If you’re interested in learning how to invest in biotech stocks and what the best biotech stocks to buy are then you are in the right place! Biotechnology is the place where biology and technology come together to create products that can improve the world and the lives of humans and animals. 

In this ‘Best Biotech Stocks to Buy’ guide we cover a list of biotech stocks to watch for this year and beyond, the best biotech penny stocks to invest in now and how to invest in biotech stocks with zero commission.

Best Biotech Stocks to Buy in 2022

Below is a list of biotech stocks to consider for this year. These include a diverse range of top biotech stocks in the sector that many investors are adding to their watchlists.

  1. Amgen – World’s Biggest Biotech Company by Market Cap
  2. Gilead Sciences – Best Biotech Stock Offering a High Dividend Yield
  3. Biogen – Top Biotech Stock Focusing on Neurological Conditions
  4. Moderna – Leading the Race in mRNA Vaccine Technology 
  5. Regeneron – Top Rated Biotech Stock Focusing on Medicines
  6. Vertex – Hottest Biotech Stocks with High Earnings Per Stock Growth
  7. Illumina – Best Biotech Stock Specialising in Genetics
  8. BioMarin – Most Popular Biotech Stocks for Enzyme Replacement Therapies  
  9. Neurocrine Biosciences – Top Rated Biotech Stock for Neuroscience
  10. SPDR S&P Biotech ETF – An Alternative Play on Biotech Stocks

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A Closer Look at the Best Biotech Stocks to Invest in 

The biotech sector has grown exponentially since the pandemic and is expected to be worth $2.4 trillion by 2028 – one reason investors are keen to know what the hottest biotech stocks are. 

When choosing the best biotech stock to invest in, it’s worthwhile building a portfolio of diversified companies that are focused on different areas in the biotech sector. This can help to balance out any poor performing companies against better companies, providing smoother portfolio equity growth and a great way to buy stocks safely.

Each of these companies in the list of biotech stocks above has a certain specialism within the biotech sector. Some focus on developing drugs for certain conditions such as Alzheimer’s, others focus on producing vaccines for certain infectious diseases like Covid-19 to treat the coronavirus, while others focus on technology for genetics and DNA sequencing.

Read on to find out more about the best biotech stocks to invest in for this year.  

1. Amgen – World’s Biggest Biotech Company by Market Cap

Amgen (AMGN) is the world’s largest biotech company by market cap. Listed on the NASDAQ Exchange, the company is worth more than $134 billion. The biotech company focuses on the discovery, development, manufacturing and marketing of human therapeutics. 

Its products include brands such as Aranesp, Corlanor, Enbrel, Neulasta, Prolia and many others that are approved and on sale today. The company’s most successful product is Neulasta which is an immunostimulator that is used to prevent infections in chemotherapy patients. 

Investors like Amgen stock due to its focus on recombinant DNA technology. The second-largest product sold by Amgen is Enbrel which is a tumour necrosis factor blocker that is used in the treatment of rheumatoid arthritis. 

amgen best biotech stocks to buy

Amgen has revenues of more than $25 billion producing a net income of around $7 billion a year. The company’s stock price had a reversal of fortune in 2008 with the stock price rising more than 600% to a record high of $276.69 in January 2021. 

While the stock did exhibit some weakness in the early 2022 stock market crash, it fell less than the Nasdaq 100 stock market index highlighting the underlying strength of the stock and why Amgen is one of the best biotech stocks to buy today. 

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2. Gilead Sciences – Best Biotech Stock Offering a High Dividend Yield

Gilead Sciences (GILD) is another leader in the biotech sector with a market cap of $78 billion. The American-based company focuses on the research and development of antiviral drugs that are used in the treatment of HIV/AIDS, hepatitis B, hepatitis C and influenza. 

In March 2019, Daniel O’Day took over as CEO and turned the company around after a long period of falling sales. It evolved from a biotech company to a pharmaceutical company by acquiring several healthcare entities. 

The company has had its fair share of criticisms as to its popular Truvada drug which costs more than $2,000 per month in the United States but only around $100 outside of the country. The fact Gilead makes $3 billion a year on the drug led to a Congressional hearing where the CEO had to defend its pricing. 

gilead sciences best biotech stocks to buy

Gilead Sciences has revenues of around $27 billion a year, producing a net income of around $6 billion a year. Gilead’s stock price also produces a current annual dividend yield of 4.66%. 

This is very high for most dividend companies and especially for biotech companies which usually reinvest their profits for growth rather than pay them out in the form of dividends to shareholders. 

The stock price performed well from 2010 to 2015 when it recorded an all-time at $123.37 in June 2015. Since then, the stock price has fallen around 50% providing a good dividend yield and one of the cheapest biotech stocks to buy. 

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3. Biogen – Top Biotech Stock Focusing on Neurological Conditions

Biogen (BIIB) is an American multinational biotech company with a market cap of roughly $31 billion. The company focuses on the discovery, development and delivery of treatments for neurological and neurodegenerative diseases such as Alzheimer’s, Parkinson’s, multiple sclerosis and more.

In March 2019, Biogen had to halt phase 3 trials of its Alzheimer’s drug Aducanumab due to regulatory issues. However, the company reversed their plans the next year which led to the FDA (Food and Drug Administration) approving the drug in June 2021 using the accelerated approval pathway. 

In the past, Biogen has also partnered with companies such as Samsung to build a foothold in the biosimilars sector through its expertise in protein engineering and cell line development.

biogen best biotech stocks to buy

Biogen has revenues of around $10 billion a year which provides a net income of roughly $1.7 billion a year. The company does not pay any dividends as most of the profits are reinvested in the research and development of new drugs. 

From 2008 to 2017 Biogen’s stock price rocketed more than 1,100% higher to create an all-time of $442.29 in March 2015. Since then, the stock price has traded in a range between $442.29 and $215.53. 

Currently, the price is trading at the bottom of the range which has been a price level where the stock price has turned before which is why Biogen is a top biotech stock to watch. 

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4. Moderna – Leading the Race in mRNA Vaccine Technology

Moderna (MRNA), is a relatively new biotech company which went public in December 2018. Listed on the NASDAQ Exchange, the stock has a market cap of $60 billion. The company specialises in the development of medicines based on messenger ribonucleic acid (mRNA) technology. 

Currently, Moderna has a strong pipeline of therapies using mRNA technology. This includes cancer vaccines, intratumoral immunology, regenerative therapeutics and antibody vaccines. 

While Moderna has 44 treatment and vaccine candidates the only commercial product is the Moderna Covid-19 vaccine. The company’s Spikevax vaccine was approved in 70 countries and distributed in 807 million doses creating a revenue of $18.5 billion during the pandemic.  

moderna best biotech stocks to buy

Last year, Moderna produced revenues of $18.5 billion, creating a net income of $12 billion. While most of this was from the Covid-19 vaccine, the biotech company has several vaccine candidates in the pipeline that could add to the bottom line as the need for the Covid-19 vaccine dissipates. 

Since Moderna’s IPO in December 2018, the stock rocketed more than 3,200% higher to an all-time high of $497.49 in August 2021. The stock is now down nearly 70% providing an interesting long-term opportunity for patient investors and making it a top biotech stock to watch. 

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5. Regeneron – Top Rated Biotech Stock Focusing on Medicines

Regeneron Pharmaceuticals (REGN) was founded in 1988 and has a market cap of around $74 billion. Regeneron focuses on the discovery, invention, development, manufacture and commercialisation of medicines. 

The company’s products include brands such as VelocImmune, Dupixent, Praluent, Kevzara, ZALTRAP and many others. Regeneron partnered with pharmaceutical company Sanofi to develop a new drug that would help reduce cholesterol up to 72% more than its competitors. 

In April 2022, Regeneron announced it would acquire Checkmate Pharmaceuticals for roughly $250 million to expand its product range of immuno-oncology drugs. The company also had its Covid-19 vaccine approved by the FDA. 

regeneron best biotech stocks to buy

Regeneron produces revenues of around $8.5 billion every year, creating a net income of roughly $3.5 billion. The stock price had its best period between 2008 and 2015, surging more than 2,500% higher. 

However, the stock price languished between 2015 and 2020 before surging higher to create new all-time highs in early 2022. Regeneron’s stock price has been surging higher even as the broader stock market weakness which highlights the strength in the company’s drug pipeline and makes it one of the best biotech stocks to buy.

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6. Vertex – Best Biotech Stock with High Earnings Per Stock Growth

Vertex Pharmaceuticals (VRTX) is another American biotechnology company with a market cap of around $69 billion. The company specialises in the discovery, development, manufacturing and commercialisation of small molecule drugs for patients with serious diseases such as influenza, viral infections, autoimmune diseases, cancer, etc. 

The company’s top products include Ivacaftor, Lumacaftor and Texacaftor. These drugs are used to treat more than half of cystic fibrosis patients in the United States, Canada, Europe and Australia. 

Vertex is also involved in genetic therapies and has entered into collaborations with CRISPR Therapeutics, Moderna and Arbor Biotechnologies. The company’s pipeline looks strong with drugs targeting sickle cell disease, muscular dystrophy and kidney diseases. 

vertex best biotech stocks to buy

Vertex has revenues of around $3 billion a year. The company has one of the best earnings per stock growth rates in the biotech sector. This strength is shown in its stock price which has risen more than 2,200% since 2008. 

The stock price created a record high at $306.08 in July 2020 before falling more than 40% lower. However, since October 2021, the Vertex stock price has risen 65% and is within reach of its all-time high price level making it one of the best biotech stocks to buy. 

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7. Illumina – Best Biotech Stock Specialising in Genetics

Illumina Inc (ILMN) is another biotech company with a market cap of around $50 billion and growing rapidly. The company develops, manufactures and markets life science tools and integrated systems for the analysis of genetic variation and function. 

The company has a strong pipeline of products and services that are used for sequencing, genotyping and gene expression. In fact, the company managed to reduce the cost of sequencing a human genome to $1,000 from $1 million in 2007. 

Illumina serves commercial clients such as pharmaceutical companies, other biotech companies, genomic research centres and academic institutions. This makes the company rather unique in its core offering which is why the likes of Bill Gates and Jeff Bezos invested $100 million in a Series A funding round in 2017. 

illumina best biotech stocks to buy

Illumina makes around $4.5 billion in revenue each year which provides a net income of around $0.76 billion a year. The strength of the company has led other pharmaceutical companies such as Roche to lead unsuccessful buyout bids for Illumina. 

From 2019 to 2021, Illumina’s stock price rose more than 360% to a record high of $555.77 in February 2021. Since then, the stock price has fallen around 40% lower as the biotech sector focused its efforts on creating a Covid-19 vaccine. 

However, the growth in the genetics sector should not be underestimated and is one reason why Illumina is considered to be one of the best stocks to buy today. 

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8. BioMarin – Top Biotech Stocks for Enzyme Replacement Therapies

BioMarin (BMRN) is a smaller biotech company with a market cap of $15 billion. The company specialises in the business and research of enzyme replacement therapies (ERTs). The company was the first biotech company to provide therapies for mucopolysaccharidosis type I and phenylketonuria.

The company has grown over time through regular acquisitions of other biotech firms. So far, BioMarin has acquired Huxley Pharmaceuticals, LEAD Therapeutics, Zacaharon Pharmaceuticals, Prosensa and many others. 

Currently, BioMarin has six products on the market which are considered orphan drugs. These are pharmaceutical agents that treat rare medical conditions and are not profitable to produce without government assistance. 

biomarin best biotech stocks to buy

BioMarin produces annual revenues of around $1.8 billion which creates a net income of $0.85 billion. As the company is small, there is the potential for long term growth in its stock price – especially because it focuses on orphan drugs which can help to build their pipeline and medical structures. 

From 2009 to 2015, BioMarin’s stock price surged more than 1,300% higher to a record high of $151.75 in July 2015. Since then, the stock price dropped around 50% and has stayed around this price level for the past several years. 

However, with a strong drug pipeline ahead it could be an interesting time for BioMarin stock making it one of the best stocks to buy for the long term. 

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9. Neurocrine Biosciences – Top Rated Biotech Stock for Neuroscience

Neurocrine Biosciences (BINX) is another smaller American biotech company with revenues of around $780 million a year. The company focuses on the development of treatments for neurological and endocrine-related diseases and disorders. 

The company regularly partners with larger pharmaceutical companies such as GlaxoSmithKline, Pfizer and Abbvie. In fact, in 2017 Neurocrine partnered with Abbvie by announcing an exclusive licencing agreement for the development and commercialisation of the Parkinson’s disease drug, opicapone.  

Neurocrine has a good pipeline of products which includes Elagolix which is used to treat endometriosis. Some of its other products in the pipeline are already at stage 3 clinical trials.  

neurocrine best biotech stocks to buy

While Neurocrine may be a smaller biotech company, its annual revenues have grown consistently over the past several years. With a good range of products in its pipeline, it is one of the best stocks to buy for its long term potential. 

From 2010 to 2020, Neurocrine’s stock price rocketed more than 4,600% higher to a record high of $136.26 in July 2020. Since then, the stock has fallen 30% lower. Neurocrine used to be one of the best biotech stocks under $5 and was even considered one of the top biotech penny stocks under $1 for a while. But cheap biotech stocks are not always considered to be a good stock.

Further in this guide, we cover some of the best biotech penny stocks under $1 and how to invest in biotech penny stocks with zero commissions! 

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10. SPDR S&P Biotech ETF – An Alternative Play on Biotech Stocks

An alternative – yet common – play towards biotech stocks is to invest in stocks of a biotech ETF. The SPDR S&P Biotech ETF (XBI) is a fund that already invests in biotech stocks to track the S&P Biotechnology Select Industry Index. 

The fund holds stocks in 163 biotechnology companies from large-cap to small-cap biotech stocks and many which have been discussed above. If you want to invest in a biotech ETF, then you are capitalising on the growth of the overall biotech sector rather than the individual performance of a stock. 

This can be a good way to diversify your capital. Being invested in many stocks, rather than just one, can help to avoid any large losses from just one company as the growth in another company can help to offset it. 

spdr biotech etf best biotech stocks to buy

The SPDR S&P Biotech ETF has experienced strong growth over the past decade. From 2010 to 2021, the ETF rose more than 880%. It is now down 50% from its record high making the biotech ETF one of the best stocks to buy. 

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What are Biotech Stocks?

Biotech stocks are companies that are publicly traded and listed on a stock exchange, whose focus is on creating and developing technology using biology. Biotechnology aims to conquer disease, provide a sustainable environment and advance health. 

While most biotechnology companies will use living organisms and molecular biology to develop products, the science is also used in other industries such as good production, biofuels and genomics. 

Biotech companies differ from pharmaceutical companies because biotech companies use living organisms while pharmaceutical companies use chemicals to create their products. Most people will be familiar with vaccines that are produced by biotech companies, such as the Covid-19 vaccine. 

However, biotechnology is used in a variety of different sectors. You will often see biotechnology used in genetics to reduce infectious diseases, as well as in biocatalysts to improve manufacturing processes. 

As biotech companies can provide solutions in a wide range of sectors, they have seen significant growth over the past decade. 

Are Biotech Stocks a Good Investment?

One reason biotech stocks are so popular among investors is that they can be very volatile and exhibit big price swings. This is because biotech companies make a profit only after spending a lot on research and clinical trials which may not result in success. 

However, investing in the most popular biotech stocks can be a good investment if you do proper research and exercise strong risk management principles. As biotechnology offers solutions to world problems, the underlying and long term growth is there. 

Revenues from Biotechnology are Set to Increase

Global revenues received from the biotechnology sector are set to increase exponentially over the next few years, as highlighted in the chart below. With pharmaceutical companies investing and partnering with biotech companies to find the next vaccine or healthcare trend, it’s a sector worth investing in. 

biotech revenues best biotech stocks to buy

Source: Statista

The end of the pandemic is also likely to lead to more revenues for biotech companies. This is because the sales teams are able to travel the world and pitch their products to investors, governments and big pharma which will lead to higher sales. 

Biotech Merger & Acquisition (M&A) Activity Will Pick Up

During the pandemic, investors piled into biotech stocks. However, many investors have banked profits on the pandemic-related vaccine theme. This has led to some serious bargains among biotech companies which are ripe for big pharma to buy out. 

In fact, big pharma is now sitting on more cash than ever before which is likely to lead to a buying frenzy of biotech companies, driving their stock price higher. Also, many pharma companies are losing patent protection which means they need to invest in biotech companies to find the next blockbuster drug. 

In fact, the biotech M&A activity is around record lows which means it has nowhere to go apart from higher. Deal making has already started to grow, albeit slowly. But, even so, we are seeing 50%+ moves in some biotech stocks on rumours of a buyout or big pharma partnership. 

Biotech Penny Stocks

Biotech penny stocks are defined by the price a biotech company is trading at. For example, biotech stocks under $5 fit into the penny stock category. There are also biotech penny stocks under $1. These are not to be confused with cheap biotech stocks though. 

Biotech penny stocks can be very volatile. This is because penny stocks are typically new companies that are very early on in their overall business cycle. While they can exhibit some outsized growth turning into a larger company, there will be some that never make it. 

From our research, we found three biotech penny stocks to focus on for this year:

  1. BioNano Genomics (BNGO) –  A Leader in Optical Genome Mapping Technology
  2. Vir Biotechnology (VIR) – An Immunology-Based Biotech Penny Stock for Growth
  3. Zynerba Pharmaceuticals (ZYNE) – Next Gen BioTech Cannabinoid Therapeutics Company

These three stocks are available to invest in through FCA regulated broker eToro

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Where to Buy Biotech Stocks

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If you are asking the question of where to buy biotech stocks then you should seriously consider eToro. The eToro stock app and platform launched in 2007 and already boasts more than 20 million daily users who trade everything from real-time blue-chip stocks to penny stocks, indices, commodities, cryptos and more.

One reason eToro is so popular is that it is authorised and regulated by the UK Financial Conduct Authority (FCA), the Australian Securities and Investments Commission (ASIC), and the Cyprus Securities and Exchange Commission (CySEC). 

This provides a high level of safety and security for your funds which is important when choosing a stockbroker.  

etoro best biotech stocks to buy list

You can buy stocks on eToro 100% commission free while also collecting income from dividend stocks on high yield stocks. All of the stocks and instruments discussed in this ‘Best Biotech Stocks to Buy’ guide are available to invest in via eToro, commission-free. 

From the eToro platform, you can also access the best oil stocks and the top metaverse stocks, to the best cannabis stocks and NFT stocks. You can also speculate on stock prices using CFDs, or contracts for difference. This allows you to speculate on rising and falling markets which means you can potentially profit no matter the direction of the stock (provided you get the direction right of course!). 

Another great feature of the eToro platform is its social trading cryptocurrency and copy trading services. You can talk through trades and ideas with other investors and copy their trades onto your own account if you like their performance. 

etoro copy trading best biotech stocks to buy

From the eToro Copy Trader feature, you can view the performance of other traders and investors. If you like their returns, then you can have their exact trades copied onto your own account. This is great for learning more about investing but can also help you to build another passive income stream on the side.

The eToro investment management committee have also created eToro Smart Portfolios. These are ready-made investment portfolios that cover different themes such as biotech, artificial intelligence, blockchain tech, drone tech, the metaverse and many other themes.

etoro smart portfolio best biotech stocks to buy

It only takes a few minutes to open an account with eToro and you only need $10 to get started!

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How to Buy Biotech Stocks on eToro

If you want to learn how to invest in biotech stocks and how to invest in biotech penny stocks, then follow the four-step process outlined below. 

1. Create Your Account

Opening an account with eToro is really simple. Just fill out a few personal details on the application form. 

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2. Account Verification

eToro will have to validate your identity in order to be compliant with AML and KYC standards.

The following are the two identification docs you will require:

  1. A current passport or driving licence is required.
  2. A recent utility bill or bank statement

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3. Deposit Funds

In order to invest in the best biotech stocks, you need some funds to start with. Deposits are fee-free and the payment methods include:

  • Debit/credit card
  • Bank wire transfer
  • PayPal
  • Neteller
  • Skrill

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4. Buy Biotech Stocks!

Search for your biotech stock in the search box at the top of the platform and then click Trade to open a ticket and complete your order. The minimum stake is only $10 and you can do it at a click of a button. 

etoro buy ticket best biotech stocks

Now you know how to invest in biotech stocks and how to invest in biotech penny stocks! The trading ticket also allows you to set pre-determined stop loss and take profit price levels. 

Conclusion

As biotechnology helps to solve world problems, the growth in the sector is forecasted to be exponential. Finding the best biotech stocks now, could help to boost your portfolio in the long term. 

When purchasing biotech stocks, it’s important to stick to an authorised and regulated stockbroker such as eToro which is regulated by the FCA, CySEC and ASIC. Furthermore, you can invest in stocks 100% commission-free, while accessing a ton of useful extra tools. 

Open an account for FREE today and see for yourself!

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