As we break into the new year, investors are on the hunt for the best biotech stocks to buy. Indeed, 2024 could witness groundbreaking advancements in technology and science. These companies on the cutting edge of research will continue to push the boundaries of advancements in new medicine.
Grand View Research estimated the biotechnology market will grow at a CAGR of 13.96% from 2023 to 2030. Clinical trial pipeline growth and strong regulatory support for biotechnology startups will largely drive the market. With advancements in DNA sequencing, mRNA and cell-based assays, the biotechnology sector is set for explosive growth.
Now, let’s discover the three biotech stocks set for breakthroughs in 2024!
Vertex Pharmaceuticals (VRTX)
Vertex Pharmaceuticals (NASDAQ:VRTX) is an American multinational biotechnology company headquartered in Boston, Massachusetts. The stock had an impressive run, rising more than 40% in 2023.
More recently, Vertex and its partner Crispr Therapeutics (NASDAQ:CRSP) got the FDA nod for its gene editing therapy for sickle cell disease. The therapy, Exa-Cel, became the first ever gene editing therapy to receive approval. That was certainly a great way to cap off 2023, but it isn’t the only tailwind for the company moving forward.
Vertex remains the market leader for therapies addressing cystic fibrosis. Its leading drug, Trikafta, continues to see momentum in sales, with Q3 2023 sales up 13% year-over-year (YOY). The company also raised its FY23 product revenue guidance to $9.85 billion. With a large product pipeline, Vertex is one of the best biotech stocks set for breakthroughs in 2024.
AbbVie (ABBV)
AbbVie (NYSE:ABBV) had a particularly tough year in 2023 due to sluggish sales and EPS growth. However, this year might be a complete turnaround for the company as the company focuses on restructuring and new acquisitions.
In Q3 2023, AbbVie’s revenue fell 6% YOY to $13.93 billion. But what was even more shocking is Humira drugs falling 36% to $3.5 billion. Humira’s patent cliff has been material, suggesting new competition is penetrating the marketplace.
AbbVie has been increasingly reliant on Humira drug sales, which has become a problem for the company in recent years. However, the company is starting to diversify away into other notable drug therapies to drive growth. That includes its recently proposed ImmunoGen (NASDAQ:IMGN) acquisition to expand its cancer drug portfolio. With other notable treatments in its pipeline, investors cannot ignore this blue-chip biotech dividend growth stock.
Health Care Select Sector SPDR Fund (XLV)
Health Care Select Sector SPDR Fund (NYSEARCA:XLV) is a no-brainer biotech stock to buy for 2024. While it is not an individual stock, having exposure to a biotech ETF can provide investors with peace of mind.
The Health Care Select Sector SPDR Fund is one of the largest biotech ETFs on the market. It seeks to track the performance of the healthcare sector of the S&P 500. That means investors will have exposure to a broad range of healthcare stocks, covering pharmaceuticals, healthcare providers & services, healthcare equipment and biotechnology.
Over the last decade, the fund has returned 10.82% annually. Additionally, XLV has $37.74 billion in assets under management with an expense ratio of only 0.10%. This is arguably the most cost-effective and safe way for investors to gain exposure to the best biotech stocks.
On the date of publication, Terel Miles did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.