Biotech investing is hard. The science can be difficult to understand, the odds of success are long, and most biotechs are years away from reaching profitability.

That's why we Fools tend to be very picky when it comes to biotech investing. So which stocks do we think are still worth the risk? We asked a team of Motley Fool contributors to weigh in, and they called out GW Pharmaceuticals (NASDAQ:GWPH), Vertex Pharmaceuticals (NASDAQ:VRTX), and Nektar Therapeutics (NASDAQ:NKTR).

Scientists working in lab

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This biotech's addressable market could double

Todd Campbell (GW Pharmaceuticals): GW Pharmaceutical broke new ground last year when it became the first drugmaker to secure FDA-approval for a marijuana-derived drug for epilepsy, a blockbuster indication.

The approval of Epidiolex was for its use in two rare forms of tough-to-treat epilepsy, Dravet syndrome and Lennox-Gastaut syndrome. In Q2, GW Pharmaceuticals is expected to report data from its latest study, which is evaluating Epidiolex in tuberous sclerosis complex, a genetic disease that can cause seizures.

If the data is good, it could significantly increase Epidiolex's market opportunity. There are about 30,000 people with Dravet syndrome, and Lennox-Gastaut syndrome and 25,000 to 40,000 people with tuberous sclerosis complex. Because many of these patients fail to respond to existing antiepileptics, there's a big need for new treatment options. Growing awareness of marijuana's ability to help epilepsy patients and Epidiolex's scientifically proven effectiveness and safety in trials could make this a billion-dollar blockbuster someday.

The upcoming tuberous sclerosis complex data isn't the only reason to consider buying GW Pharmaceuticals, though. The company may also receive Epidiolex approval in Europe soon, providing another catalyst for growth. The possibility of an EU approval and Epidiolex's use in more indications could make buying GW Pharmaceuticals a profit-friendly decision.

A market all to itself

Brian Feroldi (Vertex Pharmaceuticals): As a conservative investor, I tend to favor biotech companies that are growing fast, hold a dominant market position, and are already highly profitable. That's a rare combination, but Vertex Pharmaceuticals checks all of these boxes with ease.

Vertex holds a monopoly-like position in the cystic fibrosis (CF) market. The company has already crossed the finish line with three drugs -- Kalydeco, Orkambi, and Symdeko -- which combined to pull in more than $3 billion in total revenue last year. That number represents 40% growth over the prior year, and operating leverage allowed the company's bottom line to more than double.

Vertex's days of hypergrowth aren't over, either. There's still plenty of room left for growth with its current CF treatments, and Vertex has an exciting triple-drug combination product that should be in regulators' hands by the middle of this year. If all goes well, then the company's addressable patient population could greatly expand.

Wall Street currently expects Vertex's revenue to grow 17% this year and 26% in 2020. Profits are expected to grow by a blistering 54% annualized rate over the next five years. These numbers are high enough to please almost any investor.

Investors don't have to pay an enormous premium to own this stock, either. Shares can currently be purchased for less than 28 times next year's earnings estimates. Add it all up, and there's a lot to like about Vertex's stock right now. 

Imagine an effective pain pill without the addictive tendencies

Chuck Saletta (Nektar Therapeutics): The opioid epidemic has reached epic proportions, with around 2 million addicts and almost 48,000 annual deaths attributed to painkiller abuse. The challenge is that for people in pain, opioids can be effective at providing some relief -- but their addictive nature makes them a significant risk despite the benefits patients can see.

That's where Nektar Therapeutics' new investigational product -- currently dubbed "NKTR-181" -- can play a role. An opioid painkiller with far less addictive potential than traditional opioids, it could provide an excellent treatment for those in pain with lower risks. Encouragingly, at the expected therapeutic dosage level, "drug likability" of NKTR-181 appears similar to placebo, suggesting the promised lower risk of addiction may be a very real thing.

Phase 3 clinical trials have ended, and the FDA has an action date of May 29 to make a decision on NKTR-181. If approved, it can be a real game changer in the world of chronic pain management -- a market with over $20 billion in current annual sales. Nektar Therapeutics' current market capitalization is around $5.4 billion, so approval of NKTR-181 that leads to its becoming a new standard offering could provide a substantial boost to its business. That makes now a great time to consider an investment.

Of course, there are risks involved -- primarily, despite the fact that it looks like it has a lower addictive profile, NKTR-181 is still an opioid. If the FDA elects to not approve it on those grounds, then shareholders will be dependent on the rest of Nektar Therapeutics' pipeline for any potential returns.

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.