Promising Opportunities in the Biotech Industry
While it is important to acknowledge the inherent risks associated with small growth companies, there are several names within the heavily sold-off biotech industry that are presenting themselves as incredible bargains at current levels. A couple of standout companies in this sector are Agenus (AGEN 0.53%) and Coherus BioSciences (CHRS), both offering attractive risk-to-reward potential.
Agenus, an immunotherapy company, has garnered attention from Wall Street analysts with a predicted stock price surge of 733% in the next year. The primary catalyst behind this projection is Agenus’ plan to submit a Biologics License Application to the FDA for its lead product candidate, botensilimab. This submission is expected to be part of a combination therapy for patients with advanced microsatellite stable metastatic colorectal cancer by mid-2024.
Approval of this combination therapy has the potential to generate annual sales ranging from $240 million to $500 million at peak for Agenus, a substantial amount considering its current market cap of only $298 million. This optimistic price target is supported by a solid premise.
While Agenus carries some significant risks, including limited remaining cash and the need for a strategic partner, its impressive clinical profile in the solid tumor setting may attract a financially well-equipped collaboration.
Coherus BioSciences, a biopharmaceutical company focusing on biosimilars and immuno-oncology, is another compelling option. The company currently has three biosimilars on the market: Udenyca, Cimerli, and Yusimry. It has also received FDA approval for its immuno-oncology drug, Loqtorzi, as a treatment for advanced nasopharyngeal carcinoma.
Despite its expanding product portfolio, Coherus’ stock price has plummeted by 74% this year, primarily due to its unfavorable cash situation. However, the company has committed to expense reduction measures to restore profitability.
Although the financial situation of Coherus is not ideal, investors with a higher appetite for risk might consider investing in this undervalued biopharmaceutical company. With a diversified portfolio, Coherus is expected to become a profitable operation within the next 12 months. Furthermore, the company’s oncology pipeline holds the potential to create even more value for its shareholders in the long term.