The biotech sector has always held a special appeal for risk-tolerant investors. While these companies face high overhead in the form of towering R&D costs and long lead times for bringing new products to market, the rewards can be just as substantial. Achieving approval for a new pharmaceutical treatment is something of a ‘Holy Grail’ in the industry.
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Yet, approval alone does not guarantee commercial success. The real upside emerges when a company can successfully launch a drug, drive physician and patient adoption, and capture a meaningful share of what can sometimes become a multi-billion-dollar market.
Citi analyst Eric Joseph, a long-time expert on the biotech sector, likes the current risk/reward profile in mid-sized biotech stocks, as he believes this segment offers compelling opportunities to develop first- or best-in-class drugs aimed at high unmet medical needs.
“Against the trailing 12+ month backdrop of generally impressive launch execution, upside recognition of clinical wins, healthy M&A activity within the category, as well as a calmer US regulatory and drug pricing backdrop, we hold a positive outlook on the broader commercial SMid Biotech, which posits an attractive mix of validating clinical readouts, pipeline diversification, and opportunities for margin expansion over foreseeable horizon,” Joseph noted.
Against this backdrop, the Citi expert has named two mid-cap biotech stocks as ‘top picks’ for the rest of the year. According to data from the TipRanks database, both also carry Strong Buy consensus ratings from the rest of the Street; here’s a closer look at them.
Ionis Pharmaceuticals (IONS)
Ionis, the first Citi pick, is a biotechnology company with more than three decades of experience developing RNA-targeted therapies and antisense medicines for serious diseases. Over the years, the company has built a broad portfolio spanning both commercial-stage drugs and late-stage pipeline programs.
The company’s commercial business has started gaining more traction with the launches of TRYNGOLZA and DAWNZERA. TRYNGOLZA, a treatment designed to reduce triglycerides in adults with familial chylomicronemia syndrome, became the first wholly owned medicine that Ionis launched independently in the U.S. market after securing FDA approval in December 2024. DAWNZERA followed in August last year, winning FDA approval as a prophylactic treatment for hereditary angioedema in patients aged 12 and older, while also becoming the first approved RNA-targeted prophylactic therapy for the condition.
Ionis also has several marketed drugs under licensing, marketing, and co-commercialization agreements with larger pharmaceutical companies, including Biogen and AstraZeneca. Those partnerships continue generating royalty revenue from established medicines such as SPINRAZA and WAINUA, providing the company with an additional recurring revenue stream beyond its wholly owned commercial launches.
In addition to its lines of commercialized medications, Ionis also maintains an active research pipeline, with eight drug programs currently in clinical development. One of the more prominent programs is the Phase 3 HORIZON study evaluating pelacarsen as a preventative treatment for major cardiovascular events. The program is being developed in partnership with Novartis.
That expanding commercial footprint, alongside a steady stream of royalty and partnership payments, has started translating into much stronger financial results for Ionis Pharmaceuticals. In 1Q26, the company generated $27 million in revenue from TRYNGOLZA and another $16 million from DAWNZERA, while royalty revenue from partnered drugs totaled roughly $58 million during the quarter. Ionis also benefited from substantial collaboration and R&D revenue, including milestone payments tied to partnerships with larger pharmaceutical companies such as Roche and GSK. Altogether, quarterly revenue reached $246 million, up approximately 86% year-over-year and ahead of expectations by nearly $50 million. The company also posted a 1Q GAAP EPS loss of $0.56, improving from a loss of $0.93 in the prior-year quarter and coming in $0.35 better than analysts expected.
Investors have clearly taken notice, with IONS shares surging 127% over the past 12 months.
For Citi’s Eric Joseph, the key points here are the continued success of Ionis’ research platform, its outlook for its wholly owned commercial drugs, and the potential of the HORIZON program.
“With its ASO platform validated multiple times over, we’re encouraged by Ionis’ pivot toward commercialization and higher value capture of its proprietary pipeline. To this end, we’re bullish on the peak outlook for Tryngloza ahead of sHTG label expansion near-term, bolstered by higher margin rare disease plays by Dawnzera and zilganersen. That said, we expect that a combination of high-profile partnered pipeline readouts will continue to drive IONS discussions near-term, where we think HORIZON offers greater upside potential over CARDIO-TTRansform (ATTR-CM) given relative market size and incumbent positioning,” Joseph commented.
Summing up, Joseph explains why this stock is a top pick: “We view current levels underappreciating Ionis’ relative strength and reach among the platform enabled SMid Biotechs, with the potential to draw broader investor interest as it closes in on FCF generation in 2028.”
Based on this outlook, Joseph sets a Buy rating on IONS, along with a $115 price target that indicates an upside of 52% for the coming year. (To watch Joseph’s track record, click here)
Wall Street appears to share that optimism. Among the 19 most recent analyst reviews, 17 recommend Buy while only two suggest Hold, giving the stock a Strong Buy consensus rating. With shares currently trading at $75.56, the average price target of $105.56 points to another ~40% upside in the year ahead. (See IONS stock forecast)
Cytokinetics (CYTK)
The next Citi pick on the list is Cytokinetics, a biotech focused on developing specialty treatments for cardiovascular diseases. The company uses advances in muscle biology to develop novel therapies targeting cardiac muscle dysfunction, and has built a pipeline featuring first-in-class muscle activators alongside next-in-class muscle inhibitors.
Much of the current excitement surrounding Cytokinetics centers on Myqorzo, the company’s first approved drug. Myqorzo is a treatment for symptomatic obstructive hypertrophic cardiomyopathy (oHCM) in adult patients. The therapy works as a cardiac myosin inhibitor, helping the heart muscle relax more effectively and improving blood flow throughout the body.
Myqorzo is a once-daily oral medication that received approvals in the U.S. and China in December 2025, followed by approval from the European Commission in February 2026. Cytokinetics commercially launched Myqorzo in the U.S. during 1Q26.
The January launch appears to have gotten off to a strong start. Cytokinetics reported solid demand trends for the drug, noting that more than 275 healthcare providers prescribed Myqorzo to about 680 patients during the quarter. The treatment generated $4.8 million in sales revenue during its initial partial quarter on the market.
The commercial rollout also helped drive a sharp jump in quarterly revenue. Cytokinetics generated $19.4 million in total revenue during 1Q26, beating estimates by $10.5 million. The company reported a net loss for the quarter, posting an EPS loss of $1.67 per share that missed expectations by 2 cents. Even so, Cytokinetics ended the quarter with approximately $1.1 billion in cash and other liquid assets.
Beyond the ongoing Myqorzo rollout, investors are also closely watching ACACIA-HCM, Cytokinetics’ pivotal Phase 3 trial evaluating aficamten in patients with symptomatic non-obstructive hypertrophic cardiomyopathy (nHCM). The study enrolled more than 500 patients ahead of schedule and is designed to evaluate whether aficamten can improve symptoms and exercise capacity in this broader HCM population. Cytokinetics expects topline results from ACACIA-HCM in 2Q26.
Encouraged by Myqorzo’s rollout and commercial potential, Citi’s Joseph struck an upbeat tone on Cytokinetics, while also highlighting the broader opportunity tied to the ACACIA-HCM topline results and the company’s longer-term expansion potential.
“We’re bullish on the launch and longer-term commercial outlook for Myqorzo in obstructive HCM given strong its strong reception among cardiologists and solid differentiation profile versus Camzyos. More relevant near- to mid-term however, in the wake of ACACIA-HCM topline results, we believe shares underappreciate its risk-adjusted expansion opportunity in non-obstructive disease. Full results, potentially at the ESC Congress (August 28-31), offer additional upside on solidified commercial forecasts and approval expectations into a 2H sNDA filing. Bigger picture, in view of a differentiated, increasingly derisked CV-focused pipeline, we believe CYTK maintains highly strategically attractive profile among CVME SMid Biotech universe,” Joseph opined.
To this end, Joseph sets a Buy rating on CYTK shares, and he backs that up with a $99 price target that suggests a one-year upside potential of ~29%.
Overall, CYTK gets a Strong Buy consensus rating from Wall Street, based on 19 recent analyst reviews that include 16 Buys and 3 Holds. The stock currently trades at $76.94, while the average price target stands at $98.58 – close to Joseph’s own target – implying 28% upside potential over the next 12 months. (See CYTK stock forecast)
Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
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