The biotech industry is severely lagging the market this year, at least according to the SPDR S&P Biotech ETF, an industry benchmark that is down about 14% so far in 2023. However, that doesn't mean you should avoid biotech stocks altogether. Even as the sector may struggle near term, some companies still have the tools to perform well in the long run.

Let's look at two biotech stocks worth buying right now: Vertex Pharmaceuticals (VRTX -0.58%) and Moderna (MRNA -0.51%). Although they've moved in opposite directions this year, both are worth serious consideration.

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1. Vertex Pharmaceuticals

Vertex Pharmaceuticals is inching closer to a new drug approval. The company's therapy exa-cel, co-developed with CRISPR Therapeutics, is currently being considered by regulatory authorities in the U.S. and Europe for treating sickle cell disease (SCD) and transfusion-dependent beta-thalassemia (TDT), two blood-related conditions. The first green light could come in December.

Will it send Vertex's stock soaring? Probably not. Vertex is a relatively large biotech with a lineup of medicines that generates solid revenue and earnings. Its performance isn't as dependent on regulatory progress as smaller clinical-stage companies. However, for Vertex, exa-cel's approval would be the first outside its core therapeutic area of cystic fibrosis (CF) in more than a decade.

It could also kick-start a series of several more non-CF launches. Vertex plans to market five brand-new drugs in the next five years. Other than exa-cel, the most promising candidates are VX-548, being developed to treat acute and neuropathic pain; inaxaplin, for treating APOL1-mediated kidney disease; and VX-864, which targets Alpha-1 antitrypsin deficiency. The last two perfectly exemplify Vertex's strategy of developing medicines for illnesses where none currently address the underlying causes.

In the meantime, the company's current CF lineup is still performing well. In the first half of the year, the company's revenue of $4.9 billion was 13.4% higher, year over year. Net earnings per share (EPS) of $6.21 improved from the $6.09 reported in the comparable period of the previous fiscal year.

Vertex's financial results will improve in the medium term as it deepens and diversifies its pipeline. And in the long run, the company's proven innovative abilities should yield more gems. Vertex is working on ambitious programs, including a potential functional cure for type 1 diabetes. All things considered, Vertex Pharmaceuticals is one of the best biotech stocks on the market right now.

2. Moderna

Moderna's financial results haven't been strong this year, at least compared to 2022. Through June 30, the biotech recorded revenue of $2.2 billion and a net loss per share of $3.39. Last year, revenue totaled $10.8 billion and earnings per share were $13.85.

That's quite a drop in just one year, although it was expected. Moderna, a leader in the coronavirus vaccine market, was never going to generate as much in product sales as it did when the COVID-19 pandemic was still declared a state of emergency and governments rushed to order millions of doses of vaccines.

But what's next for Moderna? Thankfully, the company is making solid clinical progress that should still yield regulatory results. Recently, it announced positive data from a phase 1/2 clinical trial for its investigational combined COVID/influenza vaccine, mRNA-1083. The company also started a late-stage study for its potential cancer vaccine, mRNA-4157, in combination with the cancer medicine Keytruda. This combo successfully decreased the risk of recurrence and death in melanoma patients in a phase 2 clinical trial.

Furthermore, Moderna submitted its respiratory syncytial virus (RSV) vaccine to the U.S. Food and Drug Administration for review earlier this year after it aced a phase 3 study. Moderna said it expects up to 15 product launches by 2028. That may sound optimistic, but Moderna at least has the pipeline to back up its ambitions. The company boasts more than three-dozen ongoing programs.

And eventually, its coronavirus vaccine sales should stabilize, at least somewhat, and the biotech will continue to generate revenue from this franchise for a while. Meanwhile, Moderna's shares are down by 45% this year. While the company could remain vulnerable in the short run as it works through its post-COVID plans, patient investors should be handsomely rewarded down the road.