The oncology industry is a massive and growing one. In fact, with estimates suggesting that oncology drugs will generate $120 billion in revenue annually over the next few years, it’s one of the largest markets in the world.
Of course, where we find big money like this, we tend to find strong investment opportunities. Oncology companies with data readouts and regulatory updates on the horizon tend to represent the largest of these opportunities. With that said, here are what I believe to be the oncology stocks that represent the largest opportunities ahead.
Exelixis (NASDAQ: EXEL): A Blockbuster Drug With Strong Potential Ahead
Exelixis is no newcomer to the oncology scene, in fact, the company won its first approval back in 2012 with Cometriq. The company’s treatments act by inhibiting the production of enzymes that cause cancer tumors to grow. This approach has proven to be effective time and time again with multiple FDA approvals under the company’s belt.
Any FDA approval can prove to be a big win. So, the 2012 approval of Cometriq was great news. However, the drug was approved for the treatment of a rare form of thyroid cancer, and didn’t yield a blockbuster opportunity. Nonetheless, the drug does add to the underlying opportunity here.
In 2014, the company won FDA approval with Roche for Cotellic in combination with Zelboraf in treating advanced melanoma. In 2016, the approval was followed up with Cabometyx earning the FDA greenlight as a treatment for advanced renal cell carcinoma, the most common form of kidney cancer.
However, it wasn’t until 2017 that the treatment was approved as a first-line option for advanced RCC. This was the biggest win as of yet, leading to Cabometyx to generate 2018 sales close to $600 million.
In early 2019, yet another approval came in for Cabometyx, only expanding the opportunity. The drug is now indicated as an option in previously treated liver cancer. Nonetheless, the label is likely to grow even more ahead, pointing to the real opportunity here.
Cabometyx is currently being studied as a first-line treatment for kidney cancer and liver cancer. Moreover, there are four other late-stage clinical studies that center around the treatment across several more cancer types. Additionally, there are more than 50 phase 1 or phase 2 studies underway around the world that feature the drug.
While Cabometyx is already becoming a blockbuster treatment, with all of the clinical activity around the drug, there is plenty of opportunity ahead. Investors can look forward to the publication of several data readouts, as well as new drug applications and potential regulatory approvals down the road. As a result, this is a stock that should be at the top of your watchlist!
Ziopharm Oncology (NASDAQ: ZIOP): Several Ongoing Studies Will Open The Door To Opportunity
Ziopharm Oncology is working to provide solutions for some of the most difficult-to-treat types of cancer out there. However, the company’s method of action is a bit different from what we see from Exelixis and other companies that focus on more traditional cancer therapies.
Instead of starving cancer tumors of the enzymes needed for growth, Ziopharm Oncology is focused on harnessing the power of the body’s own immune system in an approach that has been dubbed immuno-oncology.
This approach is interesting, as many believe that immuno-oncology will prove to be more effective than currently approved treatments, and it is thought that by supporting the body’s own immune system, there is the potential to minimize the risks of toxicity and adverse events.
Essentially, the company’s drug candidates support the immune system through controlled gene expression and innovative cell engineering technologies.
Ziopharm Oncology’s focus is on two clinical candidates, both with several catalystic events ahead. The first, known as AD-RTS-hIL-12, is the subject of one preclinical development program, three Phase 1 development programs, and one Phase 2 development program. These programs range across a variety of oncology-indications, with the clinical studies showing promise.
The company is also working on a variety of Car-T and TCR therapies. These therapies are involved in two preclinical and one Phase 1 development program. They are also at the center of partnerships with the National Cancer Institute and MD Anderson Cancer Institute.
Considering the multiple clinical trials underway and early promise suggested by previously announced data, there are several catalysts ahead that have the potential to yield impressive gains. So, keep a close eye on this stock.
Hemispherx Biopharma (NYSEAMERICAN: HEB): Ampligen Has Explosive Potential
Hemispherx Biopharma is also working on harnessing the body’s own immune system as a way to fight various forms of cancer. The company’s flagship product is known as Ampligen, and it’s one that has already won approval in the world of immunology for the treatment of myalgic encephalomyelitis/chronic fatigue syndrome (ME/CFS) in Argentina. In fact, it is the first treatment in the world to be approved for this indication.
Nonetheless, Ampligen is not a one-trick pony. The treatment is being assessed as an immuno-oncology option across various indications. In fact, Ampligen is being assessed as an option in ovarian, colorectal, and breast cancers, and the design of a study to treat renal cell carcinoma and melanoma is underway.
As an immuno-oncology option, Ampligen is believed to enable the body’s immune system to fight cancer and, potentially, other ailments. For instance, by modulating a tumor’s microenvironment, Ampligen may allow the immune system to target and more effectively attack cancer cells.
Not only is it anticipated that the treatment may perform well as a monotherapy, it also displays synchronicities with other options, suggesting that it holds potential as a combination therapy. In fact, it is believed that Ampligen has the ability to enhance responses from immune blockade inhibitor drugs, commonly referred to as checkpoint inhibitors.
At the end of the day, Hemispherx is a company that comes with incredible potential. Its candidates are being tested across a diverse line of difficult-to-treat cancers. With multiple clinical studies and an active search for a commercialization partner, there are several catalysts that investors have to look forward to ahead.
Incyte Corporation (NASDAQ: INCY): On Its Way To Leadership
Incyte Corporation is a relatively large company. With a market cap of just over $18 billion, it’s no Abbvie (NYSE: ABBV – Market Cap – Nearly $110 billion), but it has the potential to become one.
The company is focused in the world of immuno-oncology. Like Ziopharm Oncology and Hemispherx Biopharma, the company’s candidates enlist and enable the body’s own immune system to battle cancer, a method of action that Incyte has shown time and time again is effective.
Recommended Stock Investing Posts:
- A Review of The Intelligent Investor by Benjamin Graham
- Why Leveraged ETFs are Better Than Futures and Options
- How to Teach Your Children to Invest in the Stock Market
- Top 3 Trading Books Every Trader Should Read
- Top 10 Ways to Quickly Improve Your Trading Skills
- Critical Reasons To Invest In Small Cap Stocks
- Using The Graham Formula to Find Underpriced Stocks
- The Neatest Little Guide to Stock Market Investing Book Review
The company’s claim to fame is a product known as Jakafi. The company’s first commercial product, Jakafi is approved in the United States for patients with intermediate or high-risk myelofibrosis and for patients with polycythemia vera who have had an inadequate response to or are intolerant to hydroxyurea. While Jakafi is already driving significant revenue, the company is working its way toward label expansions that could compound the value of the drug.
In fact, Jakafi is at the center of 12 clinical programs at Incyte. Moreover, the company’s pipeline shows that Jakafi isn’t the only trick up its sleeve. In fact, the pipeline at Incyte includes 19 clinical candidates that are designed around 17 molecular targets.
With Jakafi sales likely to climb and several ongoing clinical programs, Incyte is likely to have plenty of news to share ahead. So, keep your eyes peeled.
Bluebird Bio (NASDAQ: BLUE): Commercialization And Regulatory Catalysts Ahead
Bluebird Bio is an up and coming biotechnology company just starting to move into commercialization phases. Recently, the company announced European approval for its gene therapy, Zynteglo. As a result of the approval, investors are watching closely for sales updates, which will be interesting.
The company put a $1.8 million price tag on the drug, which could be a challenge in terms of payor coverage. However, they may have saved themselves with a key term. Payments can be made over the course of five years. If the treatment doesn’t work, payors no longer have to make payments on the treatment. This may make the high price more acceptable.
It’s also worth mentioning that Bluebird Bio may see approval in the United States for Zyntego relatively soon. It is expected that the company will submit an application to the FDA by the end of the year. With priority review designation, the FDA will make a decision with regard to the drug within six months of the application date.
So, you may be wondering why a company with a flagship treatment that addresses a blood stream disorder made it into an oncology post. Take a look at bb2121. The company is gearing up to submit the treatment as a potential late-line treatment option for multiple myeloma.
This move is likely to happen quickly. After all, Bluebird licensed the commercialization of the treatment to Celgene (NASDAQ: CELG), a biotech that recently announced a deal to be acquired by Bristol-Myers Squibb (NYSE: BMY). Part of this deal includes a contingent value right based on three of Celgene’s candidates making it to market in a prespecified amount of time.
As part of this covenant, bb2121 must be approved by the FDA by March 31, 2021, for the deal to meet CVR requirements. So, there’s going to be a push to move quickly here.
It’s also worth mentioning that the company has multiple preclinical and clinical development programs in its pipeline. With coming data readouts, commercialization announcements, and regulatory updates likely ahead, Bluebird Bio is a must-watch stock!
The field of oncology is one that represents tremendous opportunities for investors. With several catalysts in the near-term calendar expected from the companies above, these are stocks that are well worth your attention.
Read all relevant disclosures here.