The 3 Best Biotech Stocks to Buy Now: Q2 Edition

Stocks to buy

Some of the hottest opportunities can be found in biotech stocks to buy now.

With innovation, mergers and acquisitions, major companies looking to replenish their pipelines ahead of patent expirations, treatments for obesity, aging baby boomers, and demand for better care are creating massive opportunities. We’re even seeing big opportunities in cancer treatments known as ADCs (antibody-drug conjugates), and in gene-editing.

We can even look at the impact artificial intelligence could have on healthcare.  Look at drug discovery, for example. At the moment, it can take 10 years, and upwards of $2 billion to develop a new drug. Plus, designing new drugs isn’t easy.  

When creating a new drug, you need to identify a molecule that balances a large number of anti-correlated properties, including potency, selectivity, solubility, bioavailability, clearance/ half-life, permeability, drug interactions, and synthesizability. Even then, drug development has a high failure rate of 90% — which is ridiculously high. However, with artificial intelligence the rate of failure could drop, and the design of new drugs could become far easier.  

In short, there’s a lot to get excited about with biotech – especially with biotech stocks like:

Agios Pharmaceuticals (AGIO)

Source: shutterstock.com/Champhei

Agios Pharmaceuticals (NASDAQ:AGIO) is a leader in PK (mutant pyruvate kinase) activation and is dedicated to developing and delivering transformative therapies for patients living with rare diseases, such as non-transfusion-dependent thalassemia, and sickle cell disease.

The company recently posted positive data for its pipeline of PK (mutant pyruvate kinase) activators for the treatment of non-transfusion-dependent thalassemia, sickle cell disease and clinical proof-of-concept in lower-risk MDS (myelodysplastic syndromes). It also expects to post data from a Phase 3 study of mitapivat in transfusion-dependent thalassemia, with a potential launch by 2025. All of which could be substantial upside catalysts for AGIO.

Analysts at Cantor Fitzgerald reiterated an overweight rating on the AGIO stock. In addition, at the end of 2023, some of the top hedge funds either opened or added to their positions in AGIO. That included Ken Griffin’s Citadel Advisors, which increased its stake in AGIO by nearly 158%. Paul Tudor Jones’ Tudor Investment also picked up 27,900 shares. 

Amgen (AMGN)

Source: Shutterstock

Investors may also want to keep an eye on oversold shares of Amgen (NASDAQ:AMGN). After diving from about $327.16 to a recent low of $265.51, it caught support dating back to late 2023. From here, I’d like to see it initially retest its prior high. Helping, there are a few key catalysts that could send Amgen higher. 

For one, the company expects to release Phase 2 data on its obesity treatment, MariTide later this year. Early trials found that “AMG 133 demonstrated weight loss in cell-based systems and animal models while improving metabolic markers. Further, in a phase 1 clinical trial in obese participants, AMG 133 showed an acceptable safety profile and significant, dose-dependent weight loss,” as noted by News-Medical.net.

Amgen also expects to release its Tezspire Phase 2 data in the first half of the year for the treatment of chronic obstructive pulmonary disease. It also expects to posted Phase 3 data this year on AMG 451 OX-40 for the treatment of atopic dermatitis.

Ocular Therapeutix (OCUL)

Source: Mongkolchon Akesin / Shutterstock.com

We can also look at Ocular Therapeutix (NASDAQ:OCUL), which is developing therapies for wet age-related macular degeneration (wet AMD), diabetic retinopathy, and other diseases and conditions of the eye. Its axitinib intravitreal implant, also known as OTX-TKI is in Phase 3 trials for the treatment of wet AMD.

“I believe the Company has made outstanding progress over the last several months, with the initiation of the Phase 3 SOL-1 study with AXPAXLI in wet AMD and successful financings that raised more than $440 million in gross proceeds from existing and new top tier health care investors,” added Pravin Dugel, MD, Executive Chairman of Ocular Therapeutix.

At the moment, some of its other treatments in various trials include Axpaxli for diabetic retinopathy (Phase 1-2 trials), Paxtrava for glaucoma and ocular hypertension (Phase 1-2 trials), OTX-DED for episodic dry eye disease (Phase 1-2 trials), and OTX-CSI for dry eye disease (Phase 1-2 trials).  

On the date of publication, Ian Cooper did not hold (either directly or indirectly) any positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Ian Cooper, a contributor to InvestorPlace.com, has been analyzing stocks and options for web-based advisories since 1999.

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