Many biotechnology stocks trade for less than $5 per share but get little technical analysis from investors who focus on larger-cap stocks. But where should you start your search? Keep reading for our favorite biotech stocks trading under $5 and find out.
Best Biotech Penny Stocks Under $5
Atossa Therapeutics Inc. (NASDAQ: ATOS)
Atossa Therapeutics Inc. is a biopharmaceutical company in clinical development. Its current focus is on breast cancer and COVID-19, two of medicine’s most well-funded disorders, which is why it’s one of our picks for the top biotech stocks.
Recently, Atossa Therapeutics’s lead drug candidate, Endoxifen, has shown potential for reducing tumor cell activity. These positive results may bode well for the future of the company and its ability to provide cutting-edge breast cancer treatments.
In addition, the company has a large market cap ($127.89 million) and a robust drug pipeline to help treat patients. It began enrolling patients in the AT-H201 clinical trial in Australia last year.
This ongoing study aims to develop a nebulized formulation for patients hospitalized with COVID-19 and “long haul” patients with post-infection pulmonary disease.
AT-H201 just finished treating healthy participants in Parts B and C (of four parts) of a Phase 1/2a Clinical Trial. This means that the company has now progressed to testing the drug in patients with COVID-19.
Also, the company outlined plans to continue developing AT-H201 in patients whose lung function has been damaged by cancer therapy, shifting the program to better correspond with its oncology emphasis.
These developments put Atossa in a good position to capitalize on strong tailwinds as COVID-19 is still a major global concern and cancer rates continue to rise.
These details can be crucial to providing additional medication that directly targets a pandemic-driven market, providing a potential positive outturn for Atossa for years to come.
As a result of this year’s stock offerings, Atossa has amassed around $110 million, which may be enough to keep the company solvent through 2023. In 2021, Atossa completed its strongest recovery since 2018, pushing for a 3-year high, only to tumble back to its early 2019 numbers.
All this means is Atossa is vulnerable to all the trappings of the typical biotech stock, which is rapid spikes during stock catalyst situations, followed by a long hiatus until news arrives.
The company planned several milestone targets for 2022, including the completion of its COVID-19 clinical study enrollment.
It also plans to continue the development of Endoxifen by running an Investigational New Drug Application (IND) for its Phase 2 study. All this hubbub from Atossa means it’s a great stock that has good potential for the future, as long as it gets a positive turnover.
Lineage Cell Therapeutics, Inc. (NASDAQ: LCTX)
Lineage Cell Therapeutics, Inc. is a company that specializes in the development of new cell treatments and prescription therapeutics. In December, the company connected with Swiss healthcare giant Roche Holding signing a collaboration deal with two of the latter’s units.
The deal itself is to further push towards the management and commercialization of OpRegen, the company’s leading pipeline program for diseases such as advanced dry age-related macular degeneration (dry AMD) with geographic atrophy (GA).
This sudden surge created heavy interest in Lineage, which received a $50 million upfront payment for the deal and expects another $620 million if certain clinical milestones are met.
Roche is a big fish that is putting its money in a smaller penny stock company, giving Lineage a good potential for the years to come. Its liquid assets of $68.7M are also expected to sustain its operations for the next two years.
The main sources of income for Lineage include licensing fees, royalties, revenue from joint ventures, and research funding.
According to its most recent financial report, for the three months that concluded on June 30, 2022, total revenues were around $4.6 million, which is a net increase of $4.0 million over the $0.5 million generated during the same time period in 2021.
The $50.0 million upfront license payment Roche made to us in the first quarter of 2022 was principally responsible for the increase in licensing fees recognized from deferred sales.
The cash runway will give Lineage ample time to achieve several near-term catalysts that could result in significant share price appreciation. For investors with a higher risk tolerance, LCTX stock could be a very compelling play.
With its strong fundamentals, LCTX could be a top biotech penny stock to buy now.
Orgenesis Inc (NASDAQ:ORGS)
Orgenesis Inc is personalized cell and gene therapy (CGTs) for different kinds of diseases, including cancer, genetic disorders, rare disorders, immunodeficiencies, and many more.
The Maryland biotech company has several therapies on its pipeline, including therapies for chronic pancreatitis and osteoarthritis available for clinical use.
In late last year, the company receive up to €32 Million from the Greek government for its POCare Centers, with operational collaborations with Johns Hopkins University in Maryland and Hospital Infantil Universitario Niño Jesús in Madrid.
Unlike most biotech companies stuck waiting for positive outcomes from their clinical trials, Orgenesis has working partnerships that can generate net income for the company.
These collaborations provide significant cost reductions for its operations while accelerating development of cell and gene therapy pipelines. These provide a potentially positive 2022 for Orgenesis from a development perspective, giving it good momentum.
In fact, its second quarter earnings report showed a revenue increase of $7.2 million, this is mainly because of the COVID-19 pandemic as POCare Centers were focused on SARS-CoV-2 testing.
Its global network supply chain also supported the development and commercialization of new cell therapies.
Overall, the company has collaborations with major names in the industry, which gives it a competitive advantage. Unlike its peers, Orgenesis is already generating revenue from its existing therapies and has a strong potential to grow in the coming years.
Investors can consider Orgenesis Inc as a good penny stock pick for the long-term growth potential it offers.
Sesen Bio Inc. (NASDAQ: SESN)
Sesen Bio Inc. develops next-generation antibody-drug combination therapies to treat cancer.
Its shares spiked after the company announced on October 20 that the FDA had granted its request to hold a Type A meeting to discuss issues raised in the complete response letter (CRL) for Vicineum.
As of June 30, 2022, the firm had $161.2 million in cash, cash equivalents, and marketable securities, up from $151.1 million in June 30, 2021.
Following the decision to halt further development of Vicineum in the US, Sesen Bio stated on July 20, 2022 that a reorganization plan had been approved in order to lower operational costs and better match its staff with the demands of the business.
By the conclusion of the 2022 fourth quarter, the restructuring plan’s execution should be mostly finished. This will leave the company with 72 full-time equivalent employees. The workforce reduction is estimated to result in $5-$6 million in cost savings annually.
Sesen Bio’s shares fell sharply after the announcement of the CRL for Vicineum, but have since recovered somewhat on news of the restructuring plan.
With a market cap of $131 million and no debt, the company is well-positioned to continue developing its pipeline and bring new cancer treatments to market.
Investors interested in biotech penny stocks may want to keep an eye on Sesen Bio as it continues to progress its pipeline and execute on its cost-saving measures.
VBI Vaccines (NASDAQ: VBIV)
Currently, vaccines are a popular topic within investing circles, and VBI Vaccines has benefited from this.
VBI is a pioneer in what is known as virus-like particle (VLP) technology, currently pushing the development of its VBI-2901 and VBI-2902, which are variants of the COVID-19 vaccine.
However, its predecessor PreHevbrio has been licensed to Merck (NYSE:MRK) for $30 million upfront, as well as tiered royalties based on sales. This was a big vote of confidence in the company by one of the largest pharma companies in the world.
VBI’s share price has increased from $3 to over $7 since June 2021, and with more good news on the horizon for its COVID-19 vaccine candidates, there is a good chance that this trend will continue.
Especially after its US launch of PreHevbrio, VBI Vaccines is a company to watch in the coming months, especially for penny stock investors.
Despite the fact that there are many COVID-19 vaccinations from pharmaceutical firms, most are showing to be at least partially useless against newer strains of the virus.
In that the eVLP (enveloped virus-like particle) approach may easily target both known and new strains, VBI Vaccines’ work with VBI-2902a is encouraging.
The medication is being study as part of what is known as an adaptive phase 1/2 clinical, which permits mid-trial modifications rather than imposing complete restarts of testing where such modifications may be performed safely.
This immunology firm has promising preclinical vaccines in its pipeline. Positive news about its vaccine variants should give VBI a good chance to move ahead, especially as the threat of COVID-19 continues to ravage the world.
If you’re new to investing in biotech, you might want to check out small-cap vaccine companies first, as this industry has withstood the test of time.
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More Top Biotech Stocks Under $5
Regulus Therapeutics Inc. (NASDAQ: RGLS)
Regulus Therapeutics Inc. is a biopharmaceutical company specializing in developing microRNA-targeting therapeutics to treat rare disorders and is currently advancing programs in renal and hepatic diseases.
This is a solid option if you want to give your penny stock portfolio exposure to the pharm industry. Over the last four quarters, the company has surpassed the consensus of EPS estimates three times.
In September, the company announced that the 2021 Lasker-Koshland Special Achievement Award in Medical Science had been awarded to one of its directors, David Baltimore, Ph.D.
Additionally, $15.4 million was raised by Regulus Therapeutics’ at-the-market (ATM) facility, extending its expected cash runway into the fourth quarter of 2022.
The company is currently focusing on developing RGLS8429, its newest treatment candidate for Autosomal Dominant Polycystic Kidney Disease (ADPKD).
Lastly, the Phase 1 SAD research of RGLS8429 for the treatment of ADPKD began dosing its first patient in early June 2022, according to a company announcement.
In a healthy volunteer population, the safety, tolerability, and pharmacokinetics of RGLS8429 will be evaluated. This will be the first study of oral, microRNA-targeted therapy in patients with ADPKD.
Investors seem to be optimistic about the company’s prospects as well. With a market cap of just $22 million, this could be a biotech penny stock to watch in the coming months.
Kintara Therapeutics, Inc. (NASDAQ: KTRA)
Kintara Therapeutics, Inc. is a clinical-stage biotechnology firm that focuses on developing and commercializing new cancer therapies. The company is carrying out several clinical trials on brain tumors and solid tumors.
In January 2022, Kintara received a grant from the National Research Fund and Cancer Foundation Luxembourg to support its research towards the mechanism of action of VAL-083 on glioblastoma.
VAL-083 is the top program in its pipeline, reaching Phase 2 in several clinical trials against its many cancer-related activities, including brain tumor and ovarian cancer.
The grant should give the company some leeway into its studies but it needs more than this to have its value move from its all-time low. Earlier in 2021, it widened access to clinical trials in the U.S. by opening new centers for glioblastoma (GBM) patients.
With future dividends excluded, Kintara has around 18,382 outstanding shares of Series C Preferred Stock exchangeable into 15.8 million shares of common equity to date.
Together with its recent Equity Purchase Agreement for Up to $20 Million with Lincoln Park Capital Fund, LLC, Kintara has some financial runway to keep executing on its plan.
Kintara’s focus on brain tumors gives it a clinical edge that could make it a key player in the industry if its drugs prove to be effective. For now, it is one of the best biotech penny stocks to watch.
EntSera Bio Ltd. (NASDAQ: ENTX)
Entera Bio is a biotechnology company currently conducting clinical trials that attempt to enhance the absorption of large molecules and biologics in the GI tract using its proprietary technology.
Its stock price has risen 248% during the past year, resulting in solid gains for shareholders. Entera Bio has a market cap of $133 million and spent $8.6 million last year, or 6.5 percent of its stock market value.
Given that this is such a low number, it can potentially fund another expansion. The company can do this by issuing new shares or possibly taking out a loan.
Entera started 2022 with a positive end-of-phase 2 meeting with the FDA, agreeing to a Phase 3 12-month study with lumbar spine BMD.
If the company succeeds in its study, its EB613 drug should be the first oral anabolic treatment for osteoporosis and will provide solid potential gains for the company.
In line with this development, Entera proposed a registrational protocol for EB613 to the U.S. Food and Drug Administration last July. This will push through with the Phase 3 clinical trials.
The firm’s Investigational New Drug application for EB613 was recently allowed by the FDA and is already in effect. With this, Entera can now proceed to initiate a pivotal Phase 3 clinical study in patients with osteoporosis.
Osteoporosis affects an estimated 200 million women worldwide and often leads to fractures, disability, and mortality. There are currently no approved oral treatments for the condition in the United States.
If you’re looking for biotech penny stocks with upside potential, Entera Bio Ltd. (NASDAQ: ENTX) is definitely worth considering.
Voyager Therapeutics (NASDAQ: VYGR)
Voyager Therapeutics Inc. is a clinical-stage gene therapy company working on therapies for severe neurological diseases.
A licensing and partnership agreement between the corporation and Neurocrine Biosciences Inc. covers the research, development, and commercialization of adeno-associated virus-based gene therapy products.
It also has strategic partnership agreements with ClearPoint Neuro Inc. and the University of Massachusetts as well as collaborations with Fujifilm Diosynth Biotechnologies and Thermo Fisher Scientific that help develop its gene therapy initiatives.
Voyager is now working on gene treatments using its unique AAV capsids, which have the potential to be more consistently on-target while reducing the danger of dose-limiting toxicities.
In addition, the company, which has a large preclinical pipeline of second-generation and innovative programs, recently signed an arrangement with Pfizer.
Pfizer will pay Voyager $30 million for transgene-specific access to its innovative AAV capsids, plus option exercise fees, milestone payments, and product royalties totaling up to $600 million.
This deal will almost certainly result in further investments and expansion prospects for the organization.
It also announced its priority treatment pipeline, concentrating on gene therapies for GBA1 Parkinson’s and SOD1 ALS as well as tau antibodies for Alzheimer’s disease.
During it’s recent Q2 report, pipeline treatment programs for Friedreich’s Ataxia and Huntington’s disease showed positive early data.
Voyager believes that its technology can cross the blood-brain barrier, making it unique in the gene therapy space. This is a significant advantage, as most other companies are working on ways to get around this obstacle.
This is an important step forward, as it means that the company is one step closer to starting clinical trials. With a market cap of $235 million, Voyager Therapeutics is definitely a biotech penny stock to watch in the coming months and years.
Enzolytics Inc. (OTC: ENZC)
Enzolytics Inc. is a biotechnology company that develops and commercializes medications based on proprietary proteins to treat a variety of severe infectious diseases, including HIV/AIDS.
The company is working to commercialize the IPF’s licensing rights for Hepatitis C and AIDS treatment.
In addition, Enzolytics has produced a cell line that creates human monoclonal antibodies that target and destroy the HIV virus, as well as clinically proven anti-HIV treatments.
The company recently announced a merger with BioClonetics Immunotherapeutics, which possesses the capability to generate completely human monoclonal antibodies against a variety of infectious diseases.
This move will allow the company to expand its reach while continuing to produce on a massive scale, which could help its value to rise.
It is currently trading at around $0.05 with a market cap of $128 million, other investors believe that this company has a lot of potentials and is worth watching.
Once its products get approved, the price could jump to $0.50 or more per share. The market for its products is large and growing, so there’s definitely potential here for big gains.
What You Should Know About the Biotech Industry
It was innovation that kept biotech penny stock so profitable throughout the greatest economic downturn in decades.
Thanks to the confluence of biological and technological breakthroughs, the number of assets moving into clinical trials continues to rise, and further waves of innovation are on the way.
For example, many biotech companies and the pharmaceutical sector as a whole are now working to combat the COVID-19 pandemic. Biotechs and pharma firms have a combined pipeline of more than 250 vaccine candidates and a similar number of medicines.
The Biotech industry changes in value according to the information that comes out regarding their products and pipelines. Much of their value relies on stock catalysts, especially how their collaborations and their clinical trials work.
Biotech companies live and die by FDA approvals and rejections, which can help spike stock value during approval periods and drop values deeply during trial rejections.
Should You Buy Biotech Stocks?
The biotech sector is a growing industry, and for years to come, COVID-19’s biotech tailwinds will continue to blow. As such, these biotech stocks under $5 can be great opportunities for all traders.
This field is extremely diverse and has a variety of applications worth investing in, including:
Treating skin diseases
And much more
Remember that if you’re looking for significant returns in the biotech industry, there’s a good chance you’ll stumble upon some investments that will leave you reeling from the losses along the way.
Biotech companies are more prone to volatility compared to other stocks, mostly due to their stock catalysts. During periods of lull, biotech companies keep their values until stock market changes push them up or down.
So you should only put up as much money as you can afford to lose and do your due diligence before investing in biotech stocks.
Where to Buy Biotech Penny Stocks
Most of the biotech stocks mentioned above can be bought and sold on the New York Stock Exchange and NASDAQ. There are several excellent stock market investing apps, but Public.com takes a more community-focused approach than others.
In addition to commission-free trading, the platform’s robust social features let you follow other traders and see why they’re buying or selling a stock. Alternatively, you can buy from investment apps like Robinhood or WeBull.
However, not all the stocks within the biotech industry may be available for purchase on these platforms, so you might need to trade over the counter.
Biotech Stocks Under 5 Bucks: Final Words
In the ever-changing world of biotechnology, it’s essential to stay on top of the latest stock market news, developments, and trends so you don’t miss out on the next big innovation.
Demand for biotech products will continue to rise, and the companies on our list could potentially profit from it. Regardless, make sure to do your due diligence before investing in any high risk biotech shares on the penny stock market.
Biotech Penny Stocks Frequently Asked Questions (FAQ)
Here are some of the most frequently asked questions online about biotech penny stocks.
What Is Biotech Stock?
A biotech stock is a stock related to a company that deals with the development of drugs and diagnostics technologies for disease treatment. Most biotech companies grow in value as they successfully develop treatment procedures, with stock growths reliant on breakthroughs, financial grants, and public-private partnerships.
Is It Good To Invest In Biotech?
Biotech is a great industry to invest in if you want a consistent stock that doesn’t need a lot of monitoring. At the same time, you want to ensure that you get the freshest stock market news with biotech firms, as investors sell off at the first sign of trouble.
What Is The Best Biotech Stock To Buy Right Now?
Among biotech penny stocks, Orgenesis Inc is the best on the list right now. Orgenesis has promising potential because of having pipeline programs that are ready for partnerships with different healthcare providers. In fact, its second-quarter earnings report showed a revenue increase of $7.2 million.
Why Are Biotechnology Stocks Falling?
Biotech stocks can fall at a moment’s notice due to industry or company information known as stock catalysts. While most firms have investment growths, sales numbers, and year-on-year growth reports as their catalysts, biotechnology firms rely on clinical trial results and FDA INDs.
Is Biotech The Next Big Thing?
Publicly traded companies in the biotech industry are racing to resolve not only the COVID-19 virus but also many chronic issues that can provide long-term relief to sufferers, including age-related disorders, cancer, and regenerative therapies, making it one of the next big things in the market.