Source: U.S. Food and Drug Administration.

It's no secret that the biotech sector is home to some of the fastest-growing companies in the world, as well as cutting-edge innovation. But along with that innovation comes a pretty high risk of failure. Out of every 5,000 drugs to make it to preclinical studies, the odds are that just one will receive approval from the Food and Drug Administration. 

Investing in the biotech sector involves a willingness to dig deep into the research and technology behind the drug development process, and it sometimes requires nerves of steel.

With that in mind, we asked three of our top healthcare contributors which biotech stock they believe investors with high risk tolerance should consider for their portfolio. Here's what they had to say. 

Todd Campbell 
If no industry is riskier than biotechnology, no stocks are riskier to buy than clinical-stage biotechnology companies, which can move wildly on market whims and whispers.

If taking that kind of ride is how you roll, then there are some intriguing companies that might be worth taking a chance on. One is Portola Pharmaceuticals (NASDAQ:PTLA).

Source: Portola Pharmaceuticals.

Portola Pharmaceuticals is developing a drug that reverses the anticoagulant effects of some of the planet's fastest growing medicines: factor Xa inhibitors.

Those drugs, marketed by giants Johnson & Johnson, Bristol-Myers Squibb, and Pfizer, are breaking warfarin's decades-long stranglehold on a $10 billion market, and one of the only things holding back more widespread adoption is that this new generation of drugs lacks an antidote.

In phase 3 trials, Portola's andexanet alfa has already proven that it stops factor Xa drugs in their tracks, and that suggests that Portola will file for FDA approval soon. If andexanet alfa gets the regulatory green light, it could become a staple at every hospital and urgent care facility in the nation.

Andexanet alfa alone could justify investing in Portola, but Portola is also developing betrixaban, its own factor Xa inhibitor.  If ongoing phase 3 trials for betrixaban pan out, then betrixaban's longer half life and potential for fewer drug interactions could allow it to carve out a big chunk of market share down the road, and that could offer even more upside. 

Cheryl Swanson 
Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) was one of the top-performing biotechs over the last year, up almost 70%. And with its PCSK9 drug Praluent's recent FDA approval, and yet another likely blockbuster speeding toward the FDA, this stock should not only hold its own, but reward investors willing to accept its high-risk profile.

Source: Regeneron Pharmaceuticals.

Next up for approval is Regeneron's drug dupilumab, which has the coveted breakthrough designation and could end up the go-to treatment for a wide range of allergic ailments. The drug is in pivotal efficacy trials for both eczema and asthma. Assuming nothing goes awry in the clinic and it gets the FDA nod, peak sales could range from $2.5-2.8 billion a year.

On the flip side, Regeneron's P/E metrics are sky high. But the science out of Regeneron has been stellar for quite a long time now, and the company seems poised to move from a one-drug wonder (eye treatment Eylea) to a triple play. As Praluent ramps up, and dupilumab races toward approval, this stock should have multiple catalysts to keep it moving upward.   

Sean Williams 
I believe investors who can stomach a lot of volatility and risk would be wise to keep clinical-stage biotech company Threshold Pharmaceuticals(NASDAQ: THLD) high on their watchlists.

Threshold's lead drug, evofosfamide (previously known as TH-302), is being studied in 10 different trials across more than a dozen different oncology indications ranging from blood cancer to solid tumors.

What makes evofosfamide so intriguing is its mechanism of action. Unlike traditional cancer drugs that typically focus on the protein signature of cancer cells, evofosfamide is a tumor hypoxia-seeking compound. Often times, tumors outpace blood vessel growth, leaving certain portions of a tumor starved for oxygen, or hypoxic; meanwhile, hypoxia is a rare phenomenon in healthy cells. With evofosfamide targeting these regions of hypoxia, Threshold should be able to concentrate its effect on the tumor with minimal healthy cell loss.

Source: Threshold Pharmaceuticals.

The key study for evofosfamide is its phase 3 MAESTRO study for advanced pancreatic cancer, and secondarily its phase 3 study for soft tissue sarcoma. Both should yield top-line results in 2016. If evofosfamide somehow runs the table on a majority of its studies, the most bullish analysts project peak annual sales of as much as $3 billion.

Now here's the risky part: evofosfamide comprises nearly all of Threshold's current valuation. TH-4000 for non-small cell lung cancer and head and neck squamous cell carcinoma has demonstrated early promise, but likely makes up a considerably smaller component of Threshold's current $310 million valuation. This means if evofosfamide fails in one or both of its phase 3 studies, it could cast serious doubt on the company's remaining studies. Different cancers can react differently to the same medication, but Threshold's future would be very much up in the air if either study missed the mark.

In my opinion this has all-or-nothing appeal. If evofosfamide misses its mark in MAESTRO, its stock could witness substantial pain. On the other hand, success in MAESTRO (and the magnitude of success relative to the placebo) considering the relatively slow advances in treating pancreatic cancer could double or even triple Threshold's valuation.

It's a risky bet without a doubt, but it's a biotech stock investors should be closely monitoring.

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.