3 Biotech Stocks You Might Not Know About, but Ought to Consider Buying

By Markets Fool.com

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There are countless investment opportunities in biotechnology, and while some biotech stocks may become superstars, most of them will struggle. To help cut through the noise and separate potential winners from losers, I dug into the data and discovered three intriguing biotech stocks investors looking for exposure to the industry might want to consider buying. Read on to learn why I think these lesser-known companies are so interesting.

No. 1: Relypsa
The most intriguing thing about Relypsa is that it could have its first drug on the market by the end of this year. The company is developing patiromer for oral suspension, or patiromer FOS, a drug that could help treat millions of patients suffering from chronic kidney disease who end up with dangerously high levels of potassium in their bodies.

Because kidneys are responsible for clearing excess potassium, and kidney disease medications can cause potassium levels to jump higher, patients with chronic kidney disease struggle to maintain ideal potassium levels.

For that reason, if the FDA approves patiromer FOS in October, then Relypsa could end up with a widely-used therapy, and since patiromer FOS hasn't been licensed to any other company, Relypsa benefits wholly from its success.

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Admittedly, there are a lot of caveats to this one, including that there's no guarantee the FDA will approve patiromer FOS -- or that doctors will prescribe it. However, with an underserved market, the potential for patiromer FOS may outweigh the risk, making Relypsa worth owning.

No. 2: Esperion Therapeutics
Statins are the most widely-used drugs in America because high cholesterol levels are putting more Americans at risk of developing heart disease today than at any other point in our history.

However, statins don't reduce cholesterol levels for everyone, and that has companies like Esperion Therapeutics developing new cholesterol-busting solutions.

Esperion's lead product is ETC-1002, an oral drug putting up solid results in clinical trials. Recently reported results from a phase 2 trial showed that adding ETC-1002 to statin therapy further reduced bad cholesterol levels by 24% versus statins alone.

Those results could indicate that ETC-1002 has the potential of someday becoming part of a standard-of-care. Since Esperion's founder is Roger Newton, the co-inventor of Lipitor -- a statin that was once the best-selling drug on the planet -- investors may want to give this one a closer look.

No. 3: Amicus Therapeutics
Amicus Therapeutics is working on a medication that could be used to treat Fabry disease and Pompe disease, two uncommon conditions that are currently treated with some of the globe's priciest therapies.

Amicus' most advanced drug is migalastat for Fabry disease. The company hopes to file for EU approval this quarter and for FDA approval later this year. If migalastat is approved, it will face off against Sanofi's Fabrazyme and Shire's Replagel, two drugs that generate hundreds of millions of dollars in sales annually.

Since Sanofi and Shire's drugs have been commercial successes, migalastat's market opportunity could be big, especially since it's dosed orally rather than injected, giving it a convenience advantage over its competitors.

Before investors get too excited, though, they should know that Amicus' path to market for migalastat has been rocky. In 2013, co-development partner GlaxoSmithKline walked away from migalastat following a disappointing phase 3 readout, and it wasn't until Amicus crunched the data and discovered that migalastat worked much better in a subset of patients that represent between 30% and 40% of Fabry cases that new life was breathed back into its migalastat program.

Assuming no unforeseen roadblocks pop up that could block Amicus' plans to submit its applications, the company could conceivably be marketing migalastat at some point next year. If those marketing efforts prove successful in winning away business from Fabrazyme and Replagel, investors may ultimately decide that Amicus is worth more than its current $1.1 billion market cap.

Tying it together
All three of these biotech stocks are hit-and-miss plays that may or may not end up with needle-moving products on the market. That makes them best-suited for risk-resilient investors who can handle the potential for failure. However, it's my opinion that Relypsa, Esperion Therapeutics, and Amicus could prove to be profit-friendly, and for that reason, they're worth consideration for portfolios.

The article 3 Biotech Stocks You Might Not Know About, but Ought to Consider Buying originally appeared on Fool.com.

Todd Campbell owns shares of Amicus Therapeutics and Esperion. Todd owns the equity research firm E.B. Capital Markets, LLC. E.B. Capital's clients may have positions in the companies mentioned. The Motley Fool recommends GlaxoSmithKline. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.