Top Pharmaceutical Stocks to Watch in May 2017

As a service to our readers, the following list provides the 10 top pharmaceutical stocks to watch this month (May 2017), including the biggest gainers from April...

Pharmaceutical Stock Current Share Price April 2017 Gain
Cleveland BioLabs Inc. (Nasdaq: CBLI) $3.62 +120.6%
Nexvet Biopharma Plc. (Nasdaq: NVET) $6.61 +69.7%
Motif Bio Plc. (Nasdaq ADR: MTFB) $10.10 +68.2%
Axovant Sciences Ltd. (NYSE: AXON) $24.43 +62.3%
Cyclacel Pharmaceuticals Inc. (Nasdaq: CYCC) $5.49 +46.7%
Conatus Pharmaceuticals Inc. (Nasdaq: CNAT) $8.67 +44.9%
Akebia Therapeutics Inc. (Nasdaq: AKBA) $13.07 +43.3%
Akorn Inc. (Nasdaq: AKRX) $33.28 +38.9%
Rockwell Medical Inc. (Nasdaq: RMTI) $8.78 +37.4%
Akari Therapeutics Plc. (Nasdaq ADR: AKTX) $15.02 +35.4%

The best-performing pharma stock of the month - Cleveland BioLabs Inc. - surged 120.6% to $3.53 a share by April 28. That crushed both the Nasdaq Biotech Index's 1.5% gain and the Dow Jones' 1.3% rise over the same period.

Free Report: The Best Stocks to Buy for Mega-Profits in 2017

While those top pharma stocks have posted big short-term gains, the pharmaceutical sector is best played with a long-term view.

It's important to buy shares of a drugmaker before the company releases its next blockbuster drug rather than after. Because once the company releases that game-changing drug, huge profits will start pouring in for both the company and your portfolio. Today, we're going to show you one of these pharmaceutical stocks. But before we do, we wanted to look at another stock investors could have made a 62.2% return on if they had gotten in at the right time and maintained a long-term outlook.

The stock is Gilead Sciences Inc. (Nasdaq: GILD)...

top pharmaceutical stocks to watchIn 2007, Gilead's drug Sovaldi was first synthesized as a treatment for the Hepatitis C virus (HCV), which the Centers for Disease Control and Prevention says kills around 19,000 people every year. The drug was developed by a small biotech named Pharmasset, which Gilead acquired for $11 billion in 2011. Two years later, on Dec. 6, 2013, Sovaldi was approved by the U.S. Food and Drug Administration (FDA).

Since then, Sovaldi has become one of the best-selling drugs in the history of the pharmaceutical industry. Global sales of the drug hit $4 billion in 2016, making up 13% of the company's total sales last year. Combined with Gilead's similar drug, Harvoni, Sovaldi has raked in $20 billion in total revenue.

Investors who bought GILD stock before the Dec. 6, 2013, approval date were handed huge long-term returns. From that date to June 2015, shares rallied 62.2%.

That's why Money Morning Director of Technology & Venture Capital Research Michael A. Robinson consistently looks for the best pharma stocks to buy before the companies release the next big drug. In fact, Robinson just recommended one such pharma company about to release not one but 10 new drugs in China over the next four years.

In other words, this firm's 10 new drugs will tap into the third-largest drug buyer in the world - a country with a population of over 1.3 billion. That could set you up perfectly for long-term returns if you buy this stock today.

Here's one of the best pharmaceutical companies to invest in...

One of the Top Pharmaceutical Stocks to Buy in 2017

Consider investing in Sanofi SA (NYSE ADR: SNY). While it's the largest pharma company in France and fifth-largest in the world, the firm makes some of the most consumed and recognizable drugs on the market. Some include the sleeping medication Ambien and leukemia treatment Lemtrada.

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Michael likes Sanofi because the firm has a massive pipeline of drugs coming to market. Of the 44 total medications in the pipeline, 13 of them are already in phase 3 clinical trials. According to Michael, about half of those drugs in phase 3 have come from partnerships with other companies.

Sanofi's collaboration with other firms is a good way to save cash that can later be used in other areas or projects.

"This is something we're seeing more and more of in pharma these days," Michael told Money Morning readers on April 26. "In my view, it's a smart move to help split up the costs and risks of new drug development."

But the even bigger catalyst for SNY stock will be the firm's stunning expansion into the Chinese market.

China already makes up one-third of Sanofi's revenue and is the firm's third-largest buyer behind the United States and France. According to a March 21 report by The Wall Street Journal, the company projects sales in China will increase by at least 10% in 2017. That would be up from a strong 2 billion euros ($2.15 billion) last year.

With plans to release more than 10 new drugs in China by 2020, Sanofi is perfectly poised for long-term growth just in that market alone.

"Given the relative immaturity of China's biotech and generic drugmakers, it will be years until they stop looking to the West for help managing their pharmaceutical demands," Michael said. "Those years of baked-in growth suit Sanofi just fine."

The SNY stock price is up 17.2% to $47.41 this year. Analysts surveyed by FactSet give it a one-year target as high as $53.25. That means investors who buy in right now could see a return as high as 12.3% in the next 12 months.

However, that high target is still conservative, since most analysts haven't accounted for the rate of drug approvals the firm could see this year. With 13 drugs currently in phase 3 trials, any approval by the FDA or other agency could immediately urge analysts to raise their targets significantly.

In turn, that could lead to much larger returns for patient long-term investors who buy SNY stock today.

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