In this article, we will take a look at the 10 personalized medicine stocks billionaires are purchasing.
According to Allied Market Research, the global personalized medicine industry is set to expand from a value of $300 billion in 2021 to $869.5 billion by 2031, reflecting a compound annual growth rate (CAGR) of 11.2%. Personalized medicine, or precision medicine, takes into account the unique characteristics of every patient by focusing on their genetic and molecular makeup. By utilizing genetics, personalized medicine aims to identify and treat patients in a way that is more specific to their needs. The industry is expected to grow due to the global ageing population and an increasing number of patients worldwide with chronic diseases such as cancer and diabetes. According to the World Health Organization (WHO), cancer is among the leading causes of death globally. The disease was responsible for causing nearly one in six deaths, or around 10 million deaths, in 2020.
In addition to the rising incidence of chronic diseases, advancements in technology and the utilization of genetic databases are also acting as key drivers for the personalized medicine market and the genomics market. Experts think the application of precision medicine is expanding across multiple medical specialities, such as neurology, antiviral, and pulmonary. This usage diversification, along with more economies embracing personalized medicine, is presenting new opportunities for market growth and playing in favour of the best personalized medicine stocks such as Bristol-Myers Squibb Company (NYSE:BMY), Merck & Co., Inc. (NYSE:MRK), and Thermo Fisher Scientific Inc. (NYSE:TMO). In terms of market share, North America emerged as the leading region in the global personalized medicine industry in 2021. The region has been able to dominate the market due to a significant increase in regulatory approvals for precision medicine in the United States. Moving forward, the Middle East & Africa and the Asia Pacific regions are expected to observe an increase in their market share in the next 3 years.
Leading healthcare companies like Abbott Laboratories (NYSE:ABT) and Pfizer Inc. (NYSE:PFE) are playing an important role in the research and development of personalized treatments. You can read more about the 15 Best Healthcare Stocks To Buy Now here. Abbott Laboratories (NYSE:ABT) achieved a significant milestone in January 2020 as it obtained approval from the US Food and Drug Administration (FDA) for its Infinity Deep Brain Stimulation system. The system aims to target a specific region of the brain called the internal globus pallidus. The approval would help Abbott Laboratories (NYSE:ABT) in providing personalized and patient-centred treatments to individuals suffering from movement disorders. Furthermore, Ariel Precision Medicine, Inc. also formed a partnership with Mission Cure Holdings and Path BioAnalytics, Inc. in June 2020 to create personalized treatments for patients suffering from pancreatitis and other novel diseases that currently lack effective treatment options.
Photo by christina victoria on Unsplash
Our Methodology
We used Insider Monkey’s exclusive database of billionaire-owned stocks to shortlist the best personalized medicine stocks with the highest number of billionaire investors as of the first quarter of the year. We have included companies with significant exposure to the personalized medicine industry. The best personalized medicine stocks have been ranked in ascending order of the number of billionaires holding a stake in them. We have also included information regarding the total number of hedge fund investors in these companies as of Q1 2023.
10 Personalized Medicine Stocks Billionaires Are Loading Up On
10. AbbVie Inc. (NYSE:ABBV)
Number of Billionaire Investors: 13
Dollar Value of Billionaire Holdings: $1,137,918,033
Number of Hedge Fund Holders: 75
AbbVie Inc. (NYSE:ABBV) is a North Chicago, Illinois-based pharmaceutical company.
The researchers at AbbVie Inc.’s (NYSE:ABBV) precision medicine department are using cutting-edge technology to detect predictive markers. This is likely to improve their ability to understand molecular drivers of various diseases. In January, AbbVie Inc. (NYSE:ABBV) also entered into a partnership with Immunome, Inc (NASDAQ:IMNM) to develop new antibody-target pairs for the treatment of cancer.
Harding Loevner shared its stance on AbbVie Inc. (NYSE:ABBV) in its Q1 2023 investor letter. Here’s what the firm said:
“One of our two new additions to the portfolio is AbbVie Inc. (NYSE:ABBV), a US drugmaker best known for Humira, a medicine used to treat a variety of autoimmune diseases. AbbVie is building upon its maturing blockbuster Humira business by expanding its stable of autoimmune-disorder treatments with launches such as Skyrizi and Rinvoq, which have been well received and should support continued growth. Separately, we believe the slowdown in venture capital funding may foster more collaboration between biotechnology companies with promising, early-stage pipelines and large pharmaceutical companies. This may allow AbbVie to supplement its own pipeline at cheaper valuations than biotechs had commanded in recent years.”
9. Illumina, Inc. (NASDAQ:ILMN)
Number of Billionaire Investors: 13
Dollar Value of Billionaire Holdings: $583,459,363
Number of Hedge Fund Holders: 44
Illumina, Inc. (NASDAQ:ILMN) is a San Diego, California-based biotechnology company. The company is actively working in the field of precision medicine and making use of innovative technologies to develop treatments.
As of Q1 2023, 13 billionaires reported owning a stake worth over $583 million in Illumina, Inc. (NASDAQ:ILMN), justifying its inclusion in our list of the best personalized medicine stocks to buy now.
Here’s what Baron Funds said about Illumina, Inc. (NASDAQ:ILMN) in its Q1 2023 investor letter:
“Illumina, Inc. (NASDAQ:ILMN), the market leader in DNA sequencing technology, detracted from performance for the period held. During the quarter, activist investor Carl Icahn nominated three directors to the Illumina board and criticized the current management team’s decisions with respect to Grail, an acquisition that has developed an early cancer detection test called Galleri. Icahn is urging Illumina to sell the Grail business as soon as possible to eliminate the near-term earnings dilution and allow investors to participate in the core Illumina business. In early April, the FTC ordered the divestment of Grail. We exited our position early in the quarter.”
8. Pfizer Inc. (NYSE:PFE)
Number of Billionaire Investors: 13
Dollar Value of Billionaire Holdings: $1,566,408,143
Number of Hedge Fund Holders: 73
Pfizer Inc. (NYSE:PFE) has secured the eighth position on our list of the best personalized medicine stocks billionaires are purchasing.
Precision medicine is one of the four pillars of Pfizer Inc.’s (NYSE:PFE) oncology portfolio. In Q1 2023, Pfizer Inc. (NYSE:PFE) reported a Normalized Actual EPS of $1.23, surpassing the analysts’ estimates by $0.24. Furthermore, the company reported a revenue of $18.28 billion, beating the estimates by $1.79 billion.
Of the 943 hedge funds in Insider Monkey’s database, 73 funds reported owning a stake in Pfizer Inc. (NYSE:PFE) at the end of Q1 2023.
7. Moderna, Inc. (NASDAQ:MRNA)
Number of Billionaire Investors: 14
Dollar Value of Billionaire Holdings: $1,508,064,304
Number of Hedge Fund Holders: 40
Moderna, Inc. (NASDAQ:MRNA) is one of the leading biotechnology companies in the world. Moderna, Inc. (NASDAQ:MRNA) has a personalized cancer vaccine program which it claims to be effective in the treatment of advanced melanoma. The company is working on creating new vaccines to treat heart and other rare diseases as well.
Here’s what Baron Funds said about Moderna, Inc. (NASDAQ:MRNA) in its Q1 2023 investor letter:
“Moderna, Inc. (NASDAQ:MRNA) is a leader in the emerging field of mRNA-based vaccines and therapeutics and was one of the three main producers of the COVID vaccine. Shares fell during the quarter. We believe as COVID shifts away from pandemic status and becomes an increasingly commercial market (rather than government funded), there is increasing investor uncertainty around what a booster market could look like, which is pressuring shares. Looking beyond COVID, we think Moderna has the potential to disrupt the biopharmaceutical industry, from infectious disease vaccines to oncology, and we remain shareholders.”
Overall, 40 hedge funds were bullish on Moderna, Inc. (NASDAQ:MRNA), one of the best personalized stocks in the market, as of Q1 2023. Coatue Management was the leading hedge fund investor in the company during the first quarter, with over 6 million shares.
6. Biogen Inc. (NASDAQ:BIIB)
Number of Billionaire Investors: 14
Dollar Value of Billionaire Holdings: $1,500,077,602
Number of Hedge Fund Holders: 67
Biogen Inc. (NASDAQ:BIIB) is a Massachusetts, United States-based biotechnology company. Biogen Inc. (NASDAQ:BIIB) is at the sixth position on our list of the best personalized medicine stocks to buy now.
The company is working towards discovering groundbreaking therapies for individuals suffering from severe neurological disorders. In October 2022, Biogen Inc. (NASDAQ:BIIB) presented new data at the European Committee for Treatment and Research in Multiple Sclerosis (ECTRIMS) meeting, which focused on personalized treatments for people with multiple sclerosis. In Q1 2023, Biogen Inc. (NASDAQ:BIIB) posted an EPS of $3.4, surpassing the analysts’ estimates of $3.28. Click here to read the company’s earnings call transcript for Q1 2023.
In addition to Biogen Inc. (NASDAQ:BIIB), Bristol-Myers Squibb Company (NYSE:BMY), Merck & Co., Inc. (NYSE:MRK), and Thermo Fisher Scientific Inc. (NYSE:TMO) are also some of the best personalized medicine stocks attracting hedge fund investment as of the first quarter of the year.
5. Abbott Laboratories (NYSE:ABT)
Number of Billionaire Investors: 15
Dollar Value of Billionaire Holdings: $1,296,158,361
Number of Hedge Fund Holders: 70
Abbott Laboratories (NYSE:ABT) is an Illinois, United States-based healthcare company.
In Q1 2023, Abbott Laboratories (NYSE:ABT) posted revenue of $9.75 billion, surpassing the analysts’ estimates by $104.18 million. Furthermore, the company also managed to exceed the EPS estimates by 5 cents. Click here to read Abbott Laboratories’ (NYSE:ABT) earnings call transcript for the latest quarter.
Here’s what Polen Capital said about Abbott Laboratories (NYSE:ABT) in its Q1 2023 investor letter:
“As stated below in the portfolio activity section, Abbott Laboratories (NYSE:ABT) is expected to see roughly $6 billion in COVID test sales evaporate this year, creating a headwind for margins and underlying earnings per share. As long-term owners of the business, these test sales were never part of our original investment case. The core business, our primary focus, has a clear path of growing high single digits in 2023 with durable growth beyond, in our view. We believe the current price of 23x NTM P/E , while reasonable, is also misleading considering earnings this year will be artificially depressed because of the drop in COVID testing sales. On normalized earnings, the price is lower. We anticipate underlying EPS growth of at least low-teens over the next three to five years.
Lastly, we trimmed Abbott Laboratories, bringing it back to a more average position size and to also fund our increase in Thermo Fisher. Abbott is entering a year in which the company is expected to see approximately $6bn in COVID-19 test sales disappear, thus, creating a headwind for margins and EPS. That said, the core business has a clear path to growing high single digits in FY23. EPS grew at a 20% CAGR from 2019-2022, far beyond our expectations when we initiated our investment. Now, we expect a more normal growth rate of low teens EPS beyond this year. Further, management’s adeptness at allocating capital continues to impress us. We expect Abbott to drive top line growth without heavily investing in R&D and SG&A this year— management effectively “front-loaded” those investments in 2021 and 2022 when COVID test sales created a bolus of cash. We believe this should allow for leverage on the operating margin going forward. Combined, Abbott and Thermo Fisher now represent 7% of the Portfolio.”
4. Bristol-Myers Squibb Company (NYSE:BMY)
Number of Billionaire Investors: 15
Dollar Value of Billionaire Holdings: $477,264,538
Number of Hedge Fund Holders: 69
Bristol-Myers Squibb Company (NYSE:BMY) is at the fourth position on our list of the best personalized medicine stocks billionaires are purchasing.
In August 2022, Bristol Myers Squibb (NYSE:BMY) acquired Turning Point Therapeutics, Inc. (NASDAQ:TPTX), a precision oncology company, for $76 per share. Bristol-Myers Squibb Company (NYSE:BMY) made the acquisition of Turning Point Therapeutics, Inc. (NASDAQ:TPTX) to enhance its position in the field of precision oncology.
3. Merck & Co., Inc. (NYSE:MRK)
Number of Billionaire Investors: 17
Dollar Value of Billionaire Holdings: $1,403,465,639
Number of Hedge Fund Holders: 75
Merck & Co., Inc. (NYSE:MRK) is a New Jersey, United States-based pharmaceutical company.
At the end of Q1 2023, 17 billionaires reported owning a stake in Merck & Co., Inc. (NYSE:MRK), justifying its inclusion in our list of the best personalized medicine stocks to buy now. The 17 investors held a cumulative stake of over $1.4 billion in Merck & Co., Inc. (NYSE:MRK).
Here’s what Aristotle Capital Management, LLC said about Merck & Co., Inc. (NYSE:MRK) in its Q4 2022 investor letter:
“Founded in 1891 and headquartered in New Jersey, Merck & Co., Inc. (NYSE:MRK) is one the world’s largest pharmaceutical firms. The company’s drugs are used to treat conditions in a variety of areas, including oncology (~38% of revenue), vaccines (~19%), diabetes (~11%), animal health (~11%) and other (~21%). Merck produced over $48 billion in sales in 2021, just under half of which were generated in the United States. Within oncology, the firm’s immuno-oncology platform is becoming a major contributor to overall sales, driven by the blockbuster1 drug Keytruda. The company’s vaccine business is also significant and includes Gardasil for the prevention of HPV (the disease that can lead to cervical cancer in women), as well as vaccines for hepatitis B, pediatric diseases and shingles. In recent years, Merck has been shifting its focus toward unmet medical needs in specialty-care areas. As part of this shift in focus, in June 2021, Merck received $9 billion from the spinoff of its women’s health, established brands, and biosimilars businesses into the now independent, publicly traded company Organon…” (Click here to read the full text)
2. Johnson & Johnson (NYSE:JNJ)
Number of Billionaire Investors: 17
Dollar Value of Billionaire Holdings: $2,834,974,813
Number of Hedge Fund Holders: 86
Johnson & Johnson (NYSE:JNJ) is working actively to invest in the research and development of personalized treatments. The company, in collaboration with Janssen Research & Development LLC, initiated the Immunology Innovations QuickFire Challenge to encourage advancements in precision medicine.
As of Q1 2023, 86 hedge funds held a stake in Johnson & Johnson (NYSE:JNJ). D E Shaw raised its stake in Johnson & Johnson (NYSE:JNJ) by 86% during the first quarter of the year.
1. Thermo Fisher Scientific Inc. (NYSE:TMO)
Number of Billionaire Investors: 19
Dollar Value of Billionaire Holdings: $2,384,906,137
Number of Hedge Fund Holders: 98
Thermo Fisher Scientific Inc. (NYSE:TMO) has secured first place on our list of the best personalized medicine stocks to invest in.
In 2018, Thermo Fisher Scientific Inc. (NYSE:TMO) opened its U.S. Precision Medicine Science Center (PMSC) in Cambridge, Massachusetts. Thermo Fisher Scientific’s PMSC is at the forefront of advancing precision medicine by enabling advanced personalized healthcare treatments.
Here’s what Polen Capital said about Thermo Fisher Scientific Inc. (NYSE:TMO) in its Q1 2023 investor letter:
“During the quarter, we also raised our position in Thermo Fisher Scientific Inc. (NYSE:TMO). The company effectively sells pickaxes and shovels to the life sciences industry, is well balanced, is durable, and has a strong management team at the helm. We took an initial position recently and are now raising it to an average weight within the Portfolio. During the most recent quarter, the company grew revenue 11% in constant currency. Core organic growth, excluding COVID-19 testing revenue which fell 16%, grew a very strong 13%. This company plays an important role within the Portfolio as a “safety” within our growth spectrum approach and over the next five years we expect EBITDA and EPS to grow at roughly low double digits and low teens, respectively.”
Suggested Articles:
- 10 DNA Stocks Billionaires Are Loading Up On
- 11 Best Hydrogen and Fuel Cell Stocks To Buy
- 11 Best Home Builder Stocks To Buy Now
Disclosure. None: 10 Personalized Medicine Stocks Billionaires Are Loading Up On is originally published on Insider Monkey.
