It has been a roller-coaster ride for the volatile biotech industry in 2021, which along with the pharma and drug industries, has been in the spotlight due to the coronavirus outbreak. With deadly emerging variants of COVID-19 creating havoc worldwide, the development of vaccines and treatments has been the primary underlying story of these sectors in 2021.
Needless to say, the companies that have been developing vaccines and other antibody treatments have had a stupendous run in the year. Biotech companies are running a race against time and currently evaluating every possible weapon in their arsenal to combat yet another surge in cases owing to the rapidly spreading Omicron variant. Any positive update in this regard has led to a massive surge in the share price of the respective companies and fueled the overall industry. The same trend is expected to continue, with booster doses of the vaccines becoming the need of the hour.
While the successful development of a vaccine for COVID-19 has been the highlight of the year, regular pipeline and regulatory events are now more or less back on track. Key new drug approvals and label expansions of prominent drugs sustained the momentum for some biotech companies. The FDA’s approval of Biogen’s Alzheimer’s disease (AD) drug, Aduhelm, in June, propelled the entire sector and put the spotlight on other companies as well that are developing AD drugs as investors are now optimistic about the prospects of these pipeline candidates.
Mergers & acquisitions have always taken center stage in the sector. However, the momentum somewhat slowed down earlier this year but is gradually picking up pace as pharma/biotech bigwigs constantly eye lucrative acquisitions to bolster their portfolio/pipeline and combat rivalry. While oncology and immuno-oncology are the key areas of focus, treatments for rare diseases and gene-editing companies also promise potential, making them lucrative investment areas. Merck recently acquired rare diseases-focused company Acceleron Pharma.
Many other biotech companies have done well in the year, apart from the ones riding the coronavirus wave. Approval of a key candidate, positive data readouts, encouraging pipeline progress and favorable regulatory updates can lead to a massive surge in the share price of a biotech company.
As the year is coming to an end, let’s do a quick recap of the outperformers in the biotech sector. Here we list five companies, which have seen their prices double over the year. These stocks currently carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
A chart showing the share price movement of the five stocks is given below:
Image Source: Zacks Investment Research
Moderna MRNA is riding high on the success of its COVID-19 vaccine, and the company has had an outstanding year so far. The company’s COVID-19 vaccine has witnessed robust demand following its authorization in multiple countries. Significant product sales have boosted the top line and the same trend is expected to continue as MRNA has advanced purchase agreements with multiple countries. The authorization for a booster dose in the United States for all adults is likely to bring additional sales.
Moreover, the company recently announced data that demonstrated that the authorized booster of its COVID-19 vaccine, mRNA-1273, increased neutralizing antibody levels significantly against the Omicron variant. Moderna is evaluating its multivalent booster and variant-specific booster candidates in phase II/III studies. However, the company continues to develop an Omicron-specific booster candidate amid the astounding increase in cases due to the variant. The Omicron-specific booster candidate will enter clinical study in early 2022.
Further, Moderna is developing several promising candidates as therapies and vaccines targeting oncology indications and rare diseases.
Shares are up 140.6% in the year so far against the industry’s 19.5% decline.
BioNTech SE BNTX is another company that has scaled the skies on the success of its COVID-19 vaccine, Comirnaty, which it has developed with pharma giant Pfizer and is based on its proprietary mRNA technology. Both the companies have led the race in record time for the successful development of this COVID-19 vaccine approved as a two-dose series to prevent COVID-19 in individuals 16 years of age and older in the United States. It is also authorized for emergency use in other age groups and countries. Sales have skyrocketed owing to the vaccine sales. The momentum is expected to continue with the pandemic gaining steam again on the Omicron variant leading to the requirement of a booster dose. Preliminary laboratory studies demonstrate that three doses of this COVID-19 vaccine neutralize the Omicron variant.
Apart from this, BioNTech aims to develop an mRNA-based malaria vaccine, and the initiation of a clinical trial is expected by the end of 2022. BioNTech is also advancing the development of a broad oncology pipeline, which spans multiple anti-tumor and immune-modulating approaches.
Shares are up 218.6% in the year so far.
Prothena Corporation plc PRTA, a clinical-stage company focused on developing novel therapeutic therapies for neurodegenerative diseases, has had a phenomenal run in the year, primarily due to its promising pipeline for AD.
Prothena’s wholly-owned programs include birtamimab for the potential treatment of AL amyloidosis and a portfolio of programs for the potential treatment of AD, including PRX012, which targets Aβ (Amyloid beta) and a novel dual Aβ-Tau vaccine. Another promising candidate is PRX005, which is also being evaluated for the treatment of AD. The candidate is an investigational antibody that targets tau, a protein implicated in diseases including AD. Prothena is developing a dual vaccine, which concomitantly targets key epitopes within both the Aβ and tau proteins. The dual Aβ-Tau vaccine is being developed for the potential prevention and treatment of AD. The successful development and commercialization of the candidates will be a big boost for the company and should propel growth.
Shares are up 292% in the year so far.
Dynavax Technologies Corporation’s DVAX performance in 2021 has been excellent as well. Its hepatitis B vaccine, Helpisav –B, maintains momentum for the company. Dynavax is also advancing CpG 1018 adjuvant as a premier vaccine adjuvant through research collaborations and partnerships. Current collaborations are focused on adjuvanted vaccines for COVID-19, plague, TDaP and universal influenza. Continued growth in market share and revenue for Helpisav –B, along with multiple positive data readouts for adjuvanted COVID-19 vaccine candidates demonstrating the capabilities of CpG 1018 to help drive efficacy and high levels of antibodies while maintaining a favorable tolerability profile, has boosted the stock and should propel growth further.
Dynavax’s shares are up 215.5% in the year so far.
Another company that has impressed investors this year is Intellia Therapeutics, Inc. NTLA, a leading clinical-stage genome-editing firm focused on developing curative therapeutics using CRISPR/Cas9 technology both in vivo and ex vivo. Intellia’s ex vivo programs use CRISPR to create therapy using engineered human cells to treat cancer and autoimmune diseases. These therapies promise potential. The pipeline progress has been impressive this year. Intellia recently dosed the first patient with NTLA-2002, its in vivo CRISPR/Cas9 genome editing candidate being developed as a single-dose therapy to prevent attacks in people living with hereditary angioedema (HAE). NTLA-2002 is Intellia’s second investigational CRISPR therapeutic candidate. The first investigational therapy of its kind, NTLA-2001 is an in vivo CRISPR/Cas9-based genome-editing candidate being developed as a single-dose treatment for transthyretin (ATTR) amyloidosis.
Shares of the company are up 130.2% in the year.
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Dynavax Technologies Corporation (DVAX): Free Stock Analysis Report
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