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October 13th, 2022 | 14:10 CEST

Attention, turnaround: Bayer, BioNTech, Defence Therapeutics, MorphoSys - These biotech stocks are way down!

  • Biotechnology
  • Cancer
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Even though more people are being diagnosed with cancer today, and the disease remains the leading cause of death, the number of people dying from cancer is trending downward. In recent years, respectively, survival rates have been steadily increasing. The relative proportion of survivors based on all cancer types in the US has increased from 50% to more than 67% over the past two decades, so today, two out of three patients with a serious disease are still alive after five years. In Europe, too, there has been an increase in 5-year survival rates for the most common cancer types. This is encouraging and draws attention to the oncology sector. Which biotech stocks are significant here and offer a good entry point?

time to read: 5 minutes | Author: André Will-Laudien

Table of contents:

    David Elsley, CEO, Cardiol Therapeutics Inc.
    "[...] As a company dedicated to developing treatments for rare heart diseases, we see this as an opportune moment to contribute to the fight against heart disease and make meaningful strides in improving heart health worldwide. [...]" David Elsley, CEO, Cardiol Therapeutics Inc.

    Full interview


    Bayer - A giant in oncology too

    Bayer has already been accepted as a supporter in the National Decade against Cancer in 2020. The aim of the initiative, which was launched by the German Federal Ministry of Education and Research (BMBF) together with the German Federal Ministry of Health (BMG) and other partners, is to prevent cancer wherever possible, improve the chances of cure through new therapies and increase the length and quality of life of those affected.

    Bayer is particularly committed to developing precision oncology and, as a supporter, would like to establish an active dialogue with relevant players from research, politics, industry and patient representatives and promote it on a sustainable basis. Cancer is still the second most common cause of death in Germany. Currently, approximately 500,000 people are diagnosed with cancer every year. Studies indicate that this figure will rise to around 600,000 by 2030 due to the expected ageing of society. The development of increasingly precise and personalized therapies is one of the latest advances in cancer treatment, which includes precision oncology. Bayer is committed to strengthening the importance of molecular testing in oncology so that tumor diseases in Germany can be diagnosed at an early stage and receive the most precise tumor therapy possible. The program is comprehensive and a mainstay of German oncology research. The business unit is very important for Bayer because it generates international attention.

    Although Bayer shares recovered from the glyphosate lawsuits in the US in the spring of this year, they recently fell back by a good 20% to below EUR 50. Nevertheless, the pharmaceutical giant is still in positive territory this year. Analysts are also optimistic again. The experts surveyed by S&P Global Intelligence see a median price target of EUR 78.8, representing a premium of just under 60% over 12 months. With a 2023 P/E ratio of 5.9 and a dividend yield of 5%, Bayer shares are rarely found at such a favorable price.

    Defence Therapeutics - Off to a good start with the treatment of lung cancer

    Since the original launch of the Cancer Moonshot in 2016, the US cancer community has made measurable progress toward three ambitious goals: accelerating the scientific discovery of cancer, fostering greater collaboration, and improving the sharing of cancer data. In early 2022, President Biden announced a relaunch of the Cancer Moonshot and listed additional goals: To cut the cancer death rate in half within 25 years and significantly improve the lives of people with cancer. The initiative is currently being revived in the US.

    The Canadian biotech specialist Defence Therapeutics (DTC) has developed its proprietary ACCUM™ platform, a patented technology that offers great hope in current cancer research. With Biden's "Cancer Moonshot" initiative, more research funding from governments can also be expected in the interest of patients. The Company is attracting attention again, as it has just launched a program to treat lung cancer. The new AccuTOX™ formulation, an ACCUM™ variant for intratumoral administration, is being used. The use of this compound in combination with various immune checkpoints leads to a significant cure rate. At the molecular level, AccuTOX™ inhibits several key cellular signaling pathways utilized by tumors, such as DNA replication, cell division, cell integrity and various modifications affecting the genome. This translates into limited cell repair, accumulation of misfolded proteins, and generation of free radicals that cause irreversible DNA damage. AccuTOX™ ensures the breakdown of the general cellular balance, consequently leading to the effective death of the diseased cells.

    The scope targets all lung cancers, the three most prominent being small cell bronchial carcinoma, lung carcinoid and non-small cell bronchial carcinoma. The global lung cancer therapeutics market was valued at USD 24.7 billion in 2021 and is expected to more than double to USD 54.5 billion by 2029, growing at a compound annual growth rate (CAGR) of 10.4% during the forecast period, according to research by Databridge Market Research. This represents an outstanding environment for innovative Defence Therapeutics. DTC shares have already been rising since early October.

    BioNTech and MorphoSys - What is the current status?

    At the 2022 Ludwig Erhard Summit, the two BioNTech CEOs were recognized for research on their Corona vaccine. Özlem Türeci and her husband Ugur Sahin also spoke about a novel cancer therapy that could be available in a few years. With Phase II trials already completed, the founders now appear to be on the verge of a breakthrough. The products are being tested on a larger number of patients, and the results so far are encouraging. The goal is to develop novel immunotherapies against cancer without severe side effects. Chemotherapy, for example, is considered quite effective but very aggressive. The mRNA method, which was already used for the Corona vaccine, again plays an important role in the approach. Recently, Mainz-based biotech company BioNTech reported a tentative success for an mRNA therapy against one of the deadliest tumor types, pancreatic cancer.

    At MorphoSys, it is all about the two cancer drugs, Monjuvi and Pelabrisib. In addition to the antibody Monjuvi, which is already a major revenue generator for MorphoSys, the drug Pelabresib, which MorphoSys secured with the USD 1.7 billion acquisition of US cancer specialist Constellation Pharma, is then expected to follow. "This is our next big catalyst," says CEO Kress optimistically. Just over two years ago, MorphoSys received approval for its first proprietary drug, Monjuvi, in the US and, most recently, for the EU. The drug is used to treat a malignant disease of the lymphatic system.

    Both shares are currently showing interesting chart formations. While the fall from the highs is between 75% and 90%, BioNTech has recovered 25% from the bottom due to a now low valuation (P/E 8.5). Even on weak NASDAQ days, the Mainz-based company has recently shown strength. Hedge funds are at work in the MorphoSys share, which repeatedly bring the value below the EUR 20 mark. A liberation strike should go at least to EUR 23.50 - here lies an important breakout line to the upside. Both shares are good for a strong turnaround when the environment improves.

    The stock market is currently showing its most volatile side. Growth stocks, in particular, are suffering from high interest rates and falling valuation parameters. This may continue for a while. Bayer and BioNTech are considered standard stocks, but MorphoSys and Defence Therapeutics are also good additions to a risk-conscious portfolio because of their interesting pipelines. The latter, with its promising ACCUM™ technology, is valued at only a low EUR 42 million.

    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") currently hold or hold shares or other financial instruments of the aforementioned companies and speculate on their price developments. In this respect, they intend to sell or acquire shares or other financial instruments of the companies (hereinafter each referred to as a "Transaction"). Transactions may thereby influence the respective price of the shares or other financial instruments of the Company.
    In this respect, there is a concrete conflict of interest in the reporting on the companies.

    In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.
    For this reason, there is also a concrete conflict of interest.
    The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.

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    Der Autor

    André Will-Laudien

    Born in Munich, he first studied economics and graduated in business administration at the Ludwig-Maximilians-University in 1995. As he was involved with the stock market at a very early stage, he now has more than 30 years of experience in the capital markets.

    About the author

    Related comments:

    Commented by Fabian Lorenz on May 16th, 2024 | 08:00 CEST

    Share price shock at Siemens Energy! What are BioNTech and Cardiol Therapeutics doing?

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    The Siemens Energy share has been one of the surprises of recent months. It has more than doubled since the beginning of the year. Is a crash now imminent? Yes, if you believe Bernstein. Their analysts are shocking us with a horror price target. The Cardiol Therapeutics share performed even better than Siemens Energy in 2024. Despite the 150% rally, analysts see upside potential for the cardiovascular disease specialist. Things will get really exciting at the beginning of June when new study results are due. BioNTech, on the other hand, is currently failing to convince analysts. Reactions to the latest quarterly figures were modest.


    Commented by Stefan Feulner on May 14th, 2024 | 07:30 CEST

    Bayer, Defence Therapeutics, Novavax - Major events

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    The biotechnology sector is still on the move and is currently characterized by a high degree of volatility. For instance, BioNTech, a former star during the pandemic, reported a net loss of EUR 315 million in the first quarter. The Mainz-based biotech now wants to focus more on the development of its cancer drugs due to the slump in demand for COVID-19 vaccines. However, for years, innovative, undiscovered companies have existed in this billion-dollar market that could, with their technologies, become the new high-flyers in the biotech industry.


    Commented by André Will-Laudien on May 9th, 2024 | 07:00 CEST

    Biotech and pharma stocks finally follow suit! Novo Nordisk, Bayer, BioNTech, Vidac Pharma and Evotec on the buy list

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    Things looked very different at the beginning of the year. After a brilliant rally in the Nasdaq Biotech Index at the end of last year, investors thought the upswing could continue in 2024. So far, this hope has not been confirmed. The main focus for the industry is the refinancing conditions. These have gradually deteriorated, as stubborn inflation is keeping central bank interest rates high. And judging by the wording of central bankers, the next interest rate cut does not seem to be penciled in yet. However, if it happens in the summer, things will likely move quickly for the life sciences sector. Then a quick sector rotation is the order of the day! Here is our buy list for the upcoming event.