When looking for stocks that can make one richer, investors often start with names they know. The problem is that the names they know also tend to be the names that everyone knows, and these stocks tend to be valued in such a way that they wouldn't be considered bargains. Voyager Therapeutics (VYGR 2.69%) and Zymeworks (ZYME 1.85%) are far from household names, but the two clinical-stage biotech companies could fairly be considered bargains, have already enriched some investors, and they are still at the beginning of their growth cycles.

Voyager focuses on gene therapies to treat central nervous system maladies while Zymeworks specializes in next-generation multifunctional biotherapeutics to treat cancer and other diseases. Both companies have actively pursued collaborative agreements to finance their pipelines, putting them in a better financial situation than many clinical-stage biotechs.

Both companies' shares trade right now for under $10, but I don't expect them to stay there for long considering their growth potential. Let's find out a bit more about these two biotech stocks that could make you richer.

1. Voyager's capsids are opening doors

What stands out for Voyager is the company's science, which has enabled it to enter into several collaborative agreements and turn a profit in the first quarter -- even without any marketed products. The company's stock is up more than 57% so far this year.

The company began the year with a $175 million upfront payment from Neurocrine Biosciences in return for the use of Voyager's GBA1 gene therapy program to find treatments for Parkinson's disease and other GBA1-mediated diseases. These include an FXN gene therapy program to treat Friedreich's Ataxia, a rare inherited genetic disease that damages the nervous system and causes coordination issues.

Next, Novartis exercised options to the company's capsids (protein shells of viruses) to treat three neurologic diseases, leading to another $25 million upfront payment for Voyager. In addition, there's another $600 million on the table in milestone payments as well as the potential for royalties for any therapies Novartis brings to market using the capsids.

The advantage to Voyager's capsids is they can cross the brain-blood barrier that often thwarts medications to the brain. The company is using the extra funds to develop its pipeline, including a lead Alzheimer's disease gene therapy candidate that uses an anti-tau antibody to prevent taus, the folding of certain proteins in the brain that are associated with Alzheimer's disease. The company is also looking for a lead candidate for an ALS therapy. 

Thanks to the agreements, Voyager reported collaboration revenue of $150.5 million in the first quarter, compared to $700,000 in the same period last year. The company also reported net income of $124 million in the quarter, compared to a loss of $21.3 million in the first quarter of 2022. The company said it had, as of March 31, $273.3 million in cash, not including the $25 million option exercise payment from Novartis.

While Voyager is still clearly in the early stages of its development, the way other pharmaceutical companies are pairing up with it shows the potential in the company's science.

2. Zymeworks focuses on tough-to-treat cancers

Zymeworks' focus is on difficult-to-treat cancers with the lowest survival rates, such as pancreatic cancer, mesothelioma, and non-small cell lung cancer. The company's shares are relatively flat to start the year (up just 7.5%), but still up 47.5% over the past 12 months. The company just entered three Russell indexes on June 26: the Russell 3000, Russell 2000, and Russell Microcap. That's important because it opens the door for more institutional investing tied to index funds.

Like Voyager, Zymeworks is seeing strong revenue growth, thanks to collaborative agreements with BeiGene and Jazz Pharmaceuticals.

In the first quarter, the company reported revenue of $35.6 million, up 177% year over year. It also trimmed its net income loss to $24.4 million, compared to a $72.6 million loss in the same period last year. The company said that as of March 31, it had $412.4 million in cash, enough to fund operations through 2026.

Zymeworks' lead therapy candidate is Zanidatamab, which is in phase 1, phase 2, and phase 3 trials to treat various cancers that express human epidermal growth factor receptor 2 (HER2), which is a receptor tyrosine kinase that is seen in several mutations that cause cancers. Its next candidate is zanidatamab zovodotin, a HER2-targeted bispecific antibody-drug conjugate. It is in a phase 1 trial for a number of HER2-expressing, HER2-amplified, or HER2-mutant cancers, and the company sees it as a potential monotherapy and combination therapy for several types of cancer. 

The company had a leadership shakeup this past year, with its CEO and CFO both leaving. In January, the company said that Kenneth Galbraith would become CEO and chair, replacing Zymeworks co-founder Ali Tehrani, who had been the company's president and CEO since 2003. Then in May, Neil Klompas, who had been with the company since 2007, stepped down as the company's president and chief operating officer.

A word of caution

Despite these companies' growth in revenue, it is important to acknowledge neither has any approved therapies yet. They certainly are on the way there, but their increase in revenue has come from collaboration agreements that ultimately will rise or fall based on whether the company's therapies can get FDA approval. 

Having said that, both companies, thanks to the collaboration agreements, should have sufficient time (and resources) to develop their promising pipelines.