Vertex Pharmaceuticals and Amgen: Two Healthcare Stocks to Watch
Vertex Pharmaceuticals and Amgen are two healthcare stocks that have outperformed the broader market this year. However, it might not be too late to invest in these companies, given their strong pipelines and attractive medium-term prospects. Vertex generates consistent revenue and earnings from its medicines for cystic fibrosis (CF), with no cure available for the disease. This grants the company strong pricing power and a somewhat predictable revenue stream.
In the second quarter, Vertex's top line increased by 12% year over year to $3.33 billion, while its earnings per share climbed 8% year over year to $4.31. The company has been diversifying its lineup with products such as Casgevy and Journavx, which are gene-editing therapies for blood-related diseases and acute pain, respectively.
Vertex's pipeline candidates, including inaxaplin and povetacicept, also show promise. Inaxaplin helped reduce proteinuria in patients with APOL1-mediated kidney disease (AMKD) in a recent Phase 2b study. Meanwhile, Amgen has been navigating the patent cliff for its denosumab medicine, which was once an important growth driver but is now facing biosimilar competition.
Despite this challenge, Amgen's revenue increased by 10% year over year to $10.1 billion in the second quarter. The company's diversified lineup and pipeline candidates, including dazodalibep and MariTide, suggest a bright future for Amgen.