Healthcare companies that develop cancer treatments have an exciting opportunity ahead of them. According to the research firm EvaluatePharma, cancer drugs will generate more revenue than any other therapeutic area through 2024. Investors can benefit from this trend by purchasing shares of companies that focus in part -- or exclusively -- on cancer treatments.

With that in mind, here are three cancer treatment stocks you should consider buying right now: Bristol-Myers Squibb (NYSE:BMY), Merck (NYSE:MRK), and Exelixis (NASDAQ:EXEL).

1. Bristol-Myers Squibb

Bristol-Myers has long been a leader in cancer treatment. The company's current lineup includes Opdivo, which was first approved by the Food and Drug Administration in 2014 for advanced melanoma (skin cancer). Since then, Opdivo has earned a plethora of new indications, including as a treatment for lung cancer, lymphoma, head cancer, and neck cancer.

Cancer cells

Image source: Getty Images.

Bristol-Myers' lineup includes Sprycel, a drug that was first approved back in 2006 for the treatment of leukemia. Its other cancer treatments include Yervoy -- which treats melanoma -- and Empliciti, a treatment for multiple myeloma, a blood cancer.

Despite its impressive portfolio of cancer treatments, however, the Bristol-Myers oncology lineup hasn't been performing particularly well of late. During the third quarter, sales of Opdivo -- which is the best-selling one of the bunch -- were $1.8 billion, a measly 1% higher than the prior-year quarter. However, Opdivo is currently being evaluated for several other cancers, and EvaluatePharma projects that Opdivo could be one of the five best-selling drugs in the world by 2024. In other words, the future is still looking bright for Opdivo.

Furthermore, Bristol-Myers acquired Celgene last year in a cash and stock transaction valued at $74 billion, and this deal strengthened Bristol-Myers' lineup as well as its pipeline. The company acquired the rights to multiple myeloma treatment Revlimid, which generated $2.8 billion in sales during the third quarter, 13% higher than the year-ago period.

Bristol-Myers also acquired the rights to such pipeline products as liso-cel and ide-cel, which are being evaluated for several cancers. After its acquisition of Celgene, Bristol-Myers projected that its late-stage pipeline could generate more than $15 billion in revenue. With an already strong lineup of cancer drugs, Bristol-Myers' acquisition of Celgene -- which expanded its portfolio of cancer treatments -- makes the company a buy. 

2. Merck

Merck is best known for its cancer drug Keytruda, and with good reason. This product is approved for a raft of cancers, including melanoma, lung cancer, stomach cancer, and head and neck cancer. Keytruda is still undergoing clinical trials for many other cancers, and the drug continues to earn critical regulatory approvals. In November 2019, Keytruda was approved in Europe for the treatment of head and neck cancer, which, according to some estimates, caused about 68,000 deaths in the region in 2018 alone. Also in November, Keytruda was approved in China for the treatment of non-small cell lung cancer. This approval was particularly exciting since lung cancer is the leading cause of cancer death in China -- there are more than 787,000 new cases of it every year, and approximately 631,000 deaths result from it annually.

More recently, Keytruda was approved by the FDA for the treatment of non-muscle-invasive bladder cancer in patients who have received other forms of treatment. Keytruda will likely continue racking up regulatory approvals and generating strong sales. During the third quarter, sales of Keytruda were $3.1 billion, a whopping 62% higher compared to the prior-year quarter. Keytruda is projected to become the world's best-selling drug by 2024, which means investors can still profit from Merck's cash-cow if they purchase shares of the pharma giant now. 

3. Exelixis 

Last year, shares of Exelixis slid by 10.42%, which compares unfavorably to the performance of the biotech industry -- as measured by the SPDR S&P Biotech Index ETF -- which rose 32.56% during the year. Given this poor performance, why should investors buy shares of this biotech company? Let's consider three reasons.

Exelixis' lead product is a Tyrosine Kinase Inhibitor (TKI, a drug that specifically targets cancer cells) called Cabometyx. This medicine treats advanced renal cell carcinoma (RCC, a form of kidney cancer), and hepatocellular carcinoma (HCC, a type of liver cancer).

During the third quarter, Exelixis' net product revenue was $191.8 million, a 17.7% year-over-year increase.

The company attributed this performance to Cabometyx in a press release:

The increase in net product revenues reflected the continued growth of Cabometyx (cabozantinib) in the U.S. for the treatment of patients with advanced renal cell carcinoma (RCC), as well as the U.S. launch of Cabometyx for the treatment of patients with hepatocellular carcinoma (HCC) who have been previously treated with sorafenib, following its approval by the U.S. Food and Drug Administration (FDA) in January 2019.

What's more, Exelixis' best-selling drug will likely keep on growing its sales. According to P.J. Haley, Exelixis' senior vice president, not only does Cabometyx hold a leading share in the market for TKIs as treatments for RCC, but this market is growing as well, which will allow the company to generate increasingly strong sales. 

Cabometyx is also undergoing clinical trials for other cancers, including bladder cancer and prostate cancer. Lastly, Exelixis is currently attractively valued when taking into account future earnings growth. The company's price-to-earnings growth (PEG) ratio is 0.47.

Exelixis may not be the most recognizable name in the oncology industry, but the company's crown jewel Cabometyx -- and its attractive valuation -- make its stock a buy.