Biotech Giants on the Rise: Vertex and Moderna Offer Long-Term Potential

Equity markets had a robust performance in January, a trend characteristic of the start of the year. However, long-term investors should remember that one month of returns—whether positive or negative—rarely dictates future success. The key is to invest in companies with the potential to excel over time, regardless of their short-term performance.

To demonstrate this concept, we examine two biotech stocks that have taken different paths in 2023: Vertex Pharmaceuticals (NASDAQ: VRTX) and Moderna (NASDAQ: MRNA). Both companies may deliver significant returns for investors who are willing to be patient.

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VRTX data by YCharts

Vertex Pharmaceuticals: Seeking New Heights

Vertex Pharmaceuticals is experiencing a strong start to the year. On January 30, the U.S. Food and Drug Administration approved Journavx, marking it as the first non-opioid oral pain signal inhibitor to receive regulatory approval. The market reacted positively, with Vertex’s shares soaring in response. This innovation addresses a significant need, especially given the complications opioids have generated in many communities across the U.S.

Vertex’s portfolio includes approved treatments for pain management, sickle cell disease (SCD), transfusion-dependent beta-thalassemia (TDT), and cystic fibrosis (CF), which remains its core focus. The company reported third-quarter revenues of $2.77 billion, reflecting a 12% increase year-over-year.

Looking ahead, Vertex anticipates sales growth driven by its new therapies, including Journavx, the next-generation CF treatment Alyftrek, and Casgevy for SCD and TDT. Moreover, Vertex is advancing several promising late-stage clinical trials, including inaxaplin for kidney disease and povetacicept for Iga nephropathy. Vertex’s rich pipeline promises further upside, making it a compelling biotech stock for continued investment.

Moderna: Challenges and Opportunities

Moderna’s current challenges stem from its explosive rise during the pandemic. Having gained recognition in 2020 for its COVID-19 vaccine development—an achievement that eluded many rivals—the company’s stock and financial outlook have trended downward as the pandemic has lessened.

Despite this, the company possesses innovative capabilities that could yield strong long-term returns. Moderna’s mRNA technology is particularly promising, allowing faster vaccine development for various infectious diseases where solutions remain scarce. This advantage positions the company favorably as it works on new products.

Moderna’s recent achievements include approval for mRESVIA, a vaccine targeting respiratory syncytial virus, and encouraging phase 3 results for a dual coronavirus and flu vaccine. Additionally, its personalized cancer vaccine is undergoing phase 3 trials, having previously shown significant promise in combination with Merck‘s Keytruda, reducing melanoma recurrence risk by 49% compared to Keytruda alone. Numerous other candidates are also in development, suggesting robust regulatory progress and potential financial recovery for Moderna.

Take Advantage of Emerging Investment Opportunities

Ever feel like you missed your chance to invest in top-performing stocks? If so, you may want to pay close attention now.

Our team of analysts occasionally issue a “Double Down” stock recommendation for companies poised for growth. If you fear you’ve missed the boat, this is an opportune moment to invest before it’s too late. Consider these past successes:

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Currently, we are issuing “Double Down” alerts for three outstanding companies, and the window of opportunity may be closing.

Learn more »

*Stock Advisor returns as of February 3, 2025

Prosper Junior Bakiny has positions in Vertex Pharmaceuticals. The Motley Fool has positions in and recommends Merck and Vertex Pharmaceuticals. The Motley Fool recommends Moderna. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Nasdaq, Inc.