In the United States, the healthcare sector has kicked off on a high note in 2019. However, the healthcare sector’s two-month-long rally has slowed down a bit in the last few trading sessions.
Keeping this recent dip in mind, Motley Fool contributors think that Canopy Growth Corporation, MyoKardia, and Blueprint Medicines are worth buying this month.
Here’s why you must buy the aforementioned healthcare stocks right now:
Canopy Growth Corporation
After a blistering start this year, Canopy Growth Corporation, formerly called Tweed Marijuana Inc., has seen its shares pullback by almost 6% since the release of its third-quarter earnings a week ago. Canopy’s shares are repaying some of their stately gains for two reasons:
- Minor spreadsheet error
- New fermentation technology might undermine dried flower and cannabis extract rates in near future.
Having said that, investors may look at these reasons to consider purchasing some shares of this company. After all, this top pot company of the cannabis space has not been hit by any major crisis of its own. This financial error does not change its underlying principles and growth. Additionally, cannabis enthusiasts will remain loyal to natural products even if cheaper, synthetic versions become available.
When it comes to healthcare research and development, most of the effort is made on genetic disorders, cancer, diabetes, etc. Not much attention is given on the body’s mechanical systems, such as the heart. With the mission to research, discover, develop, and commercialize targeted treatments for serious and rare cardiovascular diseases, MyoKardia is involved in much-needed research to the heart disease.
Researchers of MyoKardia are in the phase of three clinical trials of a lead candidate Mavacamten for a heart ailment called obstructive hypertrophic cardiomyopathy, a condition in the heart muscles thicken, making it difficult for the heart to pump. One in 500 has this type of heart ailment, according to the National Institutes of Health.
Looking at the incidence rate of the condition, it is certainly worth discovering, researching and developing a good treatment. This heart ailment is often treated with beta-blockers and calcium-channel blockers, which do not directly address the core problem with the heart. Mavacamten offers hope for a true treatment, as it addresses the core issue with the heart.
What makes you buy MyoKardia shares is that its shares are trading low, giving you more returns in near future. The business is currently unprofitable, making it still a high-risk investment. However, that could change if Mavacamten delivers what is expected when it comes to treating obstructive hypertrophic cardiomyopathy.
Blueprint Medicines has been developing precision drugs that target specific mutations of cancer. By midyear, the company expects to file its first drug – avapritinib – for the approval from the FDA. Avapritinib can deliver promising results when it comes to treating gastrointestinal stromal tumors (GIST) and systematic mastocytosis (SM).
Clinical data from the SM trials showed that avapritinib had an overall response of 83% and GIST trials showed an overall response of 86%.
Blueprint Medicines has also been working on BLU-667, a possible treatment for a type of lung cancer, thyroid cancer, and other cancers. An application for FDA approval is expected in 2020. Having said all of that, there is no guarantee that these drugs will do wonders; however, if they do, you can expect significant sales.