their disposal. What is a surprise is that some investors are struggling to find high quality projects to invest in. Identify high-quality biotechnology projects before they become too expensive, so you can ensure your investment capital goes where it’s needed most: research and development.
Make Sure the Product has a Market.
Now, To reduce the risks of losing money in the stock market, you should focus on investing in biotech companies that already have a solid financial position in the market. Companies that have already sold many of their products and continue to grow are more likely to be more profitable. The risk of investing in unprofitable biotech companies is that they may not have the financial means to continue their studies on a regular basis.
One way to ensure that your investment will pay off is by finding out whether or not the product has a market because no one wants to lose their hard-earned money on an idea that has already been done before and doesn’t have any potential on the horizon.
When a company has a strong financial position, its future is more secure. This is because they have the capital needed to invest in building new technologies and expanding their brand. While it can be tempting to focus on companies with high growth rates, investors should consider investing in financially stable companies as well. There are many biotech companies that have shown steady growth in recent years, providing investors with an opportunity to benefit from these companies. In addition to looking for companies with strong financial positions, investors should also consider looking for those who are at the forefront of technological innovation as well.
The biotech market cap is an important indicator that measures the value of a company that’s involved in biotechnology research and development. It is generally expressed as the number of shares traded by the company divided by its market capitalization. If you’re looking to invest in biotech stocks, you should know what the benchmark for such stocks is before jumping into the industry.
10 Best Biotech Stocks to Buy in 2022
As biotech stock prices continue to fluctuate, investors are left wondering how the market will fare in the future, and The instability of biotech stocks in early 2022 leads us to look at the best biotech stocks to invest in and earn returns once the market stabilizes again. We’ll reveal their market capitalization and primary focus.
Axsome Therapeutics (NASDAQ: AXSM)
Market capitalization: $1.08 billion
Primary Focus: Neuroscience
Axsome Therapeutics is a biotechnology company that focuses on developing novel drugs for the treatment of rare and orphan diseases. It is primarily involved in the discovery, development, and commercialization of RNA-based Therapeutics. The company has been granted Orphan Drug Designation by the FDA for its lead product candidate, AXS1002, which is designed to treat patients with hyperphosphorylated tau protein (HPSPT), an abnormal accumulation of tau protein.
Axsome Therapeutics currently produces three products in the United States, Canada, and Europe. The company recently announced a fourth product (the Finta drug) that will be available for sale this year, offering a wide range of therapeutic options for both CNS and pain management applications.
With a diversified portfolio that includes more than 100 patents, Axsome has many ways to make money for its shareholders. In addition to this strong intellectual property portfolio, Axsome also has a strong pipeline of product candidates with early-stage clinical data.
BioNTech SE (NASDAQ: BNTX)
Market capitalization: $42.56 Billion
Primary Focus: Neuroscience
BioNTech SE (NASDAQ: BNTX) is a leading provider of diagnostic tests and services to aid in the diagnosis, treatment, and prevention of diseases. With more than 8 million tests performed annually, BioNTech SE has the most comprehensive range of offerings across its diagnostic platforms. Its portfolio includes over 30 different tests covering areas such as diabetes, thyroid, cholesterol, cancer, HIV/AIDS, and hepatitis.
The company has a long history of providing innovative solutions to the medical industry. The company provides a wide range of high-quality molecular tools and services that are used in numerous industries around the world. BioNTech SE is dedicated to developing new therapies and treatments, and it has done so successfully time after time.
In addition to providing its own products and services, BioNTech SE provides outsourced testing through its Diagnostics Outsourcing division. This division provides outsourcing for a large number of diagnostic tests for customers in need of clinical diagnostics at a low cost. The company also offers a managed care program that’s designed to help health plans achieve quality results at lower costs. It also has an extensive network of integrated practices that serve patients across the US and Canada in over 25 states and 14 countries from offices located in North America.
Adagio Therapeutics Inc ( NASDAQ:AGI)
Market capitalization: $888.90 Million
Primary Focus: Cardiovascular Diseases, Diabetes.
The company’s lead compound, ADAGIO, is an orally administered peptide drug candidate currently being evaluated in phase 2 and 3 clinical trials for acute myocardial infarction (AMI) and heart failure. Adagio Therapeutics Inc. is headquartered in San Diego, CA, with international operations in Shanghai, PRC, the United Kingdom, and Japan. In the last five years, Adagio has consistently outperformed the Nasdaq Biotechnology Index by over 150%.
Adagio Therapeutics Inc. is a biopharmaceutical company focused on cardiovascular disease and diabetes. Founded in 2004, the company completed its initial public offering in 2014 and reported $724 million in revenue. The company has also been given notice of its being named to the NASDAQ 100 for 2019.
As a result, shares are trading at an all-time high. Adagio Therapeutics is expected to show revenues of $1.10 billion by 2020. Investors should take note as the company looks to increase both sales and revenues with new products and partnerships coming into play.
Exelixis( NASDAQ:EXCEL)
Market capitalization: $5.7 billion
Primary Focus: Cancer
Exelixis (NASDAQ: EXEL) is a multinational company with its headquarters in Dublin, Ireland. It specializes in respiratory diseases and the treatment of other serious conditions such as lung cancer and chronic obstructive pulmonary disease (COPD). Exelixis has been at the forefront of developing new treatments for these complex diseases. The company’s primary focus is on aiding patients with COPD and lung cancer.
The Exelixis Corporation is a clinical-stage biotechnology company that focuses on the development of novel RNAi therapeutics. Their therapeutic portfolio consists of daratumumab, which is currently in Phase 3 clinical trials for hematological malignancies and will soon be submitted to the FDA.
Daratumumab was designed to bind with CD19, a cell surface protein found on B cells, T cells, and some blood stem cells. Daratumumab prevents the maturation of immature B-cells into functional B-cells. Daratumumab also targets CD22, a protein expressed on the surface of most white blood cells, and protects them from death-inducing signals released by activated T-cells.
The Exelixis pipeline includes other programs in various stages of development, including their most advanced program, EXMARKER, which is a personalized medicine drug candidate that has shown promising results in multiple Phase 2 studies.
Pacific Biosciences of California Inc (NASDAQ: PACB)
Market capitalization: $2.44 Billion
Primary Focus: Bioinformatic
Pacific Biosciences of California Inc (NASDAQ: PACB) is an American company that provides molecular biology, protein, and gene analysis services to the pharmaceutical, biotechnology, and diagnostic industries. They provide molecular biology, protein, and gene analysis services to the pharmaceutical, biotechnology, and diagnostic industries.
The company operates in two segments: clinical diagnostics, which includes a range of laboratory services from routine testing to complex clinical research, and custom diagnostics, which offers bioinformatics for drug development. As of December 31, 2017, the company had over $142 million in cash and equivalents.
Pacific Biosciences has been developing its platform since 2010 and completed phase 1 trials for its lead product in 2014. Their lead product is called Alkaptonuric Acid. Alkaptonuria acid is a drug that works by inhibiting a protein called phosphatidylinositol 3-kinase (PI3K). This protein plays a role in tumor development and metastasis.
In addition to Alkaptonuric acid, the company also has two other candidates in the pipeline that are nearing the completion of phase 2 trials. The other products are designed to target certain proteins involved in cancer treatment that may be resistant to standard therapies. The company’s scientific team also developed an Alkaptonuric acid delivery system.
Vertex Pharmaceuticals (NASDAQ: VRTX)
Market capitalization: $59.5 billion
Primary Focus: Rare diseases, diabetes
Vertex Pharmaceuticals is a biotechnology company that specializes in developing and commercializing treatments for rare diseases like cystic fibrosis, rheumatoid arthritis, hepatitis C and other infectious diseases.It began as Merck’s drug discovery and development subsidiary but was spun off in 1989.
Vertex has been involved in the development of drugs to treat over 40 different diseases, including cystic fibrosis, hemophilia A and B, myotonic dystrophy type 1, and Alzheimer’s disease. The company has operations in the United States, Europe, Canada, Japan, Australia, and Asia. The company’s lead products include VX-809 and VX-661. Investors can buy shares on the NASDAQ exchange.
Novavax, Inc(NASDAQ: NVAX)
Market capitalization: $8.4 billion
Primary Focus: Infectious diseases
Novavax, Inc. (NASDAQ: NVAX) is a biopharmaceutical company that has been developing vaccines to prevent and protect against infectious diseases. It started as a biotechnology company named Aptevo Therapeutics in 2007 when it was acquired by Novavax in 2010. To develop their vaccine, they have been using the technology of recombinant DNA.
The company produces three vaccines: Prevnar 13 (pneumococcal conjugate vaccine), which protects against pneumococcal disease; Serovar Xilumazole (HSV-2 vaccine), which protects against herpes simplex virus 2; and VaxiGard, which protects against varicella-zoster virus, more commonly known as chickenpox. In their most recent financial quarter, the company accounted for about 20% of its total revenues from Prevnar 13 and about 45% from VaxiGard.
Novavax has been classified as a small-cap stock by Standard & Poor’s. In addition to vaccine sales to third parties, the company sells its immunobiological through its own direct sales force or through partnering arrangements with distributors, wholesalers, Philantrophy organizations, or other companies in various countries around the world.
Regeneron Pharmaceuticals(NASDAQ: REGN)
Market capitalization: $66.2 billion
Primary Focus: Autoimmune diseases, cancer, eye diseases, infectious diseases
Regeneron Pharmaceuticals, Inc. is a multinational biotechnology company based in Tarrytown, New York, with manufacturing facilities and offices in North America, Europe, Asia and Australia. The company was founded in 1988 by a group of scientists. In 1990, the company obtained FDA approval to market its first drug, fludarabine phosphate.
In 2008, the company’s sales reached $1 billion for the first time. As of April 2016, the company had sales of $11 billion. Here are some ways to help you learn more about Regeneron Pharmaceuticals’ business model and future plans. Regeneron sells pharmaceuticals for the treatment of rare diseases and complex medical conditions. The company had total revenue of $1.2 billion in 2016.
Regeneron has been developing and marketing products for over 30 years. Over the past decade, they have focused on rare diseases with high unmet medical needs that require new drug therapies and complementary diagnostics to address the lack of treatment options. They are working to transform the way these diseases are treated through our research pipeline and expanding into new markets across all therapeutic areas.
AbbVie (NYSE: ABBV)
Market capitalization: $248.37 Billion
Primary Focus: Chronic Diseases
AbbVie is a biotechnology and pharmaceutical company that was founded in 2013. It was established to create new medicines, devices, and treatments for chronic diseases. AbbVie’s headquarters is located in Illinois, USA. With its headquarters in Foster City, California, AbbVie has offices all over the world.The company is based on research that combines the fields of biology, chemistry, and computer science.
One of their most successful drugs is Humira which won them FDA approval in 2002. AbbVie develops, manufactures, markets, and distributes pharmaceuticals. It is a leading global biopharmaceutical company that develops and commercializes therapies for oncology, immunology, infectious diseases, nephrology, and neurology in areas of unmet medical need.
This company has a portfolio consisting of four marketed product lines and three pipeline products with an emphasis on developing breakthrough treatments in specialty areas that can improve patient outcomes. AbbVie has a market capitalization today of $171 billion. They have been included on the Forbes Global 2000 list of companies as well as the Fortune 500 list of US companies.
Twist Bioscience (NASDAQ: TWST)
Market capitalization: $2.97B Billion
Primary Focus: Chronic Diseases
Twist Bioscience (NASDAQ: TWST) is a biotech company that specializes in developing and commercializing regenerative drugs to treat diseases of the gastrointestinal tract. Its lead product, Nexabio, is approved for commercial sale in more than fifty countries around the world and has received regulatory approval in the United States.
In addition to its lead product, Twist Bioscience also has several other products in clinical trials, including NexuBiotic, an antibiotic, and Zevalin, a cancer-fighting drug. As of December 31st, 2016, Twist Bioscience has approximately $23.7 million cash on hand, and their shares are traded on NASDAQ under the symbol TWST.
The company was founded in 2006 by Dr. Tom Burke, who has over 20 years of experience in the Life Science industry. Dr. Burke’s vision is to create “life science breakthroughs” and help patients through clinical trials and product development so they can live better lives.
Bottom Line
Biotechnology is gradually but surely changing lives. We are closer to a world where robots and humans coexist. We are seeing an increasing number of biotechnological advances that promise a bright future. This market has seen a boom in recent years, with many companies developing new treatments and drugs for a variety of ailments.
Despite recent declines, biotechnology remains a thriving industry. Investors must be ready to take a chance on smaller companies with unproven technology if biotechnology investment remains profitable. We are seeing some large companies consolidate positions in their specific industries at the expense of smaller companies as new companies enter the field.