In this article, we will look at the 10 Best Mid Cap Biotech Stocks to Buy.
Is the Biotech Sector Oversaturated?
On March 6, Jared Holz, Mizuho health care equity strategist, appeared on CNBC’s ‘Power Lunch’ to discuss investing in biotech and the oversaturation in the sector. He said that looking at the denominator of biotech stocks in the public market, we’re standing at the 700-800 range, depending upon the day. Almost a quarter of these have enterprise values in negative territory. That basically means that investors and companies, in some respects, have exhausted options. For any value to be created, it is necessary to shift focus and devise another plan of attack through an asset they don’t currently own, and resuscitate the company.
In some respects, investors and analysts are always looking for a clear pathway for biotech as a sector to perform better. However, Holz said we are in a tough place if a quarter of the index is filled with companies with more cash than the market cap. That is why he suggested, which some people consider somewhat hyperbolic, getting rid of the tail here, as there are too many assets out there.
Thousands of biotech companies are competing against each other for tiny market or revenue opportunities. Holz opined that venture funds should stop making so many companies that end up superseding each other in a few years. It would be helpful to dissolve all the biotech stocks with negative values and return the cash to shareholders.
READ ALSO: 12 Best Diagnostics Stocks to Invest In Right Now and 7 Most Undervalued Biotech Stocks To Invest In.
How Can One Make Money in Biotech?
Biotechs pose a tempting scenario, as a company’s stock could be worth $5 with a potential blockbuster drug in the pipeline that could cure even cancer. The company’s stock could surge to hundreds of dollars if the clinical trial succeeds. However, at the same time, it could plunge down to $0 if the trial doesn’t. Holz thus says that the sector is incredibly tempting, and thousands of investors put their careers on the line daily to attempt to figure this out.
He characterized biotech as one of the only sectors in all of equities where single stock picking is the only way to make money. Building on his years-long experience covering the industry, he said that the index has barely been up since the past decade. It has been essentially flat. Meanwhile, every other index that one can find has doubled or more. Therefore, there is an obvious issue with the broader complex. But if you find the right asset, you can kill it in the sector.
With these trends in view, let’s look at the 10 best mid cap biotech stocks to buy.
A wide shot of a biotech lab, with scientists wearing lab coats and conducting research.
Our Methodology
We sifted through stock screeners, financial media reports, and ETFs to compile a list of 30 biotech stocks with a market cap between $2 billion and $10 billion. We then selected the top 10 with the highest number of hedge fund holders, as of Q4 2024, and ranked them in ascending order. We sourced the hedge fund sentiment data from Insider Monkey’s database.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10 Best Mid Cap Biotech Stocks to Buy
10. Roivant Sciences Ltd. (NASDAQ:ROIV)
Market Cap: $7.61 billion
Number of Hedge Fund Holders: 44
Roivant Sciences Ltd. (NASDAQ:ROIV) is a biopharmaceutical company that develops transformative medicines, ranking it on our list of the best mid cap biotech stocks to invest in. Its product portfolio comprises Vtama, Batoclimab, Brepocitinib, Namilumab, and RVT-2001, which treat psoriasis, atopic dermatitis, thyroid eye disease, and other illnesses. Thus, its product candidates extend across various therapeutic areas, including oncology, immunology, dermatology, and hematology.
The company’s recent fiscal Q3 2024 earnings surpassed analyst estimates, reflecting considerable progress in its diversified drug pipeline. Revenue reached $9.02 million, exceeding the estimate of $5 million. EPS came in at $0.23, again surpassing estimates of a per-share loss of $0.25.
Leerink Partners analyst David Risinger reiterated their bullish stance on Roivant Sciences Ltd. (NASDAQ:ROIV), giving a Buy rating on March 21. He said the company reported notable data for its first-generation FcRn inhibitor, batoclimab, that treats myasthenia gravis and chronic inflammatory demyelinating polyneuropathy. This supports the company’s belief that improved clinical outcomes can be derived from significant IgG reductions, which lends a positive outlook for its next-generation FcRn inhibitor, IMVT-1402.
The analyst also said that Roivant Sciences Ltd. (NASDAQ:ROIV) is well-positioned to lead in various indications, with IMVT-1402 potentially being the first drug to market in Graves’ disease and other undisclosed indications. The company has a strategic market positioning and a robust pipeline, leading to bullish sentiments from the analyst. Tourlite Capital Management stated the following regarding Roivant Sciences Ltd. (NASDAQ:ROIV) in its Q4 2024 investor letter:
“We continue to believe Roivant Sciences Ltd. (NASDAQ:ROIV) offers an attractive risk-reward and multiple ways to win. Excluding Roivant’s cash balance and Immunovant (IMVT) stake, the remainder of Roivant (ROIV stub) is valued at less than $2 per share. We believe Roivant’s stake in Arbutus and its exposure to the LNP litigation could alone be worth up to $4. In addition to ROIV, we remain shareholders in Arbutus.”
9. BridgeBio Pharma, Inc. (NASDAQ:BBIO)
Market Cap: $6.99 billion
Number of Hedge Fund Holders: 48
BridgeBio Pharma, Inc. (NASDAQ:BBIO) is a commercial-stage biopharmaceutical company that discovers, creates, tests, and delivers transformative medicines to treat patients suffering from genetic diseases and cancers. Analysts are bullish on the stock after the late 2024 FDA approval of its leading drug acoramidis, now branded as Attruby.
Attruby treats transthyretin amyloid cardiopathy (ATTR-CM), a rare but life-threatening heart condition. Analysts expect the drug to attain blockbuster status by 2030. As of February 17, 2025, 1,028 unique patient prescriptions for the drug have been written by 516 unique prescribers since its FDA approval.
BridgeBio Pharma, Inc. (NASDAQ:BBIO) has another potential drug with blockbuster sales potential: infigratinib. Infigratinib is a drug in the pivotal-stage trial indicated for achondroplasia (short stature), and its top-line data is expected by mid-2025. BridgeBio Pharma, Inc. (NASDAQ:BBIO) ended fiscal Q4 2024 with $681 million in cash, cash equivalents, and short-term restricted cash. It expects to receive $105 million in regulatory milestones in the first half of 2025 from its drug acoramidis’ Europe and Japan approvals. The company takes the ninth spot on our list of the top mid cap biotech stocks to buy now.
8. Jazz Pharmaceuticals plc (NASDAQ:JAZZ)
Market Cap: $8.21 billion
Number of Hedge Fund Holders: 49
Jazz Pharmaceuticals plc (NASDAQ:JAZZ) develops medicines for serious diseases. Its primary marketed products include Xywav, Xyrem oral solution, Epidiolex oral solution, Rylaze, Zepzelca, Defitelio, and Vyxeos liposome for injection. These medicines treat excess daytime sleepiness (EDS) in narcolepsy patients seven years of age or older, hepatic veno-occlusive disease (VOD), and other ailments. It ranks eighth among the 10 best mid cap biotech stocks to buy now.
2024 was a record year for the company, with its strong commercial execution leading to over $4 billion in total annual revenue and fiscal Q4 2024 revenue of around $1.1 billion, the highest ever for Jazz Pharmaceuticals plc (NASDAQ:JAZZ). The company attained several significant development and regulatory milestones in 2024 on the R&D front. For instance, in November, it attained the accelerated approval of Ziihera in the US to treat second-line HER2-positive biliary tract cancer.
Strategic corporate development is a key focus for Jazz Pharmaceuticals plc (NASDAQ:JAZZ), which supports its plans to diversify its commercial and pipeline portfolio. It is evaluating oncology and neuroscience assets as part of its ongoing search and is also looking into other rare and orphan diseases. In a report released on March 14, Akash Tewari from Jefferies maintained a Buy rating on Jazz Pharmaceuticals plc (NASDAQ:JAZZ), with a price target of $183.00.
7. Nuvalent, Inc. (NASDAQ:NUVL)
Market Cap: $5.37 billion
Number of Hedge Fund Holders: 50
Nuvalent, Inc. (NASDAQ:NUVL) is a biopharmaceutical company developing precisely targeted therapies for cancer patients. It focuses on small molecules that can minimize adverse events, overcome resistance, and address metastases. The company has a robust pipeline, including ROS1 NSCLC, ALK NSCLC, and HER2 NSCLC.
H.C. Wainwright analyst Swayampakula Ramakanth maintained their bullish stance on Nuvalent, Inc. (NASDAQ:NUVL), giving a Buy rating on February 28. The analyst based their position on various factors, including the company’s strategic implementation of Expanded Access Programs (EAPs) for their investigational drugs, zidesamtinib and neladalkib. The programs have high demand, reflecting the growing interest from patients and physicians for new treatment options in clinical development. They also present Nuvalent, Inc. (NASDAQ:NUVL) with a cost-effective platform for boosting patient exposure to their treatment and building a broader prescriber base. The analyst expects this to support rapid market adoption after regulatory approval.
In addition, the company’s progress in clinical trials also supports the analyst’s bullish sentiments. Nuvalent, Inc. (NASDAQ:NUVL) is on track to release pivotal data for zidesamtinib in H1 2025, and a potential FDA approval can be expected in 2026. The company ranks seventh on our list of the top biotech stocks to buy now.
6. Sarepta Therapeutics, Inc. (NASDAQ:SRPT)
Market Cap: $7.14 billion
Number of Hedge Fund Holders: 50
Sarepta Therapeutics, Inc. (NASDAQ:SRPT) is a commercial-stage biopharmaceutical company that discovers and develops RNA-targeted therapeutics, gene therapy, and other genetic therapeutic modalities to treat rare diseases. The company has several approved products to treat Duchenne muscular dystrophy and is developing potential therapeutical candidates for more disorders, including neuromuscular and central nervous system-related disorders. Its pipeline comprises more than 40 programs at various discovery, pre-clinical, and clinical development stages.
While there is some uncertainty going on regarding the company’s future due to its product Elevidys’ alleged involvement in a fatal acute liver case, Mizuho views the selloff in shares of the company due to these concerns as a “compelling buying opportunity.” It is likely for physician and patient behavior to remain unchanged as Elevidys helps fill a dire need in Duchenne muscular dystrophy. The analyst told investors in a research note on March 19 that Sarepta Therapeutics, Inc.’s (NASDAQ:SRPT) current stock price primarily encompasses the value for its exon-skipping business and limb-girdle, which together add up to $70 per share, instead of Elevidys. The firm sees a “significant” increase in SRPT’s interest at the current stock price.
In a report released on March 21, Gavin Clark-Gartner from Evercore ISI maintained a Buy rating on Sarepta Therapeutics, Inc. (NASDAQ:SRPT), with a price target of $123.00. It is the sixth best mid cap biotech stock to buy now on our list.
5. Vaxcyte, Inc. (NASDAQ:PCVX)
Market Cap: $9.26 billion
Number of Hedge Fund Holders: 50
Vaxcyte, Inc. (NASDAQ:PCVX) is a clinical-stage vaccine innovation company that develops high-fidelity vaccines. It develops broad-spectrum conjugate and novel protein vaccines to prevent or treat bacterial infectious diseases. The company re-engineers the creation of highly complex vaccines through advanced chemistry and modern synthetic techniques.
Vaxcyte, Inc. (NASDAQ:PCVX) remains well-positioned to maintain continued positive momentum across its PCV (pneumococcal conjugate vaccine) franchise. Apart from this franchise, its lead clinical candidate is VAX-24, a 24-valent pneumococcal conjugate vaccine to prevent invasive pneumococcal disease. The vaccine holds significant potential to become a best-in-class PCV in a $7 billion global market expected to reach nearly $13 billion by 2027. The vaccine has received FDA Breakthrough Therapy designation for preventing invasive pneumococcal disease in adults.
TD Cowen analyst Tara Bancroft maintained a Buy rating on Vaxcyte, Inc. (NASDAQ:PCVX) on March 7 and set a price target of $135.00. Baron Health Care Fund also expressed bullish sentiments for Vaxcyte, Inc. (NASDAQ:PCVX) in its Q3 2024 investor letter, saying the following:
“We purchased Vaxcyte, Inc. (NASDAQ:PCVX), a biopharmaceutical company with a next-generation vaccine platform. Vaxcyte recently showed data suggesting that their pneumococcal vaccine is better than the current vaccines on the market today. Pneumococcal vaccines are one of the largest vaccine categories today, with approximately $8 billion in worldwide sales. The vaccines are recommended for children under 5 or adults over 65 to prevent pneumococcal infection. The incumbents’ technology has hit a ceiling where their vaccines require too much protein carrier, which causes immune interference and lowered response to the pneumococcal antigen. As Pfizer and Merck have tried to add more serotypes to their vaccines, they’ve lost efficacy on some of the historically relevant serotypes. Vaxcyte’s platform allows a lower protein carrier/antigen ratio so the company can include more serotypes while minimizing carrier suppression. Vaxcyte recently reported impressive Phase 1/2 data for their VAX31 vaccine in adults. VAX31 looked at least as good as Pfizer’s standard of care PCV20 vaccine on the existing 20 serotypes (and was statistically superior on several serotypes) and added strong immune coverage of 11 additional serotypes. VAX31 now covers 95% of circulating strains in US adults and 98% in the EU. The US will now run Phase 3 studies in adults and start a Phase 1/2 for VAX31 in children. We think that the pneumococcal vaccine market will be $10 billion-plus in 2030, that VAX31 can capture significant share, and that this will be a durable business.”
4. Blueprint Medicines Corporation (NASDAQ:BPMC)
Market Cap: $5.95 billion
Number of Hedge Fund Holders: 56
Blueprint Medicines Corporation (NASDAQ:BPMC) is a commercial-stage global pharmaceutical company that develops life-changing drugs in two core areas: allergy/inflammation and oncology/hematology. The Company delivers its approved medicines in the US and Europe, including AYVAKIT/AYVAKYT (avapritinib) and PDGFRA Exon 18 mutant GIST.
Analyst Michael Yee from Jefferies maintained a Buy rating on Blueprint Medicines Corporation (NASDAQ:BPMC) on March 21, keeping the price target at $135.00. The rating was based on the company’s solid growth profile, ability to consistently surpass revenue estimates, and focus on rare diseases with limited competition, placing it in a favorable market position.
Blueprint Medicines Corporation’s (NASDAQ:BPMC) pipeline, including the WT KIT ‘808 oral pill, presents considerable upside potential. Its early Phase 1 data has delivered promising results, which the analyst expects to translate to a significant market opportunity across multiple inflammatory indications.
Despite some near-term risks, analysts and investors remain bullish on the stock, anticipating continued strong performance. Its median price target of $93.08 implies an upside of 40.74% from current levels. In another report released on March 17, Wolfe Research also initiated coverage with a Buy rating on the stock with a $132.00 price target. The company ranks fourth on our list of the best mid cap biotech stocks to buy now.
3. Ultragenyx Pharmaceutical, Inc. (NASDAQ:RARE)
Market Cap: $3.58 billion
Number of Hedge Fund Holders: 57
Ultragenyx Pharmaceutical, Inc. (NASDAQ:RARE) develops, acquires, and commercializes novel products to treat genetic diseases. Its product portfolio includes Crysvita, Mepsevii, Dojolvi, and Evkeeza. In 2024, the company expanded its business through four products in five indications worldwide.
Ultragenyx Pharmaceutical, Inc. (NASDAQ:RARE) plans to expand its commercial business base in 2025, supported by several products in launch mode worldwide. This progress sets the company on a path to full-year GAAP profitability in 2027. It also exceeded expectations with its 2024 results, reporting a total revenue of $560 million. The company expects 2025 total revenue to be between $640 million and $670 million.
Piper Sandler analyst Allison Bratzel maintained a Buy rating on Ultragenyx Pharmaceutical, Inc. (NASDAQ:RARE) on March 17 and set a price target of $115.00. J.P. Morgan analyst Anupam Rama also maintained a Buy rating on the company on March 6, setting a price target of $104.00. Analysts are bullish on the stock, and its median price target of $38.69 implies an upside of 124.86% from current levels.
Baron Health Care Fund stated the following regarding Ultragenyx Pharmaceutical Inc. (NASDAQ:RARE) in its Q3 2024 investor letter:
“We purchased Ultragenyx Pharmaceutical Inc. (NASDAQ:RARE), a biopharmaceutical company focused on developing treatments for rare genetic diseases. Impressively, the company has gotten 4 drugs approved across 5 indications in 10 years, and it has a large clinical pipeline with several potential blockbuster opportunities in late-stage development. While the company’s approved products continue to grow 20%-plus, we are most excited about the company’s new product pipeline. Setrusumab is in Phase 3 studies for Osteogenesis Imperfecta, a rare genetic disorder that causes bones to break easily. The drug helps patients increase bone mineral density and reduces the number of fractures patients experience. We think this could be transformative for patients and could be a $1 billion-plus peak sales drug. We are also excited about Ultragenyx’s GTX-102, an antisense oligonucleotide that treats Angelman Syndrome, a rare genetic disorder that affects the nervous system and causes severe development delay and intellectual disability. Early data showed dramatic improvement for patients across several behavioral and cognitive endpoints, and Ultragenyx just started a registrational study. The company is also working on a drug for Wilson disease, a rare genetic disorder that causes copper to build up in the body, where we will get proof-of-concept data soon. We think each of these programs has potential for significant value creation, transforming the company to one with significantly higher revenue and profits.”
2. Revolution Medicines, Inc. (NASDAQ:RVMD)
Market Cap: $7.15 billion
Number of Hedge Fund Holders: 60
Revolution Medicines, Inc. (NASDAQ:RVMD) is a clinical-stage precision oncology company that develops novel targeted therapies. It discovers and develops cancer treatments through novel combination and monotherapy treatment regimens that enhance clinical benefits.
The company ended fiscal Q4 2024 with $2.3 billion in cash and investments. This includes $823 million raised from an equity offering, which is anticipated to fund operations into the latter half of 2027. Analysts are bullish on the stock as this financial strength supports Revolution Medicines, Inc. (NASDAQ:RVMD) in its ongoing and future initiatives. Its median price target of $38.45 implies an upside of 85.96% from current levels.
Revolution Medicines, Inc. (NASDAQ:RVMD) has also entered into strategic collaborations to bolster its treatment strategies. These include a bispecific antibodies development collaboration with Aethon Therapeutics and a PRMT5 inhibitor partnership with Tango. These collaborations are expected to expand the company’s therapeutic offerings and expedite development timelines. On March 3, H.C. Wainwright analyst Robert Burns raised the firm’s price target on Revolution Medicines, Inc. (NASDAQ:RVMD) to $73 from $72 and kept a Buy rating on the company. It takes the second spot on our list of the 10 best mid cap biotech stocks to invest in.
1. Cytokinetics, Incorporated (NASDAQ:CYTK)
Market Cap: $5.28 billion
Number of Hedge Fund Holders: 66
Cytokinetics, Incorporated (NASDAQ:CYTK) is a biopharmaceutical company that discovers, develops, and commercializes muscle inhibitors to treat diseases that affect muscle performance. It develops small-molecule drug candidates particularly engineered to affect muscle function and contractility. Its clinical-stage drug candidate portfolio includes omecamtiv mecarbil, a novel cardiac myosin activator, CK-136, a novel cardiac troponin activator, reldesemtiv, a novel fast skeletal muscle troponin activator, aficamten, a novel cardiac myosin inhibitor, and CK-3772271, a novel cardiac myosin inhibitor.
Cytokinetics, Incorporated (NASDAQ:CYTK) is financially well-positioned. As of September 30, 2024, it has around $1.3 billion in cash and cash equivalents and investments, which supports the execution of its commercial strategies and pipeline development. The company has plans to continue the go-to-market goals for aficamten in Germany in 2025. Cytokinetics, Incorporated (NASDAQ:CYTK) also aims to expand commercial readiness activities in Europe this year to prepare for the expected approval by the European Medicines Agency (EMA) in H1 2026.
The company recently announced its ‘Vision 2030’ plan built on a strong 5-year roadmap focusing on significantly enhancing immediate and future value. A significant component of these plans is the anticipated FDA approval and commercial launch of aficamten in 2025. The launch of this leading asset holds the potential to bolster Cytokinetics, Incorporated’s (NASDAQ:CYTK) position in the hypertrophic cardiomyopathy (HCM) market.
On March 17, analyst Joseph Pantginis from H.C. Wainwright reiterated a Buy rating on Cytokinetics, Incorporated (NASDAQ:CYTK) and kept the price target at $120.00. Carillon Eagle Small Cap Growth Fund also expressed bullish sentiments for Cytokinetics, Incorporated (NASDAQ:CYTK) in its fourth quarter 2023 investor letter:
“Cytokinetics, Incorporated (NASDAQ:CYTK) is a clinical-stage biopharmaceutical company focusing on the discovery and development of therapeutic agents that modulate muscle function for the treatment of diseases and medical conditions. The company reported success in clinical trials for Aficamten, a treatment for symptomatic obstructive hypertrophic cardiomyopathy. Investors are optimistic about the prospects for this medication, which could turn out to be a safer, more effective alternative to the current market leader.”
Overall, CYTK ranks first among the 10 best mid cap biotech stocks to buy. While we acknowledge the potential of biotech stocks, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than CYTK but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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