Assessing the value of biotech stocks can be difficult. There are lots of variables, including pipeline prospects and market dynamics. But some biotech stocks trade at prices that seem to be at nosebleed levels. In this Motley Fool Live video recorded on Sept. 22, 2021, Motley Fool contributors Keith Speights and Brian Orelli discuss three biotech stocks that appear to be the most overvalued right now.

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Keith Speights: Now, let's switch to a non-newsy topic here. We talk quite often about biotech stocks that we like. Let's go the other direction though, Brian. If you had to pick the three most overvalued biotech stocks on the market right now, which ones would you choose?

Brian Orelli: Value is in the eye of the beholder, and obviously, there are people buying at the current valuation. Obviously, there are people with whatever the three stocks, I'm going to mentioned, there are people who think that the value is perfectly acceptable right now because they are buying it that level.

But the three I would go with was Moderna (MRNA 1.11%), the market caps around $175 billion. It trades at about 8.6 times 2021 potential sales of $20 billion. That's not bad if it was growing. But we'll just have to wait and see how long we'll need the boosters, and then how much competition the company gets. I don't know, I just feel like $175 billion for $20 billion in sales is a little outrageous. That's mostly a valuation play.

Beam Therapeutics (BEAM 1.08%) is another company I have a bit of a valuation issue with. I like the company. I like the technology. It's using CRISPR to make single-based changes in its genome. But it's valued around $6.6 billion. But it hasn't even started clinical trial yet.

So $6.6 billion for promising but unproven technology seems like it's a little high. I'm not going to say it won't go up from here, but it's certainly worth much more if it can prove the technology works. But I'm not sure that the upside really justifies the unknown risks.

If you look at something like CRISPR Therapeutics, its market cap is $8.9 billion, and Intellia is $11.3 billion, and they at least have clinical trial data that have shown that there is proof of concept data to show that their drugs work, where Beam Therapeutics is at $6.6 billion, but hasn't actually proven in the clinic that they can show that their drug works.

Then the third one I would say is CureVac (CVAC -0.61%). Ticker there is CVAC. Its market cap is $11.3 billion. Has an mRNA COVID-19 vaccine. But it doesn't seem like it's actually working. The efficacy was only about 48 percent in the 90 percent range for Moderna and Pfizer's mRNA vaccines. The company highlighted the increase in variants when the Phase III clinical trial was ran. They ran their clinical trial much later than Moderna and Pfizer, and they think that might be the reason for the lower efficacy.

But I think the bigger issue might just be the dose wasn't high enough. They tested a higher dose in Phase I, but the side effects were too strong until they decided to go with a lower dose. Their lower dose doesn't really create the same level of antibodies as Moderna's, and Pfizer, and BioNTech's.

I think that's probably the bigger issue and the reason why the vaccine doesn't work. Then if that vaccine doesn't work at the lower dose and the higher dose has too higher of the side effects, then that could mean that they use a different mRNA technology compared to Moderna and BioNTech's. I'm a little worried that their whole technology doesn't work, and if that's the reason, then it's hard to justify the $11.3 billion on their pipeline if their pipeline is going to work because their technology doesn't work.

Editor's note: The original transcript stated CureVac's efficacy was about 47%. The actual efficacy was 48%.