Regeneron (NASDAQ:REGN), Amgen (NASDAQ:AMGN), and Celgene (NASDAQ:CELG) are three of the world's biggest biotech companies, and each has compelling new drugs on deck that could reshape indications and become top sellers. Let's take a closer look at each.

Hoping for a better reception

Since launching its cholesterol-lowering drug Praluent in 2015, Regeneron Pharmaceuticals has seen its shares struggle. Praluent, which was co-developed by Sanofi SA (NASDAQ:SNY), was rolled out to blockbuster expectations, but sales have been anemic so far, largely because its $14,000 price tag has been hard for insurers to stomach, given how little they pay for statins, the most widely used drugs to treat high cholesterol. 

Gold and silver pills spill out of a larger gold and silver pill, and onto a pile of money.


After Praluent's disappointing launch, it's not surprising that investors are leery about Regeneron's future, but the company does have another new drug hitting the market, and that could get this stock back to its winning ways. 

Last month, Regeneron and Sanofi secured FDA approval of their new eczema drug, Dupixent, the first biologic drug specifically approved to treat moderate to severe eczema. Regeneron estimates Dupixent's addressable patient population at 300,000 Americans.

If Dupixent's efficacy in the real world matches up with its trials, then it could quickly win over doctors and patients. In trials, over 35% of Dupixent patients achieved clear or nearly clear skin, and they also benefited from more than a 50% reduction in severe itching. 

Because therapies used to treat autoimmune disorders like this command much higher prices than statins do, insurers (so far) aren't balking at Dupixent's $37,000 annual cost, Assuming this remains to be the case, and doctors warm up quickly to Dupixent, its sales could become a meaningful new source of revenue growth that kick-starts shares higher. 

Betting big on biosimilars

Amgen is one of the biggest biotech companies on the planet, and while patent expiration on Neupogen, its anemia drug, and Enbrel, its autoimmune-disease drug, creates headwinds to sales, investments in biosimilars could propel this company's stock higher.

Amgen decided to embrace biosimilars early on, and as a result, it boasts one of the most advanced biosimilar pipelines out there. In trials, its biosimilars are delivering similar efficacy and safety to their brand-name counterparts, despite being inexact copies of them. 

Three of Amgen's biosimilars are particularly intriguing. Amjevita, which will be sold as Amgevita in Europe, is a biosimilar to the $14 billion-per-year biologic Humira. ABP-215 is a biosimilar to the cancer drug Avastin, and ABP-980 is a biosimilar to the breast cancer drug Herceptin. 

Last fall, the FDA approved Amjevita, but Amgen won't launch it in the U.S. until it's beaten back legal challenges from Humira's manufacturer, AbbVie Inc. In Europe, a launch could come sooner because that market has a longer history of embracing biosimilars. However, a timeline for a rollout hasn't been announced yet.

Its Avastin and Herceptin biosimilars are also getting close to commercialization. In September, the FDA is scheduled to decide on the Avastin biosimilar, and a filing for European approval was submitted in December. A filing for U.S. approval of its Herceptin biosimilar is expected soon, too.

Undeniably, it's in the early innings for biosimilars, but I think the odds are good that these drugs will win a lot of prescription volume over time. If I'm right, then they could have a big positive impact on sales, and shareholders' profits.

Expanding into a new market

Perhaps nobody sports as enviable of a track record at commercializing new drugs as Celgene, and next year, ozanimod could give it yet another feather in its cap.

Ozanimod is an oral drug for treating multiple sclerosis, and if regulators eventually approve it, it will compete in a market that tops $19 billion per year. Currently, oral MS drugs represent more than $8 billion in annual MS drug sales, and if things go Celgene's way, ozanimod could be perfectly positioned to chip significantly away at that figure.

Ozanimod is an oral S1P-inhibiting drug that's more selective than the only other oral S1P drug on the market, Gilenya. The latter is the second best-selling oral MS drug, with over $3 billion in annual sales, and based on its trial results, ozanimod seems to deliver a more attractive safety profile than Gilenya does. Because ozanimod use doesn't cause a sudden drop-off in heart rate -- something that's associated with Gilenya  -- it could displace Gilenya's use in newly diagnosed patients. Also, there haven't been any reported cases of the rare brain disease PML in ozanimod patients, and that may give it an edge over both Gilenya and the $4 billion-per-year oral MS drug, Tecfidera. In the past, PML has been observed in both Gilenya and Tecfidera patients. 

Recently, Celgene has said it plans to file for ozanimod's approval soon, and if so, then an FDA decision could come next spring. Assuming it wins over regulators, I think it has a very good chance of becoming a blockbuster seller for Celgene, and that potential catalyst makes this stock incredibly interesting. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.