Biotech companies’ increasing focus on integrating advanced technology into their research projects to develop viable drugs for treating various critical diseases, and growing demand from an aging population, should drive the biotech industry’s growth. In addition to the industry’s solid growth prospects, we think a low-interest-rate environment should benefit small-cap biotech companies Vanda (NASDAQ:VNDA), Anika (ANIK), Tarsus (TARS), BioDelivery Sciences (NASDAQ:BDSI), and Champions Oncology (NASDAQ:CSBR). So, let’s pore over these names.In addition to playing a significant role in the fight against the deadly COVID-19 virus, biotech companies are now focusing on developing viable drugs and therapies to treat other fatal diseases by integrating advanced technologies. Furthermore, given rising demand for healthcare from an aging population, the industry is well-positioned to grow significantly.
Investor optimism in biotech stocks is evidenced by the iShares Nasdaq Biotechnology ETF’s (IBB) 6.1% gains over the past month versus the benchmark S&P 500’s 3.6% returns.
While many large-cap biotech stocks are trading at expensive valuations now and could witness a price pullback in the near term, the industry’s solid growth prospects and the ongoinglow-interest-rate environment should drive the performances of small-cap stocks Vanda Pharmaceuticals Inc. (VNDA), Anika Therapeutics , Inc. (NASDAQ:ANIK), Tarsus Pharmaceuticals, Inc. (TARS), BioDelivery Sciences International, Inc. (BDSI), and Champions Oncology, Inc. (CSBR). We think these companies’ impressive product portfolios and strong balance sheets make their stocks worth betting on now.