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 VKTX - URL at bottom to read sections on these]
2. Sage TherapeuticsSage Therapeutics isn't profitable and has no products on the market. But with the biotech's market cap standing at more than $7.3 billion, investors are obviously expecting the situation for Sage to change dramatically in the not-too-distant future. I think those expectations will be met.
The U.S. Food and Drug Administration (FDA) is set to make an approval decision for Sage's lead candidate, an intravenous (IV) version of brexanolone, by Dec. 19, 2018. If all goes well, the drug will become the first therapy approved by the FDA for treating postpartum depression.
I think the chances for FDA approval are quite good based on the phase 3 clinical results for brexanolone. And if the IV formulation of the drug is successful, that bodes well for Sage's followup -- SAGE-217, an oral drug that's similar to brexanolone. The biotech is moving forward with a pivotal phase 3 study of SAGE-217 as a major depressive disorder treatment and expects to announce results in the fourth quarter of this year.
Sage could be looking at peak annual sales of $775 million for brexanolone and $2.5 billion for SAGE-217. I think the potential for these two drugs makes this biotech an attractive acquisition target.
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