In this piece, we discuss the 10 Hot Biotech Stocks Under $5 to Buy.

Biotech is having one of its strongest years in recent times, and the conditions driving that momentum are creating real opportunities for investors in early-stage names.

On June 4, 2026, CNBC reported that global biopharma M&A is on track for its strongest year since the pre-pandemic peak seven years ago. Dealmaking has already reached $106 billion across 201 deals, and if the current pace holds, total deal value could exceed $250 billion for the full year, according to PitchBook data. The average deal value has climbed to $527.3 million so far in 2026, up from $365 million in 2025.

Pharma giants are primarily targeting strategic acquisitions in the $1 billion to $5 billion range, with drug discovery dominating deal flow across oncology, metabolic disease, and central nervous system indications. The biotech ETF index XBI has risen more than 50% over the past 12 months, and the IPO window has reopened meaningfully.

A clear sign of that recovery came on June 9, 2026, when Reuters reported that Parabilis Medicines upsized its U.S. IPO to 33.3 million shares at a target valuation of up to $2.3 billion, after initially planning to sell 25 million shares. Its lead candidate, zolucatetide, is being evaluated across multiple solid tumors, with more than 150 patients dosed to date.

Meanwhile, on June 8, 2026, Reuters reported that Johnson & Johnson agreed to acquire Firefly Bio for $1 billion in cash to expand its oncology pipeline, targeting KRAS-driven tumors through Firefly’s protein-degrading platform.

Against this backdrop, let’s jump to our list of the 10 hot biotech stocks under $5 to buy.

Our Methodology

We used screeners to identify biotech stocks that have gained at least 50% in 2026 so far and have an average upside potential of at least 40%. We then narrowed our final selection to companies that have recently reported noteworthy developments likely to influence investor sentiment. These stocks are also favored by analysts and elite hedge funds. Our final list is ranked in ascending order based on upside potential.

Note: All data sourced on June 8, 2026.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Insider Monkey’s quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).

10. Whitehawk Therapeutics, Inc. (NASDAQ:WHWK)

Whitehawk Therapeutics, Inc. (NASDAQ:WHWK), featuring a year-to-date gain of 71.49% and upside potential of 68.70%, secures a spot on our list of hot biotech stocks under $5 to buy.

A busy period of pipeline and platform news has kept the clinical-stage antibody drug conjugate (ADC) company in focus, with fresh data at a major oncology conference arriving alongside a deal that extends its program runway.

A more recent development came at ASCO 2026, where Whitehawk Therapeutics, Inc. (NASDAQ:WHWK) presented a real-world analysis on May 30, 2026, supporting the therapeutic potential of targeting seizure-related homolog protein 6 with its next-generation ADC HWK-206 for the treatment of neuroendocrine tumors, including small cell lung cancer.

The analysis, conducted in collaboration with Tempus AI, showed SEZ6 demonstrates consistently high expression across disease stages and metastatic settings in SCLC, as well as enrichment in neuroendocrine-high SCLC subtypes. HWK-206 uses a biparatopic approach designed to potentially improve binding and internalization. An IND application for HWK-206 in SCLC and neuroendocrine tumors is expected to be submitted in mid-2026, with a Phase 1 start planned for the third quarter of 2026.

That followed a pipeline expansion announced on May 21, 2026, when Whitehawk Therapeutics, Inc. (NASDAQ:WHWK) entered an option agreement with Hangzhou DAC for access to the CPT113 linker-payload technology for use in up to five additional ADC programs, including dual-payload variations.

Under the agreement, Whitehawk Therapeutics, Inc. (NASDAQ:WHWK) retains global rights and full program control, and anticipates submitting IND applications for multiple new programs over the next 12 to 24 months. Phase 1 dose-escalation trials for HWK-007 and HWK-016 are currently enrolling, with data expected in the first half of 2027.

Whitehawk Therapeutics, Inc. (NASDAQ:WHWK) is a preclinical oncology company developing next-generation antibody-drug conjugates targeting PTK7, MUC16, and SEZ6, aiming to improve treatment outcomes for patients with difficult-to-treat cancers.

9. Iovance Biotherapeutics, Inc. (NASDAQ:IOVA)

While Iovance Biotherapeutics, Inc. (NASDAQ:IOVA) has gained 54.95% year-to-date, analysts continue to see 112.80% upside, helping it secure a spot on our list of hot biotech stocks under $5 to buy.

Two meaningful pipeline and regulatory developments arrived within days of each other, adding fresh momentum to Iovance Biotherapeutics, Inc. (NASDAQ:IOVA)’s expanding TIL therapy platform.

On June 03, 2026, Australia’s Therapeutic Goods Administration granted approval with conditions for Amtagvi (lifileucel) in previously treated advanced melanoma, making it the third marketing authorization for the therapy. The approval covers adult patients with unresectable or metastatic melanoma previously treated with a PD-1 blocking antibody and, if positive for a BRAF V600 mutation, a BRAF inhibitor with or without a MEK inhibitor. The TGA based its decision on safety and efficacy results from the global, multicenter C-144-01 trial. Australia carries the highest rate of melanoma globally, with an estimated 17,000 new cases diagnosed each year and more than 1,500 deaths annually. Iovance Biotherapeutics, Inc. (NASDAQ:IOVA) said it is in the process of authorizing its first Australian treatment center.

That followed an earlier pipeline update.

On June 01, 2026, the FDA granted an allowance to proceed with an investigational new drug application for IOV-5001, a next-generation IL-12-tethered TIL therapy. A Phase 1/2 basket trial is set to begin enrolling in the second half of 2026, targeting advanced colorectal, triple-negative, and estrogen receptor-low breast cancers, along with other solid tumors representing more than 100,000 U.S. deaths annually. IOV-5001 is engineered to express IL-12 only within the tumor and tether it to the cell surface to prevent release into the bloodstream, building on an earlier secreted IL-12 TIL therapy that showed a 63% confirmed objective response rate.

Iovance Biotherapeutics, Inc. (NASDAQ:IOVA) is a commercial-stage biopharmaceutical company pioneering tumor-infiltrating lymphocyte (TIL) therapies to treat cancer. By harvesting and multiplying a patient’s own immune cells, they create personalized immunotherapies designed to recognize and destroy solid tumors.