Whether penny stocks or blue-chips, analysts have high hopes for biotech stocks right now. Thanks to the growing optimism for new treatments & novel discoveries, this is one of the hottest industries in the stock market today. Does it come with plenty of risks? Of course, and this is one of the highlights that stand out for readers looking for an edge.
For nearly a decade, biotech stocks have been outpacing broader markets in a big way. Just take a look at the chart below comparing major biotech stock ETFs like the Nasdaq Biotech (NASDAQ:IBB) & S&P Biotech ETF (NYSE:XBI) versus the S&P 500 (NYSE:SPY) and Dow Jones (NYSE:DIA):
While the returns during this period for the SPY & DIA are remarkable, the clear winners are the biotech ETFs. During that same period that the SPY and DIA scored 150%-200% returns, the IBB and XBI far-surpassed those figures. The IBB is up nearly 250%, and the XBI, nearly 300%. As you’ll also see, at one point, the XBI almost hit 450% returns since late 2012. Driven by hefty speculation and, of course, groundbreaking developments, biotech stocks have remained an attraction for retail traders for years.
Hot Biotech Stocks To Watch Right Now
In this article, we’ll take a look at a new list of former penny stocks that analysts have become bullish on. What’s more, they’re each working on novel treatments and have reached major milestones over the last few months:
GT Biopharma Inc. (NASDAQ: GTBP)
Oncology treatment has long been a hot topic in the biotech industry and the stock market. Whether it’s the latest frontline treatment for a broad range of cancers or new means of targeted cell therapies, this is a topic that remains a core focus. It’s the latter that has eyes peeled on GT Biopharma this year.
Following its uplist to the NASDAQ exchange, the market began paying close attention to GT’s treatment pipeline. Not only did it include its lead GTB-3550 for acute myeloma and myelodysplastic syndrome, but also a myriad of other candidates. These include treatments for indications that express HER2 (GTB-6550), PD-L1 (GTB-4550), and B7H3 (GTB-5550), for example. They are all based on the company’s tri-specific killer engager cell treatment technology or “TriKE.”
This has given the company an edge during trials for its own monotherapies and in additional clinical trials when combined with other types of drugs. For instance, GT Biopharma’s B7H3 TriKE combined with Fate Therapeutic’s (NASDAQ: FATE) FT538 iNK cells targeting tumor cells in prostate cancer showed significant progress. The FT538 alone demonstrated a slight impact on cells in the model; however, the combination with GT’s TriKE demonstrated a complete eradication of cancer cells (read more on this specific trial):
What Do Analysts Think About GTBP Stock?
Aside from this progress, analysts have begun following GT Biopharma’s progress as well. Most recently, B. Riley boosted its price target from $21 to $26 (roughly 116% above current levels) while keeping its Buy rating on the stock.
Analysts at the firm went as far as saying, “Based on the press release and our subsequent conversation with management, we are encouraged by the mounting evidence of clinical activity and the emerging safety profile of lead asset GTB-3550…With the dose-escalation portion of the trial expected to complete towards the end of August 2021, we are raising our probability of success for GTB-3550 in CD33+ acute myeloid leukemia (AML) and higher-risk myelodysplastic syndrome (HR MDS) from 25% to 30%, with a commensurate increase in our 12-month price target.” Read Full Analyst Report Here.
B. Riley also discussed the Fate NK cell therapy combined with GT’s TriKE showed “synergy” in preclinical of other cancers, including prostate cancer.
Affimed (NASDAQ: AFMD)
Another one of the biotech stocks to watch right now is Affimed. As another cancer treatment stock, AFMD has experienced a banner year over the last 12 months. It was, like GTBP, a former penny stock not that long ago. However, thanks to the progress in its pipeline, Affimed remains a core focus for traders. Namely, the company’s AFM13 and AFM24 have demonstrated meaningful results in early studies.
Preclinical data in its AFM13 combined with NK cells showed improved tumor recognition and cell killing in vitro and in vivo. Furthermore, the candidate showed a 100% objective response rate in the first 4 response evaluable patients. Data on this combination trial are expected in the second half of this year, so this could be a key pipeline treatment to keep track of, especially as the second half of 2021 is underway.
Data is also expected from its AFM24 candidate in treating epidermal growth factor receptor (EGFR) tumors. Both as a monotherapy and combined with other treatments, the company expects to begin studies starting during the back half of the year. In the July earnings update, Dr. Adi Hoess, CEO of Affimed, explained, “Over the next several months, we have a number of value-creating events on AFM13, AFM24, where we expect to initiate several clinical studies, and AFM28, and are allocating capital across our portfolio to develop multiple opportunities for shareholder value creation.”
What Do Analysts Think About AFMD Stock?
Analysts at BMO Capital seem very bullish on AFMD stock right now. Earlier this year, the firm boosted its price target to $15 (roughly 120% higher than current levels) and maintained an Outperform rating. Do Kim of BMO updated his model with Hodgkin lymphoma indication “probability of success” increasing to 60% from just 35%.
This came after the company’s positive update from the MD Anderson Cancer Center study where early responses confirmed AFM13+cbNK cell benefit in highly refractory Hodgkin lymphoma patients. Do went on to express that the data validates the company’s recent working relationships with other NK cell companies, including NKGen and Artiva.
Ocugen Inc. (NASDAQ: OCGN)
No list of biotech stocks would be complete without at least one focused on Covid treatments. In line with the theme of this article, OCGN stock was also a “penny stock graduate” this year. The company initially focused on developing treatments for eye disease. But through its relationship with Bharat Biotech, the story in 2021 has been all about COVAXIN. Bharat developed this in collaboration with the Indian Council of Medical Research National Institute of Virology. With a long track record of safety, it has been seen by some as another potential vaccine to join the growing list of competitors.
Why Ocugen has become such a focus recently has to do with the potential entry into the North American markets. COVAXIN is administered under emergency use authorizations in 13 countries, with another 60 having pending EUAs right now. This month Ocugen reported that it had new data from Bharat that would help things move forward with its plan to file for approval in the U.S. and Canada.
New efficacy analysis showed that COVAXIN was 93.4% protective against severe symptomatic COVID-19. Furthermore, the efficacy data demonstrated 65.2% protection against the SARS-CoV-2, B.1.617.2 Delta variant. “. We expect these efficacy and safety outcomes, along with demonstrated efficacy against emerging variants of concern, will support our initiatives to bring COVAXIN to the US and Canadian markets,” said Dr. Shankar Musunuri, Chairman of the Board, Chief Executive Officer and Co-Founder of Ocugen in a July PR.
What Do Analysts Think About OCGN Stock?
There’ve been several firms that came out this year in support of Ocugen. HC Wainwright, for instance, has a Buy rating on the stock and a $10 price target (roughly 41% higher than current levels). H.C. analyst Swayampakula Ramakanth highlighted Covaxin and how it might be able to induce neutralizing antibodies against emerging SARS-CoV-2 variants. Ramakanth also discussed how the vaccine could still help to address “this much-needed public health concern” in a research note. Given the rise in new virus cases, stocks like OCGN could be ones to watch as well.
Final Thoughts About Biotech Stocks
If you’re looking for biotech stocks to buy, whether they’re penny stocks or higher-priced, the basic strategy is the same: Find companies in early stages that demonstrate a clear path the commercialization backed by continued clinical progress. With the addition of new research provided by analysts, the minute details can also help you decide on the outlook for some of these companies. Considering the massive growth that the biotech industry has seen and the overall market-beating returns, it’s hard not to have at least a few names on your list right now.
Pursuant to an agreement between Midam Ventures LLC and GT Biopharma (GTBP) Midam has been paid $150,000 for a period from March 1, 2021, to April 1, 2021. This compensation is payment 1 of 12 as part of a 12-month agreement between Midam Ventures LLC & GT Biopharma (GTBP), for a period from March 1, 2021, to February 28, 2022. Midam Ventures LLC expects to be paid $150,000 per month for a total of 12 months by GT Biopharma (GTBP). Midam has been paid an additional $150,000 for a period from April 2, 2021, to May 1, 2021. This compensation is payment 2 of 12 as part of the Agreement. Midam has been paid an additional $150,000 for a period from May 2, 2021, to June 1, 2021. This compensation is payment 3 of 12 as part of the Agreement. Midam has been paid an additional $150,000 for a period from June 2, 2021, to July 1, 2021. This compensation is payment 4 of 12 as part of the Agreement. Midam has been paid an additional $200,000 for a period from July 2, 2021, to August 2, 2021. This compensation is payment 5 of 12 as part of the Agreement. We may buy or sell additional shares of GT Biopharma (GTBP) in the open market at any time, including before, during, or after the Website and Information, to provide public dissemination of favorable Information about GT Biopharma (GTBP). Click Here For Full Disclaimer.