In this article, we will examine the Top 8 Long-Term Biotechnology Stocks to Buy.
Momentum in biotechnology stocks is accelerating after years of underperformance. The NASDAQ biotechnology stocks have returned over 34% in the past six months, while the S&P 500 Biotechnology Select Industry index has rallied 49%. The outperformance dwarfs the S&P 500’s 26% gains over the same period, affirming renewed risk-taking in the sector.
Optimism that President Donald Trump will ease regulations in the sector and spur momentum in the capital markets has helped fuel the rally. Similarly, positive clinical trial data, new regulatory approvals, and drug launches have contributed to the upward trajectory.
Analysts at Barclays attribute the renewed focus on biotech to a surge in mergers and acquisitions in the sector, as large-cap companies look to secure their pipeline assets. Likewise, scientific advancements are increasingly opening new paradigms in the treatment of a range of diseases, further strengthening companies’ prospects.
“Opportunities are knocking as we look to next waves of innovation in biotech,” analysts led by Etzer Darout noted, arguing that its new coverage list offers exposure to this backdrop.
Amid significant year-to-date gains, the biotechnology sector remains about 40% below its pandemic peak. Consequently, it is one of the few areas of the market reasonably priced at a time when overall valuations have gotten out of hand. In contrast, the biotechnology sector is trading below its historical average, underscoring significant upside potential.
While valuations around biotechs remain subdued, the sector has always required high risk tolerance. That’s because companies that drive medical innovation and develop therapies that can transform the healthcare sector offer long-term growth potential.
The prospect of further US interest rate cuts is giving believers optimism about the biotechnology sector’s outperformance.
“With the potential for interest rates to be cut more, you’re going to see a loosening up, especially with the biotech sector sentiment getting slightly better,” said Hartaj Singh, founding partner of Tecumseh Partners.
With that in mind, let’s take a look at some of the top long-term biotechnology stocks to buy.
Our Methodology
To compile our list of top long-term biotechnology stocks to buy, we used the Finviz screener. We screened biotechnology stocks with earnings growth of more than 20% over the past 5 years and positive expectations of earnings growth over the next 5 years. We also focused on stocks with an upside potential of more than 20% as of October 28 and that were popular among elite hedge funds as of Q2 2025. Finally, we ranked the stocks in ascending order based on the number of hedge funds that hold stakes in them.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research shows we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
Top Long-Term Biotechnology Stocks to Buy
8. Tonix Pharmaceuticals Holding Corp (NASDAQ:TNXP)
EPS Growth Past 5Y: 73.03%%
EPS Growth Next 5Y: 88.07%
Number of Hedge Fund Holdings: 2
Stock Upside Potential: 252.82%
Tonix Pharmaceuticals Holding Corp (NASDAQ:TNXP) is one of the top long-term biotechnology stocks to buy. On October 17, Tonix Pharmaceuticals (NASDAQ:TNXP) presented encouraging preclinical data for its investigational mpox and smallpox vaccine candidate, TNX-801, at the World Vaccine Congress Europe 2025.
The live, attenuated horsepox-based vaccine elicited strong immune responses, provided long-term protection, and demonstrated favorable safety across multiple animal models. A single dose provided durable immunity for at least 14 months and was well-tolerated across various delivery methods. Despite promising results, Tonix remains unprofitable, and analysts do not expect profitability this year.
TNX-801 is designed to be minimally replicative and may offer advantages over existing vaccines. The company has also engaged the FDA and partnered with the Kenya Medical Research Institute to pursue a Phase I clinical trial. It is also exploring microneedle patch technology to simplify future vaccine administration.
Tonix Pharmaceuticals Holding Corp (NASDAQ:TNXP) is a biopharmaceutical company that develops and commercializes therapies and vaccines for various diseases. Its work focuses on four main areas: central nervous system disorders, immunology, infectious diseases, and rare diseases. The company also markets existing products, such as Zembrace SymTouch and Tosymra, for the treatment of acute migraine headaches.
7. Assembly Biosciences, Inc. (NASDAQ:ASMB)
EPS Growth Past 5Y: 31.58%
EPS Growth Next 5Y: 52.43%
Number of Hedge Fund Holdings: 4
Stock Upside Potential: 33.38%
Assembly Biosciences, Inc. (NASDAQ:ASMB) is one of the top long-term biotechnology stocks to buy. On October 14, H.C. Wainwright reaffirmed its Buy rating and $50 price target on Assembly Biosciences (NASDAQ:ASMB) following the company’s presentation of interim data for ABI-5366, a long-acting oral treatment for recurrent genital herpes.
Presented data showed strong antiviral activity, favorable tolerability, and a dosing profile suitable for weekly or monthly administration. The firm views these results as a key validation of Assembly’s helicase-primase inhibitor platform and believes they reduce the risk of advancing ABI-5366 into Phase 2 trials. The company plans to initiate Phase 2 clinical studies by mid-2026, signaling continued progress in its antiviral pipeline.
Assembly Biosciences, Inc. (NASDAQ:ASMB) is a biotechnology company that develops and commercializes small-molecule therapies for serious viral diseases, with a particular focus on chronic hepatitis B virus (HBV) and herpesviruses.
6. Sellas Life Sciences Group Inc. (NASDAQ:SLS)
EPS Growth Past 5Y: 45.94%
EPS Growth Next 5Y:20.63%
Number of Hedge Fund Holdings: 5
Stock Upside Potential: 266.49%
Sellas Life Sciences Group Inc. (NASDAQ:SLS) is one of the top long-term biotechnology stocks to buy. On October 27, SELLAS Life Sciences (NASDAQ:SLS) announced the immediate exercise of warrants for 22.4 million shares. The company raised $31 million in gross proceeds from the offering.
Investors who exercised the warrants, issued in March and August of last year, are poised to receive new registered warrants to purchase up to 22.4 million shares at $2 per share. The new warrants will be exercisable immediately and will expire five years from issuance.
The offering comes as the company plans to host a virtual R&D Day on Wednesday, October 29, 2025, featuring opinion leaders and management to discuss an acute myeloid leukemia treatment. The company is developing its lead product candidate, GPS, in addition to SLS009, a CDK9 inhibitor for acute myeloid leukemia. Preliminary results indicate that CK9 inhibition with SLS009 could play a role in the treatment of T-cell prolymphocytic leukemia (T-PLL).
Sellas Life Sciences Group Inc. (NASDAQ:SLS) is a biotechnology company that develops novel cancer therapies. Its lead candidate is galinpepimut-S (GPS), an immunotherapy targeting the WT1 protein for various cancers, and SLS009, a CDK9 inhibitor for certain types of leukemia.
5. Avalo Therapeutics, Inc. (NASDAQ:AVTX)
EPS Growth Past 5Y: 56.49%%
EPS Growth Next 5Y: 40.60%
Number of Hedge Fund Holdings: 12
Stock Upside Potential: 89.51%
Avalo Therapeutics, Inc. (NASDAQ:AVTX) is one of the top long-term biotechnology stocks to buy. On October 17, Piper Sandler analyst Yasmeen Rahimi reaffirmed her Buy rating on Avalo Therapeutics Inc. (NASDAQ:AVTX), maintaining a price target of $48, which implies a substantial upside potential of 167.86% from the stock’s current trading levels.
The buy stance underscores confidence in Avalo’s strategic direction and pipeline progress as it makes progress in immune dysregulation therapies. The analyst’s optimism comes on the heels of recent leadership changes, strategic collaborations, and clinical pipeline development. Avalo’s focus on novel immunology targets and its ability to execute on development milestones were central to Piper Sandler’s bullish outlook.
Avalo Therapeutics, Inc. (NASDAQ:AVTX) is a biotechnology company focused on developing treatments for immune-mediated inflammatory diseases. Its lead product candidate, AVTX-009, is an anti-IL-1β antibody in a Phase 2 clinical trial for hidradenitis suppurativa (HS). The company’s pipeline also includes other assets, such as quisovalimab and AVTX-008, which are designed to modulate the immune system.
4. Savara Inc. (NASDAQ:SVRA)
EPS Growth Past 5Y: 24.35%
EPS Growth Next 5Y: 34.32%
Number of Hedge Fund Holdings: 18
Stock Upside Potential: 119.19%
Savara Inc. (NASDAQ:SVRA) is one of the top long-term biotechnology stocks to buy. On October 2, Savara Inc. (NASDAQ:SVRA) announced that its partner, TrilliumBiO, will present data on the development of a dried-serum assay at the upcoming CHEST 2025 conference.
TrilliumBiO is developing a dried-serum assay to enhance the detection of GM-CSF antibodies and aid in diagnosing autoimmune pulmonary alveolar proteinosis (aPAP). Additionally, Savara is to make a presentation on its investigational treatment, molgramostim, a recombinant human GM-CSF, currently in Phase 3 development for aPAP.
The presentation focuses on the company delivering positive results from the Phase 3 IMPALA-2 trial of molgramostim for treating autoimmune pulmonary alveolar proteinosis (aPAP). The results underlined the treatment’s ability to enhance lung diffusing capacity.
Savara Inc. (NASDAQ:SVRA) is a clinical-stage biopharmaceutical company focused on developing therapies for rare respiratory diseases. Its lead product candidate is molgramostim (MOLBREEVI), an inhaled drug in Phase 3 development for autoimmune pulmonary alveolar proteinosis (aPAP), a rare lung disease.
3. Novavax, Inc. (NASDAQ:NVAX)
EPS Growth Past 5Y: 25.88%
EPS Growth Next 5Y: 46.55%
Number of Hedge Fund Holdings: 24
Stock Upside Potential: 34.98%
Novavax, Inc. (NASDAQ:NVAX) is one of the top long-term biotechnology stocks to buy. On October 24, Cantor Fitzgerald initiated coverage of Novavax, Inc. (NASDAQ:NVAX) with an Overweight rating and a $18 price target.
Cantor Fitzgerald pointed to Nuvaxovid, Novavax’s protein-based COVID-19 vaccine, as a central asset in its evolving strategy. The company has moved from direct commercialization to a licensing model, aiming to generate revenue through partnerships tied to its Matrix-M adjuvant and vaccine portfolio.
Earlier, on October 7, the company completed the transfer of its COVID-19 vaccine, Nuvaxoid, to Sanofi. With the transfer, the company has given Sanofi full responsibility for commercial and regulatory activities in the EU.
Novavax is poised to receive a $25 million milestone payment. The transfer also enables collaboration and a license agreement between the two companies.
“Novavax continues to steadily advance our corporate growth strategy while delivering on our partnership agreement,” said CEO John C. Jacobs. “The successful transfer of our EU marketing authorization to Sanofi is yet another step forward in ensuring global access to our protein-based, non-mRNA COVID-19 vaccine.”
Novavax is also entitled to additional future milestones and royalty payments. The company is entitled to a $75 million milestone payment upon Sanofi’s technology transfer of its manufacturing process for the vaccine. The company could receive up to an additional $350 million in future milestone payments.
Novavax, Inc. (NASDAQ:NVAX) is a biotechnology company that develops and commercializes innovative vaccines to prevent serious infectious diseases. Its products are protein-based, utilizing recombinant nanoparticle technology and its proprietary Matrix-M adjuvant to enhance the immune response.
2. Verastem, Inc. (NASDAQ:VSTM)
EPS Growth Past 5Y: 31.36%%
EPS Growth Next 5Y: 34.23%
Number of Hedge Fund Holdings: 25
Stock Upside Potential: 90.82%
Verastem, Inc. (NASDAQ:VSTM) is one of the top long-term biotechnology stocks to buy. On October 23, Verastem, Inc. (NASDAQ:VSTM) reported positive preliminary results from an ongoing phase 1/2a dose-escalation trial of vs-7375, an oral KRAS G12D (on/off) inhibitor, in patients with KRAS G12D-mutant solid tumors.
The preliminary safety and tolerability data indicate that VS-7375 can be administered at efficacious doses to manage gastrointestinal side effects. Following encouraging preliminary data, the company has initiated patient enrollment for the first dose-escalation combination cohort.
“While still early, we are pleased to see anti-tumor activity among pre-treated patients with advanced pancreatic cancer and other solid tumors. As we continue monotherapy dose escalation, we are excited to open the combination cohort evaluating VS-7375 with cetuximab just months after trial initiation,” said Dan Paterson, president and chief executive officer of Verastem Oncology.
Subject to the outcome of the Phase 1 dose escalation, Verastem intends to initiate a combination expansion cohort in colorectal cancer. It also plans to select the recommended Phase 2 dose and advance subsequent efficacy and safety analysis in patients with advanced pancreatic ductal adenocarcinoma (PDAC) and non-small cell lung cancer (NSCLC).
Verastem, Inc. (NASDAQ:VSTM) is a biopharmaceutical company that develops and commercializes new medicines for patients with cancers driven by the RAS/MAPK signaling pathway. It develops novel small-molecule drugs, including inhibitors targeting RAF/MEK, FAK, and KRAS G12D.
1. Rezolute, Inc. (NASDAQ:RZLT)
EPS Growth Past 5Y: 22.65%
EPS Growth Next 5Y: 50.62%
Number of Hedge Fund Holdings: 25
Stock Upside Potential: 55.93%
Rezolute Inc. (NASDAQ:RZLT) is one of the top long-term biotechnology stocks to buy. Wedbush analyst Yun Zhong reaffirmed a Buy rating on Rezolute Inc. (NASDAQ:RZLT) stock on October 23, citing strong confidence in the company’s lead candidate, ersodetug.
Currently in Phase 3 trials for congenital hyperinsulinism (cHI), the drug has shown promise in addressing a significant unmet need through its novel insulin receptor-blocking mechanism. Zhong also highlighted Rezolute’s favorable competitive position, with ersodetug poised to gain substantial market share if approved. Additional opportunities in related conditions, such as tumor-induced hypoglycemia, further support a positive long-term outlook for the company.
Rezolute Inc. (NASDAQ:RZLT) is a biopharmaceutical company that develops therapies for rare and metabolic diseases. Its primary focus is on creating treatments for hyperinsulinism (HI), a rare genetic disorder that can cause dangerously low blood sugar, with its lead candidate being ersodetug.
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