Earlier this year, clinical-stage biotechs fell in dramatic fashion, as investors turned toward bigger health-care names generating revenue from approved products. In recent weeks, however, a marked reversal in this trend has seen several developmental biopharmas marching higher.

Arrowhead Research (NASDAQ:ARWR) and Isis Pharmaceuticals (NASDAQ:ISIS) were two of the biggest losers in the biotech downturn, even though both companies are working on promising new therapies centered around RNA-based technology. This novel approach to drug development focuses on blocking the expression of defective proteins, which could be tantamount to a functional cure in many diseases. 

Although both companies have compelling pipelines based on this technology, their platforms have important differences that investors need to understand. With that in mind, let's consider which company offers the better opportunity moving forward.  

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A look at Arrowhead
Arrowhead's platform uses RNA interference, or RNAi, technology. Although this technology was once heralded as a potentially revolutionary discovery, problems associated with delivering the therapy to specific tissues have dogged the field since its inception. So much so that Roche sold its RNAi program to Arrowhead in 2011, citing the many hurdles the sector would need to overcome prior to a viable therapy being developed. The main difficulty facing RNAi technologies is that the molecules tend to end up in the liver, often far from the target tissue.

Arrowhead's breakthrough idea was to turn this weakness into a strength by developing a pipeline of RNAi therapeutics aimed at treating liver diseases such as hepatitis B. The company is conducting a midstage trial of its experimental hepatitis B treatment ARC-520 and is performing pre-clinical work for other liver diseases as well.

If everything goes according to plan, we should see top-line data for ARC-520's midstage trial by the third quarter of this year. Given that this trial would go a long ways toward validating Arrowhead's approach to RNAi therapeutics in general, this is a key event to keep tabs on.  

A look at Isis
Isis' pipeline is centered around antisense technology, which has been broadly validated by two FDA approvals for Isis products to date. Indeed, Isis' Kynamro treatment for homozygous familial hypercholesterolemia was the first antisense drug to reach the market. 

Unlike RNAi, antisense drugs may be more effective at treating a wide range of disorders such as cancers, diabetes, and rare genetic conditions. So it's not surprising that Isis has developed one of the deepest and most diverse clinical pipelines in the industry. Specifically, Isis' pipeline sports over 30 drugs in development, including multiple potential blockbusters. Thanks to its robust pipeline, Isis has had little trouble generating significant interest from Big Pharma when it comes to licensing agreements.

It was announced last week that the company's experimental treatment for high triglycerides, called ISIS-APOCIIIRx, significantly lowered the risk of heart disease in two independent studies. Management said it is therefore actively looking at ways to expand the drug's potential indications based on this finding, which could add up to $2 billion to peak sales. In short, there are a lot of good reasons to keep track of this mid-cap biopharma. 

Foolish wrap-up
Arrowhead and Isis are both developing cutting-edge technology that could change the standard of treatment for a host of debilitating diseases. From an investment standpoint, however, Isis looks like the clear winner for a couple reasons.

First, its technology has already been validated by strong clinical trial results and FDA approvals. Second, the sheer diversity of diseases antisense technology could treat might end up dwarfing that of RNAi approaches -- although the leading developer of RNAi-based therapies, Alnylam, is performing a wide range of clinical trials for a host of diseases. Big Pharma has repeatedly partnered with Isis on various compounds, while RNAi was abandoned by one of its former top proponents, Roche. And even many of Alnylam's pre-clinical candidates are Big Pharma cast-offs, showing the general disinterest in this technology from larger players. 

Put simply, Arrowhead's path to building a product line based on its platform is probably more challenging than what Isis faces. Isis' diverse pipeline also gives it multiple shots on goal on the commercial front, which is why I'm much more confident in the stock. 

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George Budwell owns shares of Isis Pharmaceuticals. The Motley Fool recommends Isis Pharmaceuticals. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.