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The best UK biotech shares to buy in 2021? – The Motley Fool UK

The global pandemic has brought UK biotech shares into the spotlight. And I’ve been looking around the sector to see if there are any I might want to buy now. Some are almost certainly overpriced. But there are good companies out there that I might buy on any future dips.

I’ve recently examined e-Therapeutics. The company develops software-based drugs assessment technology. For its new pandemic project, the firm aims to “identify approved and known drugs that could rapidly be repositioned for the treatment of Covid-19.” Anything that speeds up that process could be in great demand in the future. But with the shares up 1,000% in two years, it’s expensive and not a UK biotech share I’d buy now.

Another soaring Covid-related share price

Avacta Group shares are up over 800% over two years too and, again, I think that’s too rich for now. But I expect better buying opportunities in the future. It’s another company whose technology I like. It appears to have one of the best Covid-19 lateral flow tests, which it hopes will be on the market very soon. With an increasing number of competing products though, and with the rapid pace of development in the field, I’m waiting to see what the next few months bring.

A fishy UK biotech share

UK biotech shares are pretty much dominated by coronavirus research at the moment. So how about Benchmark Holdings as an alternative? Forget viruses, Benchmark is into fish. The company researches fish genetics for improving strains and raising disease resistance. And it has divisions focusing on specialised foods and treatments for aquatic diseases.

The share price hasn’t done much over the past five years, but it’s been picking up since the start of 2020. The downside though is that Benchmark isn’t currently profitable. But I’m putting it on my watchlist as a potential buy, and I’ll do some more research.

There’s another UK biotech share that piques my interest, and it’s another that’s not doing Covid stuff. It’s still medical though, and researches treatments for diseases that affect the brain, immune system and gut. I’m talking of PureTech Health, and I see its structure as helping alleviate risk. PureTech does some of its own research, but it’s also a stakeholder in the Founded Entities group of nine companies involved in complementary research. We’re looking at a somewhat elevated share price, mind. PureTech is up 180% over five years, but it has been dipping of late. It’s definitely another I’m watching.

An unmissable candidate?

No list of UK biotech shares would be complete without Oxford Biomedica. Yes, we’re back to a company involved in Covid research — it played a big part in developing the AstraZeneca vaccine. But the company partners big pharma companies in research into other gene and cell-based therapies. The shares are up only a modest 49% over the past two years, so we’re not seeing the same pandemic-driven spike that’s pushed some to stratospheric levels.

I like the look of all these companies, though I’m not sure I’d buy any right now, especially not the really big climbers. But I’d like to add a biotech stock to my portfolio, and I’m watching all of them.

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Alan Oscroft has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.


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