Biopharma stocks have trailed the broader market by a bit in the first half of this year, but—as is always the case in the drug development industry—that’s only part of the story.
While the sector’s indexes and exchange-traded funds are lagging behind the S&P 500, standout stocks have climbed and fallen dramatically. To identify the biggest biopharma movers in the first half of 2021, we looked at the stocks with a market value over $5 billion that have climbed and fallen the most so far this year.
These stocks are on the cutting edge of various technologies that have enticed investors with their promises of solving a list of currently unsolvable diseases: messenger RNA, gene therapy, gene editing. Their fates illustrate the big risks, and potential rewards, of biotech investing.
On the upside, the sector’s biggest winners are Covid-19 vaccine maker BioNTech (BNTX), whose American depositary receipt has soared 179.8% in 2021, and Intellia Therapeutics (NTLA), up 178.7%. The biggest losers year to date are Sarepta Therapeutics (SRPT), down 53.8%, and AbCellera Biologics (ABCL), down 47.1%.
Of these top gainers, the most familiar story is perhaps that of BioNTech, the Pfizer (PFE) partner that analysts expect to earn $10.8 billion in Covid-19 vaccine revenues this year alone, according to FactSet.
BioNTech’s pipeline is deep and intriguing, though virtually all of it is in very early stages, as Barron’s reported in April. The stock has been buoyed in recent months by a surge of investor interest in messenger-RNA specialty firms. For instance, shares of Moderna (MRNA) have climbed 124.4% so far this year, and shares of Translate Bio (TBIO), another mRNA specialist, are up 39.2%.
Intellia, for its part, is a gene-editing stock that scored a major breakthrough over this past weekend, as the company reported positive results in a trial of a gene-editing treatment for a fatal liver disorder. Shares of Intellia climbed 50.2% on Monday, and another 13.6% on Tuesday.
The stocks that have fallen the farthest this year have sadder tales to tell. Sarepta stock plummeted in early January after the company announced that a trial of a gene therapy for Duchenne muscular dystrophy had failed. Sarepta shares closed Dec. 31, 2020 at $170.49, but fell to $82.29 on Jan. 8, after the company announced the trial results. The stock hasn’t recovered, and closed Tuesday at $78.82.
Some analysts have hope. Of the 21 who track the stock covered by FactSet, 13 rate it a Buy or Overweight, while seven rate it Hold, and one rates it Sell.
Shares of AbCellera, which went public late last year, have fallen steadily over the course of 2021. The company developed bamlanivimab, one of the monoclonal antibodies in the Covid-19 antibody cocktail marketed by Eli Lilly (LLY).
Expectations for bamlanivimab sales have dropped, after the U.S. Food and Drug Administration revoked its emergency use authorization for bamlanivimab alone in the face of an expanding threat from variants of the virus that causes Covid-19, though maintained its authorization for bamlanivimab as part of the Lilly antibody cocktail.
Analysts continue to like the stock. Of the five who track AbCellera polled by FactSet, all rate it a Buy.
Write to Josh Nathan-Kazis at [email protected]