Recent history has, once again, demonstrated that relatively small biotech companies can see their shares soar significantly on positive developments. Summit Therapeutics‘ stock is up by more than 2,000% over the past three years, and Abivax, a France-based drugmaker, is up by more than 800% this year following strong clinical data.
Of course, chasing quick gains is not a reliable investing strategy. But some clinical-stage biotechs could deliver superior returns over the long run, provided their master plans come to fruition.
Here are two examples: Viking Therapeutics (NASDAQ: VKTX) and Recursion Pharmaceuticals (NASDAQ: RXRX). These biotechs, both of which have outperformed the market this year, could have massive upside potential — but there’s also risk involved.