When it comes to biotech shares there is one Australian company that stands head and shoulders above the rest. That is of course $57 billion industry giant CSL Limited (ASX: CSL).
Over the last decade CSL has deservedly earned a reputation for being one of Australia’s highest quality companies.
Investors that recognised this quality early on will no doubt be celebrating today. In the last 10 years CSL’s shares have provided an average annual return of 17.8%.
This means that a $50,000 investment 10 years ago would now be worth almost $260,000 today.
I believe this demonstrates how rewarding it can be for investors to spot a future biotech star early on.
With that in mind, here are three biotech shares which I think are worth keeping a close eye on:
Bionomics Ltd (ASX: BNO)
Whilst Bionomics has a pipeline of potentially lucrative drugs, it is its BNC210 anxiety drug which attracts me the most to the company. Phase 2 trials of the drug not only outperformed the current standard of care, but pleasingly showed no signs of sedation, memory impairment, addiction, or loss of motor co-ordination. The anxiety treatment market is forecast by management to be worth US$18.2 billion in sales by 2020.
Botanix Pharmaceuticals Ltd (ASX: BOT)
Later this year this dermatology company will undertake a Phase 1b trial of its BTX 1503 candidate which uses synthetic cannabidiol to treat moderate to severe acne. Phase 1a trials have proven that the product is safe, and the four-week Phase 1b trial will test its efficacy. Considering the acne prescription market is expected to be worth up to US$4.5 billion by 2018, Botanix could have an extremely bright future ahead of it.
Viralytics Ltd. (ASX: VLA)
This exciting biotechnology company has developed a novel cancer treatment using the common cold virus. While the company is still some way off being profitable, I believe the positive progress its clinical trials program has made hint at the company having a very bright future. In my opinion Viralytics is a company to keep a very close eye on.
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Better yet, this fast-growing company is currently trading at a 30% discount from its highs. Scott believes in this stock so much, he's staked $209k of our own company money on it. Forget 'buy now pay later', this stock could be the next hot stock on the ASX.
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As of 2.11.2020
Motley Fool contributor James Mickleboro has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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