The biotech sector, under the life sciences umbrella, exited 2023 with 41 bankruptcies. This was not surprising given the disparity between biotech’s high-capital requirements and rising interest rates set by the Fed. Despite these challenges, some of the best biotech stocks show promise and resilience in a volatile market environment.
At the same time, smaller biotech deals became prevalent, accounting for $17 billion during 2023, per JP Morgan data. Another noticeable trend was the uptick in mergers and acquisitions (M&A), pointing to consolidation.
This is a boon for investors who bought in early, benefiting from the stock price hike of acquired companies. Year-to-date, the Nasdaq Biotechnology Index (NBI) flatlined at 0.24% but gained 3.74% over the last month.
With new product launches and potential rate cuts on the horizon, investors are keenly looking for the best biotech stocks to buy in June. Which stocks stand out in this promising yet challenging sector?
Protagonist Therapeutics (PTGX)
Protagonist Therapeutics (NASDAQ:PTGX) is a clinical-stage firm based in Newark, California. Its primary drug pipeline revolves around peptide-based tech to tackle rare diseases with limited treatments.
Although the Protagonist’s PN-943 failed to meet ulcerative colitis (UC) treatment expectations in 2022, the company has multiple drugs in its pipeline. The leading one is rusfertide (PTG-300), presently in Phase 3 trials, for treating rare blood cancer called polycythemia vera.
The company is developing oral peptide JNJ-2113 (PN-235) for treating moderate-to-severe plaque psoriasis, with positive results from the Phase 2b study. This is the most common type of psoriasis, affecting up to 8 million adults in the US alone.
Following the mass vaccinations for “covid-19”, researchers reported exacerbated cases of this inflammatory disease, suggesting this market is likely to expand. In May, Protagonist Therapeutics delivered its Q1 earnings report. It revealed an accumulated deficit of $570.5 million vs $216.16 million in total equity.
The company ended the quarter with $172.8 million in cash and cash equivalents vs $127.9 million in the year-ago quarter. Nasdaq’s forecasting data places PTGX’s average price target at $43 vs the present $29.81 per share, which is still under its 52-week high point of $33.34.
BridgeBio Pharma (BBIO)
The Californian BridgeBio Pharma (NASDAQ:BBIO) has a twist to its operations. Adopting the hub-and-spoke model, the company divided its research into subsidiary modules. Given the funding requirements and complexity involved in biotech research, BridgeBio can shift between programs as needed.
The commercial-stage company primarily develops gene-based therapies in the oncology (cancer) arena and other genetic-driven diseases. One is acoramidis (AG10) for treating transthyretin amyloidosis (ATTR), affecting older people’s heart and tendons.
Given the large elderly cohort in the West, the company expects billions in acoramidis sales, alongside Achondroplasia (bone growth disorder) treatment. BridgeBio identified over 8,000 genetic diseases that are yet to find therapeutic solutions.
In May’s SEC filing, the firm showed significant improvement toward profitability, having reported a $36.16 million net loss vs $142.7 million net loss in the year-ago quarter.
The present BBIO price of $28.98 is aligned with the 52-week average of $29.22, making it a solid pick for the best biotech stocks in June. Nasdaq’s forecasting points to the average BBIO target of $51.2 per share.
Intellia Therapeutics (NTLA)
Intellia Therapeutics (NASDAQ:NTLA) leverages CRISPR/Cas9 (gene editing) technology to treat genetic disorders. In addition to prospective therapeutics for specific diseases, the company holds IP rights for cutting-edge gene editing tech.
In other words, Intellia is to gene therapies what TSMC is to the semiconductor sector. For the second half of 2024 development, the company expects much from NTLA-3001 to treat AATD (protein deficiency) and NTLA-2002 for hereditary angioedema (manifesting in severe swelling).
The gene therapy market is one of the most highly anticipated, projected to grow by a CAGR of 19.6% by 2032. In May’s quarterly report, Intellia showed a net loss of $107.4 million vs the net loss of $103.1 million in the year-ago quarter. However, the firm’s total liabilities decreased from $250.8 million to $223.4 million for the same period.
Intellia Therapeutics currently has an accumulated deficit of $1.76 billion vs its equity worth $1.03 billion. The present price of NTLA stock at $23.32 puts it under the 52-week average of $31.11 per share. Nasdaq places the average NTLA price target at $64.73 per share.
On the date of publication, Shane Neagle 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.
