3 Beaten-Down Biotech Stocks to Buy for a Turnaround in 2025

Industry Overview - The biotech sector experienced a volatile performance in 2024, starting positively but facing declines in the second half due to disappointing third-quarter results, guidance cuts, pipeline setbacks, and the appointment of Robert F. Kennedy Jr. as head of Health and Human Services [1] Company Summaries Immunocore Holdings (IMCR) - IMCR is focused on developing TCR bispecific immunotherapies, with Kimmtrak being the first FDA-approved immunotherapy for metastatic uveal melanoma, generating $226 million in sales in the first nine months of 2024, a 32% year-over-year increase [3] - Despite strong sales growth, IMCR's stock has dropped 58% year to date due to perceived risks in pipeline development, particularly concerning brenetafusp's efficacy beyond cutaneous melanoma [12] - Analysts expect a significant upside for IMCR in early 2025 with anticipated positive updates on an investigational HIV therapy and ongoing late-stage studies for Kimmtrak [13] Allogene Therapeutics (ALLO) - ALLO is developing allogeneic CAR T therapies for cancer treatment, with a strategic pivot that has delayed the initial market introduction of its lead drug cema-cel to 2027 [6] - The stock has declined 35% year to date, but loss per share estimates for 2025 have improved from $1.45 to $1.34 [7][15] - ALLO is also exploring CAR-T therapies for multiple myeloma and renal cell carcinoma, with plans to initiate a study for lupus by early 2025 [16] Day One Biopharmaceuticals (DAWN) - DAWN focuses on therapies for pediatric cancer, with its drug Ojemda being the only systemic therapy for pLGG in the U.S., generating over $28 million in revenue in the first nine months of 2024 [8][17] - The company is conducting a pivotal late-stage study for Ojemda and has two other investigational candidates in its pipeline [9] - DAWN's stock has decreased over 13% year to date, but loss per share estimates for 2025 have improved from $2.03 to $0.99 [10]