Stocks with the ability to generate 10X returns on capital are a rare breed. However, they do exist. In recent times, several biotech stocks have produced gains well in excess of 1,000% for their early shareholders. For example, a $100,000 investment in Axsome Therapeutics back in January 2019 would be worth a whopping $1.2 million today. Under the same scenario, Moderna's stock would have yielded a mind-boggling $2 million payday.

The fact remains, though, that there is only a small handful of stocks that are truly capable of delivering these kinds of life-changing gains. But there is a common theme running through the tiny sliver of biotech stocks that have generated 10X returns on capital in the past.

In a nutshell, these companies always sport a cutting-edge platform that targets a massive, yet underserved, market. Bionano Genomics (NASDAQ:BNGO), BioCryst Pharmaceuticals (NASDAQ:BCRX), and NRx Pharmaceuticals (NASDAQ:NRXP) all appear to have the ingredients necessary to be the next group of millionaire-maker biotech stocks. Here's what investors need to know about these promising growth plays.    

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The genomic revolution is starting to take shape 

Bionano Genomics is a top genome analysis play. The company earns revenue through sales of its optical genome mapping platform known as the Saphyr System, chip consumables for the system, and a separate diagnostic genetic testing services business.

Bionano believes Saphyr's market opportunity just from system sales stands at around $2.1 billion. The company also thinks it can generate annual income from chip consumables and diagnostic services of between $2.3 billion and $3.6 billion, once these markets mature.

So, if everything works out, Bionano's market cap could easily swell to over $10 billion by the end of the decade. The biotech's market cap at present stands at approximately $1.2 billion -- implying that this small-cap genetic testing company could go on a major growth streak in the years ahead. 

A must-own rare disease stock

BioCryst Pharmaceuticals' shares are up by a healthy 67% so far this year, thanks to the outstanding commercial launch of its newly approved oral hereditary angioedema (HAE) drug, Orladeyo. Due to strong demand from HAE patients for an oral therapy, the company recently said that it now expects Orladeyo's 2021 sales to come in between $115 million and $120 million.

That's an exceptional start for a new drug, especially one competing in a crowded market like HAE. BioCryst isn't a one-trick pony, however.

The company has also made significant progress with its experimental paroxysmal nocturnal hemoglobinuria (a rare blood disease) drug, BCX9930, over the course of 2021. BCX9930, in fact, entered a pair of pivotal-stage trials for this high-value indication earlier this year. So, if everything goes smoothly, BioCryst could have another major drug on the market by 2024. Taken together, BCX9930 and Orladeyo ought to be able to top $800 million in annual sales for the rare disease specialist. 

To put this revenue forecast into context, BioCryst's market cap stands at approximately $2.2 billion at present. That's a dirt cheap valuation for a promising rare disease company. Most rare disease specialists, after all, garner premiums in the area of 10X to 30X their peak sales forecast. In other words, BioCryst's stock has the real potential to jump by at least 400% over the next two to three years.   

A small biotech with large-cap potential

NRx Pharmaceuticals is a clinical-stage biotech with three high-value products in development at the moment. Specifically, the company has an anti-inflammatory medicine known as Zyesami in development for severe COVID-19 cases; a live-virus vaccine called BriLife, which is barreling toward a pivotal-stage trial right now; and NRX-101, a late-stage candidate for patients with suicidal bipolar depression.

The main focal point for investors at this stage, though, is undoubtedly Zyesami. This anti-inflammatory therapy has a decent shot at becoming an important new tool in the fight against COVID-19, which would put it in the running to generate hundreds of millions in annual sales.

That may not sound like a lot in absolute terms. But it would represent a sizable windfall for NRx Pharmaceuticals. The pharma company, after all, is presently valued at a paltry $396 million. In short, NRx Pharmaceuticals' stock should soar if Zyesami hits the market in 2022.  

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.