Despite Massive Gains This Year, This Biotech Stock Is a Risky Bet
The broader stock market has performed relatively well this year, with the S&P 500 index up by about 23% since the beginning of the year. However, some stocks have performed much better than that. One of them is Arrowhead Pharmaceuticals (NASDAQ: ARWR), a biotech stock that's up by more than 420% since early January.
These gains are impressive by almost any standard, but despite the company's trouncing the market this year, an investment in Arrowhead is a risky move -- here's why.
Arrowhead focuses on the development of medicines using RNA interference (RNAi) technology, which seeks to "silence" the genes that cause certain illnesses. The major catalyst behind the company's recent performance was its partnership with Janssen Pharmaceutical, a company owned by Johnson & Johnson (NYSE: JNJ). Per the agreement, Janssen acquired the exclusive right to license ARO-HBV (now called JNJ-3989), a drug being developed to treat hepatitis B.
Source Fool.com
