Biotechs often need several years to realize their visions, even after they have a drug approved for the first time. There's typically plenty of upside in store for enterprising and patient investors.
Here are two such opportunities that are ripe for buying today, provided that you're willing to hold on to your shares for at least five years.
1. CRISPR Therapeutics
With a bunch of gene therapy and gene editing programs in clinical trials, CRISPR Therapeutics (NASDAQ: CRSP) has an impressive resume already, but it's just getting started. It's currently in the process of building out the infrastructure it needs to administer and manufacture its first gene therapy to get approval, which is called Casgevy.
It hasn't yet had time to register any revenue from sales of Casgevy. The odds are good that the medicine will make for a slow burn rather than a windfall profit, as the proceeds will be split with Vertex Pharmaceuticals, which will take the larger share of the pie. Also, the company's buildout of authorized treatment centers (ATCs) is just beginning to pick up speed. Still, the proceeds from Casgevy's launch will likely eventually be sufficient to cover most of CRISPR's research and development (R&D) costs, which totaled more than $387 million in 2023 alone.
That will ensure that its pipeline will have the fuel it needs to advance clinical-stage programs toward approval, like its three cell therapy programs for treating cancers, or its gene editing program to treat atherosclerotic cardiovascular disease (ASCVD) in patients with elevated lipoprotein a (Lp(a)).
Some of its candidates, including its ASCVD program, have the potential to permanently improve the health of patients with just one dose thanks to their ability to correct problematic genes. While it will be at least a few years before those more powerful gene editing therapies get approved for sale, assuming they ever are. Their addressable market could be vast, especially considering approval would open the door to future projects seeking to improve or safeguard the health of already-healthy people.
And, when paired with the high probability of steady revenue starting to flow in soon, that possibility is another solid reason to buy the stock today.
2. Iovance Biotherapeutics
Much like CRISPR Therapeutics, Iovance Biotherapeutics (NASDAQ: IOVA) is rolling out its first treatment, a cell therapy called Amtagvi. With revenue of $58.6 million in the third quarter, it expects sales of the medicine of as much as $165 million in 2024, and as much as $475 million for its 2025 fiscal year. The challenge of the moment is, once again much like of CRISPR, to build a network of ATCs where patients can undergo treatment.
Amtagvi is currently approved to treat advanced melanoma after patients have been treated with an anti-PD-1 medicine as well as another type of drug. But, with Iovance's R&D work, it could soon be approved to treat non-small cell lung cancer as a second-line treatment. More importantly, it's also being tested to see if it could be used as a first-line treatment for melanoma when administered alongside pembrolizumab, a common immunotherapy that's used along with many anti-cancer drugs.
Per a report by Global Market Insights, the market for melanoma drugs like Amtagvi will be as large as $7.5 billion in 2032. Assuming Amtagvi performs as favorably as it did in its clinical trials, in which around 31.5% of patients responded to treatment, it has a chance of capturing a significant share of the market. That's especially true considering there aren't any other therapies that are directly comparable to it in terms of the mechanism of action.
So, with a long runway of expanding Amtagvi's availability to patients as well as the conditions that it's approved to treat, Iovance is set for a highly profitable decade, which is a smart reason to buy it.
Should you invest $1,000 in CRISPR Therapeutics right now?
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Alex Carchidi has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends CRISPR Therapeutics, Iovance Biotherapeutics, and Vertex Pharmaceuticals. The Motley Fool has a disclosure policy.
