In this article, we will be taking a look at the 10 best performing biotech stocks in 2024.
The Booming Biotechnology Sector
The biotechnology sector is expanding quickly due to rising demand for novel therapies, advancement in technology, and government assistance. New techniques are being made possible by advancements in fields like gene editing, sequencing, personalized medicine, and artificial intelligence, while the aging population and growing healthcare demands are driving a robust market for new treatments. Venture capital firms made approximately $52 billion in global investments in therapeutic-focused biotech companies between 2019 and 2021. Two-thirds of this sum was given to platform-tech start-up companies.
The worldwide biotechnology market was estimated to be valued at $1.38 trillion in 2023 and is projected to reach a valuation of approximately $4.25 trillion by 2033, growing at a compound annual growth rate (CAGR) of 11.8% from 2024 to 2024.
The U.S. biotechnology sector, in particular, was estimated to be worth $246.18 billion last year and is projected to reach about $830.31 billion at a compound annual growth rate (CAGR) of 11.6% from 2024 to 2034, according to previous research. The revenue proportion for Asia Pacific was 23.99%, whilst the revenue share for North America was 37.79%. The bioindustry application segment accounted for 24.33% of total revenue in 2023, while the biopharmacy segment held a 41.73% revenue share by application. For 2023, the tissue engineering and regeneration market is expected to account for 19.26% of total revenue.
Despite its potential, there are many risks associated with investing in biotech companies. With 90% of initiatives failing and drug development lasting more than ten years, the industry has a high failure rate. Businesses frequently face bankruptcy if they miss clinical trial endpoints or don’t have enough money before launching a product. As a result of its significant risks and growth potential, biotech is commonly considered a “high-risk, high-reward” investment.
Challenges and Opportunities Shaping the Future of Biotechnology
Biotech businesses have been further challenged by volatile market conditions, which have led several of them to reduce programs and lay off huge numbers of employees to save money. Although recent rate cuts may assist in resurrecting scientific initiatives, analysts like Jared Holz point out that it is still challenging to forecast their consequences. Holz also points out that the performance of biotech companies is increasingly matching that of small-cap stocks, indicating a change in market dynamics. Biotech may increase if small-cap stocks trade well, but stagnation could result from momentum loss. Interest rates and biotech success have a relatively recent relationship that emerged after the pandemic when enterprises with a therapeutic focus received a lot of investment.
Biotech companies are addressing significant unmet medical needs by developing novel therapies that are transforming healthcare. A major advancement is the creation of the National Bioeconomy Board as part of Biden’s Investing in America plan. It aims to optimize the economic potential of biotechnology in the US.
Additionally, the National Security Commission on Emerging Biotechnology is developing policy recommendations to speed up the approval process for biotechnology products. Reducing barriers to entrance will enable more scholars to apply biotechnology to agriculture, which will help American farmers and improve food security. These projects are expected to create new markets.
A laboratory filled with modern equipment, scientists examining the latest biotechnology breakthroughs.
Our Methodology
We selected biotech companies with the best year-to-date (YTD) performance and a market cap of at least $10 billion. This ensured our focus on larger, established firms. The companies were then ranked by their YTD performance as of December 21st to highlight the top performers.
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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Here is our list of the best-performing biotech stocks in 2024.
10. Sarepta Therapeutics, Inc. (NASDAQ:SRPT)
Total YTD Return: 23.66%
Sarepta Therapeutics, Inc. (NASDAQ:SRPT) is a biopharmaceutical company focused on precision genetic medicines for rare genetic diseases, such as Duchenne muscular dystrophy (DMD) and limb-girdle muscular dystrophies (LGMDs). It develops gene therapies, RNA-targeted therapies, and gene editing technologies, with FDA-approved treatments like ELEVIDYS, Exondys 51, Vyondys 53, and Amondys 45. These products are primarily sold to patients with rare genetic conditions, particularly DMD.
In Q3 2024, Sarepta Therapeutics, Inc. (NASDAQ:SRPT) reported strong financial results, with total revenues of $467.2 million, a 41% increase from the previous year. This growth was driven by the successful launch and expanded label of ELEVIDYS, their gene therapy for Duchenne muscular dystrophy (DMD), which generated $181 million in net product revenue. The PMO exon skipping franchise also contributed $248.8 million in revenue, and collaboration revenue from Roche increased to $37.4 million.
As one of the best-performing stocks in the biopharmaceutical sector, Sarepta Therapeutics, Inc. (NASDAQ:SRPT) achieved a GAAP net income of $33.6 million, marking a turnaround from the previous year’s loss. For the first nine months of 2024, their total revenues reached $1.24 billion, a 47% year-over-year increase. The company is also expanding its portfolio, with its lead Limb-Girdle Muscular Dystrophy (LGMD) candidate, SRP-9003, expected to begin regulatory filings in 2025, potentially adding $4.7 billion in sales potential.
As of Q3 2024, 50 hedge funds held shares in the company as tracked by the Insider Monkey database. The largest shareholder was Farallon Capital with holdings worth $322.2 million. Street analysts hold a consensus Strong Buy rating on the stock.
9. Catalysts Pharmaceuticals, Inc. (NASDAQ:CPRX)
Total YTD Return: 24%
Catalyst Pharmaceuticals, Inc. (NASDAQ:CPRX) is a biopharmaceutical company dedicated to addressing rare and debilitating diseases, focusing on neurological and neuromuscular conditions. Its flagship product, Firdapse (amifampridine), is approved for treating Lambert-Eaton Myasthenic Syndrome (LEMS) in adults and children aged six and older. The company also markets Fycompa (perampanel), a medication for focal onset and tonic-clonic seizures in epilepsy, which it acquired in 2023. Additionally, Catalyst Pharmaceuticals, Inc. (NASDAQ:CPRX) launched Agamree (vamorolone) in 2024, an oral suspension for Duchenne Muscular Dystrophy (DMD), achieving strong initial commercial success.
Catalyst Pharmaceuticals Inc. (NASDAQ:CPRX) has emerged as a top-performing biotech stock in 2024. In Q3 2024, the company reported total revenues of $128.7 million, a 25.3% year-over-year increase which was primarily fueled by net product revenues of $126.4 million, up 23.2% from Q3 2023. Net income reached $43.9 million, a significant turnaround from a $30.8 million loss in the same quarter of 2023.
The corporation’s revenue growth was largely driven by Firdapse, which achieved $79.3 million in net product revenues, a 19.7% year-over-year increase. Additionally, the newly launched Agamree, for Duchenne Muscular Dystrophy demonstrated early success, contributing $8.7 million in Q2 2024 and showing continued growth in Q3. Fycompa, the epilepsy drug, also saw a 5.7% year-over-year revenue increase. With updated full-year revenue guidance of $475–$485 million, Catalyst Pharmaceuticals Inc. (NASDAQ:CPRX) continues to capitalize on its expanding product portfolio and market opportunities.
8. Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY)
Total YTD Return: 25.91%
Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY) is a biopharmaceutical company that utilizes RNA interference (RNAi) technology to develop therapies for rare genetic diseases. Its commercial products include ONPATTRO (patisiran) for hATTR amyloidosis, GIVLAARI (givosiran) for acute hepatic porphyria, OXLUMO (lumasiran) for primary hyperoxaluria type 1, Leqvio (inclisiran) for hypercholesterolemia (licensed to Novartis), and AMVUTTRA (vutrisiran) for ATTR amyloidosis. The company sells its products to patients, healthcare providers, and pharmacies, and collaborates with pharmaceutical companies like Novartis for distribution and development.
Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY) revealed impressive financial results for the third quarter of 2024. The company’s total product revenue reached $420 million, a 34% increase from the previous year. The TTR franchise brought in $309 million, a 34% increase in revenue, while the rare disease franchise brought in $111 million which indicated a similar growth rate. Growing patient demand, especially within the TTR franchise, was the main driver of the company’s revenue growth.
Globally, Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY) is treating about 5,000 patients with ONPATTRO or AMVUTTRA for hATTR polyneuropathy. However, according to the business, between 25,000 and 30,000 people worldwide are afflicted with this illness which suggests that there is room for substantial expansion. In addition, the company is getting ready for a possible launch in ATTR cardiomyopathy, subject to regulatory approval. The company’s addressable market may rise considerably as a result of this development, which could spur further growth.
With several significant advancements, the corporation is moving forward with its pipeline. In both the US and the EU, it has finished submitting regulatory applications for vutrisiran in ATTR cardiomyopathy. Additionally, Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY) revealed encouraging findings from a Phase 1 study of mivelsiran for early-onset Alzheimer’s disease and started a Phase 1 investigation for ALN-HTT02, which targets Huntington’s disease. The company wants to greatly increase its clinical pipeline by filing nine own INDs and maybe 15 new INDs by the end of 2025, including partnered initiatives.
The stock has a consensus rating of Moderate Buy from street analysts, with an average 12-month price target of $313.81. The price target range, which is from $205.00 to $400.00, indicates a possible 28.14% increase from the stock’s current price of $244.89.
7. Vaxcyte, Inc. (NASDAQ:PCVX)
Total YTD Return: 37.48%
Vaxcyte, Inc. (NASDAQ:PCVX), standing sixth among the best performing biotech stocks in 2024, focuses on developing protein vaccines for bacterial infectious diseases. Its lead candidates include VAX-24, a 24-valent pneumococcal conjugate vaccine, and VAX-31, a next-generation 31-valent PCV. Other vaccine candidates include VAX-A1 for Group A Streptococcus, VAX-PG for periodontal disease, and VAX-GI for Shigella.
In Q3 2024, Vaxcyte, Inc. (NASDAQ:PCVX) reported strong financial and operational results. As of September 30, 2024, the company had $3.3 billion in cash, including $1.4 billion from a September public offering, supporting its clinical and manufacturing efforts. Research and development expenses rose to $116.9 million, while general and administrative expenses increased to $23.0 million. The company reported a net loss of $103.1 million, up from $92.7 million in Q3 2023, due to higher operating expenses. Vaxcyte, Inc. (NASDAQ:PCVX)’s VAX-31 candidate, which showed positive safety and immunogenicity data, is set to enter Phase 3 trials by mid-2025. The VAX-24 infant Phase 2 study is expected to release topline data by Q1 2025, with booster dose data by the end of 2025.
According to the Insider Monkey database, 48 hedge funds had shares in the company as of Q3 2024, with RA Capital Management holding $992.2 million in shares. Along with a consensus Strong Buy rating, analysts have set an average price target of $148.50, with high and low forecasts of $160.00 and $135.00, respectively. Compared to the previous price of $89.86, the average price objective reflects a 65.26% change.
6. Exelixis, Inc. (NASDAQ:EXEL)
Total YTD Return: 39.11%
Exelixis, Inc. (NASDAQ:EXEL) is focused on small molecule therapies for cancer treatment. Its key products include Cabometyx, a drug for advanced renal cell carcinoma (RCC) and hepatocellular carcinoma (HCC), and Cometriq, another formulation of cabozantinib for different indications. The company is also developing pipeline candidates such as XL092 for advanced solid tumors and XL888, an ATP-competitive inhibitor targeting HSP90.
In Q3 2024, Exelixis, Inc. (NASDAQ:EXEL) reported strong financial results, with total revenues of $539.5 million, up from $471.9 million last year which was due to the cabozantinib franchise, which generated $478.1 million in net product revenues. The company reported a GAAP EPS of $0.40 and non-GAAP EPS of $0.47, both exceeding expectations. Exelixis, Inc. (NASDAQ:EXEL) raised its full-year revenue guidance from $2.15 billion to $2.20 billion. Key factors behind the growth included a 12% year-over-year increase in cabozantinib revenues, a favorable litigation outcome protecting intellectual property, and expanding oncology collaborations, such as with Merck. The corporation also reported a GAAP net income of $118.0 million, up significantly from last year.
Analysts have a consensus rating of Moderate Buy on Exelixis, Inc. (NASDAQ:EXEL), and as of Q3 2024, 33 hedge funds held shares in the company, according to Insider Monkey data. The largest shareholder is Farallon Capital, with holdings valued at $659.4 million.
5. United Therapeutics Corporation (NASDAQ:UTHR)
Total YTD Return: 58.16%
United Therapeutics Corporation (NASDAQ:UTHR) is focused on developing treatments for rare and severe diseases, particularly pulmonary arterial hypertension (PAH), pulmonary hypertension associated with interstitial lung disease (PH-ILD), and pediatric oncology. Its key products include Remodulin, Tyvaso, and Orenitram (all for PAH and PH-ILD), Adcirca (for PAH), and Unituxin (for high-risk neuroblastoma). The company is also exploring monoclonal antibodies, antiviral agents, cell-based therapies, and advancements in organ manufacturing and xenotransplantation.
United Therapeutics Corporation (NASDAQ:UTHR) reported strong Q3 2024 financial results, achieving record revenue of $749 million, a 23% year-over-year increase. Key contributors to this achievement were Tyvaso DPI, with $434 million in revenue (up 33%) which was driven by growth in DPI and use among PH-ILD patients, and Orenitram, which increased 23% to $113 million due to higher demand and pricing adjustments. While Remodulin’s global revenue declined 2% to $128 million, U.S. revenue grew 3%. It’s Unituxin also saw a 19% rise to $61 million.
The company’s earnings per share (EPS) reached $6.39, beating analysts’ expectations of $6.16. United Therapeutics Corporation (NASDAQ:UTHR) demonstrated a net margin of 40.31% and a return on equity of 19.22%, reflecting high profitability and operational efficiency.
As of Q3 2024, 39 hedge funds held positions in United Therapeutics Corporation (NASDAQ:UTHR), according to Insider Monkey’s database. Analysts have assigned the stock a consensus rating of Moderate Buy, with an average price target of $325.55, ranging from a high of $400.00 to a low of $240.00. The average target suggests a potential decline of 14.26% from the most recent price of $379.69.
4. Argenx SE (NASDAQ:ARGX)
Total YTD Return: 63.73%
Argenx SE (NASDAQ:ARGX) is a global immunology company focused on developing antibody-based therapies for severe autoimmune diseases and cancer. Its key product, VYVGART (efgartigimod), is a neonatal Fc receptor blocker approved for treating generalized myasthenia gravis (gMG) in adults. The company uses advanced technologies, including its SIMPLE Antibody Platform, to develop therapies targeting complex diseases, with a pipeline that includes treatments like ARGX-110 and ARGX-117.
In Q3 2024, Argenx SE (NASDAQ:ARGX) reported strong financial results with a 74% year-over-year revenue growth, totaling $589 million. This increase was driven by robust sales of its flagship product, VYVGART, which generated $573 million in global net product sales. For the first nine months of 2024, VYVGART sales reached $1.449 billion. Operating expenses totaled $575 million, including $236 million in R&D and $278 million in SG&A. Despite higher expenses, the company reported a $14 million operating profit and a $91 million net profit. The corporation also strengthened its cash position, ending the quarter with $3.4 billion in cash.
Argenx SE (NASDAQ:ARGX) has emerged as one of the best-performing stocks in the healthcare sector, with analysts maintaining a consensus Strong Buy rating. The average price target is $674.62, with a high of $772.00 and a low of $575.00, indicating a 5.69% potential rise from the current price of $638.33. As of Q3 2024, 43 out of 900 hedge funds tracked by the Insider Monkey database held shares in the company. The largest shareholder is VenBio Select Advisor, with holdings valued at $671.3 million.
3. Viking Therapeutics, Inc. (NASDAQ:VKTX)
Total YTD Return: 131%
Viking Therapeutics, Inc. (NASDAQ:VKTX) is a clinical-stage biopharmaceutical company specializing in innovative therapies for metabolic and endocrine disorders. The company is developing key compounds, including VK2735, a dual agonist targeting GLP-1 and GIP receptors for obesity; VK2809, a selective thyroid hormone receptor beta agonist for conditions like NASH and fibrosis; and VK0214, another thyroid hormone receptor beta agonist for treating X-linked adrenoleukodystrophy (X-ALD). The corporation aims to improve patients’ lives through cutting-edge metabolic research and development.
Viking Therapeutics, Inc. (NASDAQ:VKTX) recorded a net loss of $24.9 million, or $0.22 per share, in the third quarter of 2024, which was higher than in 2023. Higher R&D and general and administrative (G&A) costs were the primary causes of this loss increase. Due to comparable factors, the net loss for the nine months that ended on September 30, 2024, was $74.5 million, or $0.69 million per share.
The company’s R&D expenditures rose from $18.4 million in Q3 2023 to $22.8 million in Q3 2024 as a result of increasing costs for regulatory services, salaries, benefits, and drug manufacturing. Due in major part to stock-based compensation, legal and patent services, and third-party consulting, G&A expenses increased from $8.9 million to $13.8 million.
Viking Therapeutics, Inc. (NASDAQ:VKTX) greatly strengthened its financial position despite these increased costs. As of September 2024, its cash holdings were $930 million, up from $362 million at the end of 2023. Future and ongoing clinical trials will be supported by this increase in monetary reserves.
As of Q3 2024, 41 hedge funds held shares in the company, as tracked by the Insider Monkey database. The largest shareholder in the company was Artia Global Partners with shares worth $33.7 million. Viking Therapeutics, Inc. (NASDAQ:VKTX) has received a consensus Strong Buy rating from analysts.
2. Insmed Incorporated (NASDAQ:INSM)
Total YTD Return: 135.27%
Insmed Incorporated (NASDAQ:INSM) is a biopharmaceutical company focused on innovative therapies for serious and rare diseases, particularly pulmonary and inflammatory conditions. Its key product, ARIKAYCE, treats NTM lung infections caused by Mycobacterium avium complex in adults. The company is also developing pipeline products like brensocatib for non-cystic fibrosis bronchiectasis and treprostinil prodrug for pulmonary arterial hypertension and interstitial lung diseases.
In the third quarter, Insmed Incorporated (NASDAQ:INSM) announced total revenues of $93.4 million, which is an 18% year-over-year growth. Arikayce, its marketed medication, showed a surge in demand in every region, which was the main driver of this expansion. The business reported a net loss of $220.5 million, or $1.27 per share, which was more than the $158.9 million ($1.11 per share) loss from the prior year. Compared to the same time the previous year, selling, general, and administrative (SG&A) expenses climbed by 31% to $118.9 million, while research and development (R&D) spending jumped by 38% to $150.8 million.
Insmed Incorporated (NASDAQ:INSM) intends to file a New Drug Application (NDA) with the FDA in Q4 2024 in anticipation of the possible mid-2025 launch of Brensocatib. According to the Insider Monkey database, 67 hedge fund investors owned shares in the firm as of Q3 2024. Darwin Global Management was the stock’s biggest shareholder.
Street analysts hold a consensus Strong Buy rating on Insmed Incorporated (NASDAQ:INSM), which makes it one of the best performing biotech stocks in 2024.
1. Summit Therapeutics Inc. (NASDAQ:SMMT)
Total YTD Return: 576.89%
Summit Therapeutics Inc. (NASDAQ:SMMT), founded in 2003 and based in Miami, Florida, focuses on developing innovative oncology therapies to address serious unmet needs and tops the list for being one of the best performing biotech stocks. Its lead candidate, ivonescimab (SMT112), a bispecific antibody targeting PD-1 and VEGF pathways, is in late-stage trials for metastatic non-small-cell lung cancer (NSCLC) and shows promising efficacy compared to treatments like Merck’s Keytruda.
In Q3 2024, Summit Therapeutics Inc. (NASDAQ:SMMT) reported a net loss of $56.3 million, up from $21.2 million in Q3 2023, driven by increased clinical study and personnel expenses. R&D costs rose to $37.7 million, reflecting continued investment in advancing clinical trials. The company ended the quarter with $487 million in cash, supported by a $235 million financing round in September 2024, extending its cash runway to focus on Ivonescimab. Investors remain optimistic due to positive HARMONi-2 trial results demonstrating Ivonescimab’s efficacy over existing treatments.
As of Q3 2024, Insider Monkey’s database showed that 21 hedge funds held positions in the company. Analysts have also given the stock a consensus rating of “Strong Buy.”
Overall, SMMT ranks first among the 10 best performing biotech stocks in 2024. While we acknowledge the potential of biotech companies, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than SMMT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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