For investors looking for a strong growth option and willing to take additional risk, the biotech sector offers an unprecedented opportunity. Unlike other names, biotech companies often only rely on a few key milestones such as data displays or FDA approvals. So when a particular outcome goes down a company’s path, the news can act as a catalyst that can send stocks skyrocketing. However, investors seeking exposure to this area should know that doing so also increases the risk of these stocks as adverse outcomes can have the opposite effect. As a result, it can be more difficult to determine the strength of the investment opportunities in this sector. What’s the best way to measure biotech stocks before big catalysts? We recommend reaching out to Wall Street analysts for advice. Using the TipRanks database, we were able to identify two such stocks that are approaching significant catalysts. The platform also showed that these Strong Buy tickers have impressive upside potential from current levels. Ardelyx (ARDX) We’re starting Ardelyx, a biopharmaceutical company focused on developing therapies to improve the management of complications from kidney and heart disease. This is a niche with a large patient base that has been partially overlooked in the medical research industry. Ardelyx has developed Tenapanor, a targeted low molecular weight therapy. This prime drug candidate is currently being investigated for its use in the control of serum phosphorus in adult dialysis patients with chronic kidney disease. Ardelyx believes that Tenapanor makes it possible to achieve effective and consistent control of phosphate levels in the blood. To date, Tenapanor has met its primary endpoint in three Phase 3 clinical trials. The studies evaluated the effectiveness and safety of the drug candidate. Two (BLOCK and FREEDOM) were monotherapy studies in adult CRF patients undergoing dialysis, while the third (AMPLIFY) was a two-mechanism study. Ardelyx currently has an open label extension study underway. The positive results of the Phase 3 studies form the background for the company’s new drug application with the FDA. This is an important milestone in the development and approval process. The deadline is April 29, 2021 – this is the PDUFA (Prescription Drug User Fee Act) date for Tenapanor. Ahead of the upcoming PDUFA appointment, Wedbush analyst Laura Chico believes a successful outcome is in sight. “Simply put, we see Lead Asset Tenapanor as novel and differentiated, with the potential to disrupt the treatment of hyperphosphatemia in patients with chronic kidney disease on dialysis. The novel mechanism, robust serum phosphate lowering comparable to commercially available phosphate binders, and lower pill exposure create a differentiated profile. Small-cap launches aren’t for the faint of heart, but we’re seeing Tenapanor’s profile resonating with medical professionals. Since the pipeline is a call option, we are assuming approval on time (PDUFA 04/29/21) and a start in the third quarter of 21, ”said Chico. In line with their comments, Chico rates ARDX as an outperform (i.e. buy), and their target of $ 14 implies an uptrend of 129% for a year. (To see Chico’s track record, click here.) That Wall Street likes this stock is clear from Strong Buy’s unanimous consensus rating. This consensus is based on 4 recent purchase reviews which is good news for Ardelyx. The shares are priced at $ 6.10 and their average price target of $ 14 is in line with Chico’s. (See ARDX stock analysis on TipRanks) Heron Therapeutics (HRTX) The second biopharmaceutical company we see here, Heron, is starting with a step up – it has two drugs that are already FDA approved and on the market. Heron’s two approved drugs, Sustol and Cinvanti, are both indicated for the treatment of nausea, which is often caused by chemotherapy. This is a serious side effect that has a significant negative impact on the quality of life of many cancer patients – even if chemotherapy is effective. An effective anti-nausea drug should be a net boon to the company, and Heron expects sales for the two drugs to be between $ 130 million and $ 145 million in 2021. However, the main catalyst for the company is the upcoming PDUFA appointment for HDX-011 (Zynrelef). HDX-011 is indicated for the control of post-operative pain in small to medium sized surgical wounds in adults. A marketing authorization was granted by the European Commission in September 2020. The next milestone is the PDUFA date for FDA approval, which is currently set for May 12, 2021. Heron’s first application was filed in October 2018, followed by a full response letter (CRL) in April 2019. The CRL requested additional non-clinical and CMC data. The NDA was re-submitted in October 2019, followed by a second CRL in June 2020 for additional non-clinical information. The third time is the stimulus? The Stifel analyst Derek Archila believes this. “We continue to like stocks and believe that HTX-011 (Postoperative Pain) approval, expected in May 2021, is positive. Although HTX-011 has already been hindered by two CRLs, we believe that approval in the EU presents risks to clinical efficacy and safety and that the minor issues raised by the FDA with the excipients used should be addressed. With our approval, stocks could move in the $ 20-20 range, “commented Archila. Archila’s optimistic outlook for Heron is reflected in a buy rating and a target price of $ 28, which gives room for 87% growth. in the next 12 months. (To see Archila’s track record, click here.) We’re again looking at a stock with a unanimous consensus view for a strong buy. Heron has 3 recent buy ratings and an average price target that is slightly more bullish than Archila is allowing $ 30.33 meaning a potential upward movement of ~ 103% over a one year time horizon. (See HRTX stock analysis on TipRanks.) To find great ideas for trading biotech stocks at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched stock tool that brings together all of TipRanks’ equity insights Disclaimer: The opinions expressed in this article are exclusive Finally, that of the presented analysts. The content is intended to be used for informational purposes only. It is very important that you do your own analysis before making any investment.