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How to Protect Your Biotech Profits from This Legal Limbo

biotech profits

Gilead Sciences Inc.'s Sovaldi was a real breakthrough in the fight against the chronic liver disease hepatitis C (HCV). The condition may show no symptoms for years after initial infection but can slowly become debilitating.

Hepatitis C affects as many as 200 million people worldwide, and before Sovaldi, the approved drug regimen could treat only about 50% of cases and could cause serious side effects. Treatment was generally long - 24 to 48 weeks - and arduous.

Sovaldi, on the other hand, could cure more than 90% of cases in a matter of weeks at a cost, in the United States, of around $94,000. The pricing caused controversy, but the drug proved transformative for HCV patients, their families, and doctors.

Sovaldi also proved a huge windfall for investors when it received FDA approval in 2013 and entered the pharmaceutical marketplace the following year.

So far, Gilead shareholders have seen a 2:1 split, several dividend payouts, and gains of more than 155% since 2013. Sales of Sovaldi and Gilead's other HCV drug, Harvoni, topped $12.5 billion in 2015 alone.

There's just one big, expensive problem...

Why Biotech Stocks Will Outperform in 2016 – and Our Top Pick

Biotech Stocks

Biotech stocks have stalled in 2016 along with the broader markets, with the iShares Nasdaq Biotech ETF (Nasdaq: IBB) down 24.43% year to date.

Still, Money Morning Biotech Investing Specialist Ernie Tremblay says the sector will outperform in 2016. And he's pinpointed one foundational play that's already climbed 14% in the last five days.

But first, here's why biotech stocks are presenting a huge opportunity right now...

Grab Gilead Sciences Stock Before Its Next 66.5% Climb (Nasdaq: GILD)


Sometimes Washington triggers a stock move that can hand us outsized gains. That's exactly what happened with Gilead Sciences Inc. (Nasdaq: GILD).

In March 2014, U.S. Rep. Henry Waxman (D-CA) lashed out at the cost of Gilead's newly approved Hepatitis C (HCV) drug, Sovaldi. Sovaldi runs $84,000, or $1,000 a pill.

But Waxman missed the obvious. Sovaldi (and its newer version Harvoni) cures 90% of HCV patients. That means patients can avoid the need for a liver transplant - an operation that runs $250,000 if an organ donor is found. And that price doesn't include antirejection drugs and antibiotics people must take for the rest of their lives.

Still, Gilead sold off on fears that its high cost would make Medicare look to another HCV drug maker with a less expensive solution. GILD stock lost 13% of its value in a matter of days.

Wall Street was dead wrong...

Medicare actually spent $4.6 billion on Hepatitis C treatments in the first six months of this year. That's almost as much as the agency spent in all of 2014. Gilead accounted for 66% of all covered prescriptions.

And since April 2014, Gilead has gained 66.5% - more than four times that of the S&P 500.

Simply put, Gilead dominates the HCV sector. And as I'll show you today, opportunities for the firm are growing faster...

How Biotech ETFs Have Performed During the Valeant Stock Crash (NYSE: VRX)

Biotech ETFS

Biotech ETFs have been the focus of many investors this week after Valeant Pharmaceuticals Intl. Inc. (NYSE: VRX) shares dropped more than 46% last week.

One biotech ETF with Valeant as a holding slumped 8.4% in the past three months, as VRX stock continues to fall.

Since August, shares of the drug giant - dubbed by short seller Citron Research as "pharma's Enron" - have plunged 56%. Year to date, VRX stock is down 22.4%...

10 Numbers That Stunned Investors This Week

this week

Here are this week's need-to-know facts about the stock market, economy, Wall Street, and life-changing global events...

It's the numbers that count in this crazy world. They can tell stories that words sometimes can't.

Here's a look at some of the fascinating, infuriating, amusing, depressing, and altogether important numbers that the world has put up on the board recently - and why you need to know them...

Biotech Stocks Have Now Reached Bear Market Territory

biotech stocks

The S&P 500 has dropped 3.8% since the end of July, but that's nothing compared to the losses we've seen from biotech stocks.

In fact, this week's latest pullback has many biotech stocks in bear market territory.

Here's just how far they've fallen...

Top Biotech Penny Stocks of 2015 with Gains as High as 79%

penny stocks to watch

The markets have underperformed so far this year, and that's why we've been targeting stocks with higher profit potentials.

Today, we bring you the top biotech penny stocks of 2015. Each stock has outperformed the market. And one pick has already posted a gain of more than 79%.

Pharmaceutical Companies Hike Prescription Prices 76% Since 2010

pharma companies

Pharmaceutical companies have been raising the price of prescription drugs at an alarming rate since 2010.

According to a new report from The Wall Street Journal, the 30 highest-selling drugs in the United States saw their prices increase roughly 76% from 2010 through 2014.

And as they've raised prices, their profits have soared...

How Social Media Affects the Market

Stock Market Today

Democratic presidential front-runner Hillary Clinton demonstrated exactly how social media affects the market last week when her vitriolic tweet sent the biotech sector into an 8% tailspin.

These days, a post or a picture on social media platforms like Facebook, Instagram, or Twitter can have a massive impact on U.S. markets.

We've got four more memorable examples of times when social media buzz has blown up a stock - or entire markets - for better or for worse...

Biotech ETFs Are Now Discounted for 2016 After Sell-Off

Dow Jone

Biotech stocks have gotten crushed in recent weeks, with the Nasdaq Biotechnology Index falling 15.5% in the last month and 25% from its July highs.

And while many investors are taking their money to the sideline, this is actually a great time to invest in biotech ETFs with 2016 in mind.

Here's the biotech ETF we're recommending now...

As Another Sector's Sails Lose Wind, Watch This One Barometer


One by one, the bubbles are bursting...

First it was the commodities bubble that blew up in mid-2014, which caused the collapse of energy and commodity stocks -they are now down between 40-80%.

It also caused the end of the corporate credit bubble in high yield bonds and bank loans over the second half of 2014 and into this year.

Then the Chinese stock market, which had gone parabolic early this year, collapsed, sending global markets into a tailspin this summer.

What Hillary's Pharma Plan Means for Biotech Investors

pharma (2)

Martin Shkreli, CEO of Turing Pharmaceuticals, made news this week when he announced he would raise the price of a medication his company had acquired, Darapim (pyrimethamine), from $13.50 to $750 per pill.

Here's what biotech investors need to know...

Biotech Investing Buff Just Made $1.1 Billion Profit in 8 Months – Here's How

Biotech Investing

With a net worth of $12.6 billion, Patrick Soon-Shiong, MD, is the world's richest doctor, the richest American in the healthcare industry, and the 96th-richest person on the planet in 2015 according to Forbes.

And just in August, the 63-year-old became $1.1 billion richer -- from a move he'd made only eight months prior, according to Bloomberg...

Here's Soon-Shiong's story - plus five ways you can cash in with biotech profits of your own...

A Biotech Stock to Buy with "Nearly Limitless" Profit Potential


Today, we're recommending a biotech stock to buy that Money Morning Biotech Investing Specialist Ernie Tremblay says has a "nearly limitless" profit potential.

It's a medical device company with a revolutionary product that helps restore vision to people suffering from blindness.

Here's the revolutionary technology behind this biotech stock to buy...

Two Tactics for Bigger Biotech Investing Profits


Over the past six months, we've seen the Nasdaq Biotechnology Index, an indicator for the entire sector, take some wild swings up and down, often by as much as 10% from week to week.

That's in stark contrast to the previous half-year, when we experienced a relatively steady upward swell.

This year's unsettling international headlines haven't helped. In just the last few months, we've battled doom-and-gloom sentiment on the debt crisis in Greece, currency manipulation in China, cratering oil prices, the burgeoning debt crisis in Puerto Rico, and the specter of a September rate hike from the Fed.

There is good news: This turbulence isn't insurmountable. And the simple tactics I'm about to share with you could dramatically improve your profits in this choppy market...