[VKTX] 3 Top Biotech Stocks to Buy for the 2nd Half of 2018
Keith Speights, The Motley Fool
July 8, 2018
It seemed almost like a blur, but the first half of 2018 is already history. Generally speaking, biotech stocks didn't perform as well during the first six months of the year as they did during the same period in 2017. But 2018 has plenty of time remaining.
Which biotech stocks are good picks to buy for the second half of the year? Among large-cap biotechs, Celgene (NASDAQ: CELG) is one of my top favorites. Moving down to mid-cap biotech stocks, I think Sage Therapeutics (NASDAQ: SAGE) appears to be a smart choice. My small-cap pick is Viking Therapeutics (NASDAQ: VKTX). Here's what I like about these three biotech stocks.
[snip CELG and SAGE - URL at bottom to read sections on these or check the SAGE thread for that section]
3. Viking TherapeuticsSpeaking of potential buyout candidates, I'd also put small-cap biotech Viking Therapeutics high on the list. Viking's share price has soared more than 130% so far this year, but I think it could go even higher.
Viking's pipeline isn't nearly as far along as Sage's. The biotech's lead candidate, VK5211, completed a phase 2 clinical study in November 2017 for stimulating muscle and bone formation in patients recovering from hip fracture. And the pipeline drug that has generated the most excitement among investors, VK2809, still is in phase 2 testing.
VK2809 is being evaluated for the treatment of non-alcoholic fatty liver disease (NAFLD) and high cholesterol. Viking expects to announce the results from the phase 2 study sometime in the second half of this year. Expectations of positive results are high, though, because of Madrigal Pharmaceuticals' (NASDAQ: MDGL) encouraging update from its own phase 2 study of MGL-3196 in treating non-alcoholic steatohepatitis (NASH), one of several diseases included in NAFLD.
What's important to know is that VK2809 and MGL-3196 use the same mechanism of action. Several large drugmakers are scrambling to develop NASH drugs. Madrigal could be thinking about selling, and if it's acquired, I think Viking will be in great demand, too.
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