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FDA Favorites: 3 Biotech Stocks on the Verge of Major Approvals

The biotech industry has fallen on hard times over the last few years, no thanks to venture capital drying up, tighter regulatory conditions and the harsh reality of the post-pandemic healthcare environment. As a result, biotech breakthrough stocks fell out of favor with investors and were among the worst performers in the stock market. 

However, that all seems to be history this year as biotech stocks have begun to rebound due to a wave of FDA approvals, which started in 2023. In fact, over the last two years, the FDA has approved over 80 treatments, causing biotech stocks to gain momentum in the market. 

As the second half of the year begins, biotech breakthrough stocks are emerging as solid options for investors. This article highlights three biotech stocks on the verge of major approvals that could be worth adding to portfolios. 

Mind Medicine (MNMD)

MNMD stock: A scientist holding a test tube in a stock image. AI Recommended Biotech Stocks

Source: Shutterstock

Mind Medicine (NASDAQ:MNMD) is an American biopharmaceutical company based in New York. It specializes in developing treatments for brain disorders such as LSD anxiety and wants to become a global leader in the international biopharmaceutical space. 

Although a small-cap psychedelic therapy company, Mind Medicine has positioned itself as a major player in the local biopharmaceutical scene. Its recent breakthrough therapy designation approval from the FDA is a further testament to this. Early indications suggest that the treatment could replace current options, such as Johnson & Johnson’s (NYSE:JNJ) ketamine-based anxiety treatment. 

Mind Medicine’s LSD anxiety treatment will be advancing to Phase III trials later this year. It also has several other treatments in the pipeline, making it an ideal option for investors interested in biotech stock. 

The company has also performed adequately this year on the financial front. According to its latest quarterly report, its cash and cash equivalents are $252.3 million. 

Arcellx (ACLX)

DNA strand and Cancer Cell Oncology Research Concept 3D rendering. LIXT Stock

Source: CI Photos / Shutterstock.com

Arcellx (NASDAQ:ACLX) is an American clinical-stage biopharmaceutical company based in Redwood City, California. The company specializes in developing treatments for cancer and other autoimmune diseases. It has a wide range of promising treatments in the pipeline, making its status as a breakthrough biotech stock unquestionable. 

An example is its lead candidate, anitocabtagene autoleucel, a treatment for patients with relapsed or refractory multiple myeloma. Other leading treatments include CD123, a drug for treating relapsed or refractory acute myeloid leukemia (AML) and myelodysplastic syndrome (MDS). 

Perhaps more impressive is Arcellx’s ongoing partnership with Gilead Sciences (NASDAQ:GILD) to develop CAR-T therapeutics for cancer treatments. CAR-T therapies take a far superior approach to cancer treatments than traditional ones by “training” the immune cells to recognize and kill cancer cells. The results are also far more effective and do not involve invasive procedures like surgeries, chemotherapy and radiation exposure. 

Financially, Arcellx is performing well this year. According to its latest quarterly report, the company’s cash, cash equivalents and marketable securities equal $610 million. 

Beam Therapeutics (BEAM)

Photo of a dropper dropping liquid into a test tube. Symbolizes gene editing.

Source: CI Photos/ShutterStock.com

Beam Therapeutics (NASDAQ:BEAM) is an American biopharmaceutical company based in Cambridge, Massachusetts. It specializes in the field of gene therapies and genome editing, an exciting industry with massive potential in the larger biopharmaceutical space. The work that Beam Therapeutics is doing is simply phenomenal and its involvement with gene therapy and editing makes it a high-stakes prospect. 

Beam Therapeutics takes an innovative approach to gene editing, combining prime editing with CRISPR to achieve greater results. Thanks to this approach, the company can carefully target the cause of hereditary genetic disease and prevent the negative effects usually associated with genome editing. Its BEAM-302 drug is further proof of this as it helps to accurately correct the underlying cause of a severe alpha-1 antitrypsin deficiency (AATD). 

Furthermore, the company’s financial status is impressive and encouraging, especially for investors interested in its BEAM stock. According to its latest financial report, the company ended the quarter with $1.2 billion in cash, cash equivalents and marketable securities.

On the date of publication, Joel Lim did not have (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.

Joel Lim is a contributor at InvestorPlace.com and a finance content contractor who creates content for several companies like LTSE and Realtor, along with financial publications, including Business Insider, Yahoo Finance, Mises Institution and Foundation for Economic Education.

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