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Gilead vs. Biogen: Which Biotech Stock is a Better Buy?

Published 05/05/2021, 11:30 AM
Updated 05/05/2021, 12:30 PM
© Reuters.  Gilead vs. Biogen: Which Biotech Stock is a Better Buy?

© Reuters. Gilead vs. Biogen: Which Biotech Stock is a Better Buy?

The biopharmaceutical sector has exhibited strong momentum in recent years, driven by government initiatives to modernize the drug regulatory pathway and higher investments in research and development. Also, the COVID-19 has proven to be a catalyst for the sector’s growth. Now that biotech innovation is perceived more clearly as critical to worldwide human health, we think top players Gilead Sciences (NASDAQ:GILD) and Biogen (BIIB) should see sustained demand for their products to their valuation benefit. But let’s find out which of these stocks is a better buy now.Gilead Sciences, Inc. (GILD) and Biogen Inc. (NASDAQ:BIIB) are two leading biopharmaceutical companies in the United States and internationally. GILD has developed Remdesivir, the only antiviral drug for treating COVID-19, and other drugs, such as Trodelvy and Zydelig, for the treatment of hematology and oncology. BIIB offers TYSABRI and FAMPYRA for multiple sclerosis and BIIB101 and BIIB122 for treating Parkinson's disease, among other drugs.

The biopharmaceutical industry has been playing a pivotal role in fighting the coronavirus public health crisis. In fact, the global biotechnology market is expected to expand at a 5.8% CAGR from 2021 - 2028. As the need for continued research for new drugs and treatments for existing and future diseases continues to rise, biotech players such as GILD and BIIB should continue thriving. Also, the U.S. government is taking steps to ease the regulatory process and speed up the drug approval timeframe, which should bode well for these companies.

GILD has gained 12.9% year-to-date, while BIIB has returned 12.4% over the same period. In terms of past three month’s performance, BIIB is the clear winner with 4.6% gains versus GILD’s 2% returns. But which of these stocks is a better pick now? Let’s find out.

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