Last year, the biotechnology industry leaned heavily into the power of artificial intelligence (AI), using machine learning models to identify drug targets, to optimize molecules, and to make key predictions about trial outcomes. Alongside the continued proliferation of technology within the drug development space, companies with a focus on obesity, rare diseases, and oncology applications saw commercial achievements.
Heading into 2026, the landscape could continue to reward investors willing to take on a bit of risk. The benefit of lower interest rates and improved funding conditions may drive further investment in biotechs, particularly in companies with clear paths toward commercial success. Many of the standout biotech stocks to watch in 2026 have tangible catalysts to drive growth.
Major Mental Health Disorder Treatment Potential for Atai Beckley
Atai Beckley (NASDAQ: ATAI) develops therapies for mental health disorders, including treatment-resistant depression (TRD) and substance use disorders, among others. Shares of this penny stock rose by an impressive 175% in the last year, despite trailing off somewhat in the final weeks of 2025. Helping to motivate investors in the last several quarters has been the completion of the combination of atai Life Sciences and Beckley Psytech, accompanied by a redomiciliation to the United States.
Investors may want to watch Atai Beckley for updates on its BPL-003, a nasal spray in development for TRD and alcohol use disorder, which saw positive topline results in a Phase 2b trial last July and other promising data in November. The Phase 3 trial will likely start in the second quarter of 2026. The company's pipeline is sizable and also includes other TRD candidates and a potential treatment for social anxiety disorder.
ATAI's clinical momentum and potentially massive market make it promising, but it will have to navigate high R&D expenses and very modest revenue. In this way, 2026 may be a make-or-break year for the company. Investors willing to take a chance on a highly promising TRD treatment may reap substantial rewards.
Hemodialysis Wins and Broadening Into New Spaces Could Drive CorMedix This Year
We've previously highlighted CorMedix Inc. (NASDAQ: CRMD) for its dominance in the catheter lock space, as its DefenCath has shown potential for reducing catheter-related infections and hospitalizations among dialysis patients. The company's secret weapon, though, may be REZZAYO, a treatment for candidemia in the midst of a Phase 3 trial, with data expected next quarter.
CorMedix is also broadening its pipeline outside of its core hemodialysis business, including with the recent acquisition of Melinta Therapeutics, known for its fungal and bacterial infection treatments. The portfolio from Melinta boosted CorMedix's sales by about $13 million in September alone, and investors might expect an additional boost when the company reports full-year results.
The firm's impressive third-quarter 2025 results, including big wins on both top- and bottom-line performance, along with its strong cash position, should help to provide a buffer as healthcare reimbursements face uncertainty in the new year. This may be why analysts have set a consensus price target for CRMD shares of $17.86, about 153% above current levels.
Big Potential in the Atopic Dermatitis Space for New Entrant Evommune
With a focus on chronic inflammatory diseases, Evommune (NYSE: EVMN) is the most recent biotech stock on our list to go public. Shares became available via IPO in November 2025, and EVMN has climbed by nearly 14% in just the first two months or so of trading. As such, investors have less historical context for this company than the others above, but there are nonetheless reasons to expect 2026 may be a breakthrough year.
In the third quarter of 2025—the only quarterly report Evommune has issued since going public—the firm highlighted key Phase 2 data readouts on its EVO756 and EVO301 for potential treatment of chronic inducible urticaria and certain types of atopic dermatitis, respectively. Top-line results from both trials are expected in the first part of this year and could be a significant catalyst for growth for the business. Evommune's attempts at tackling atopic dermatitis could be especially beneficial for the company, as AD is the most prevalent autoimmune disease, and patients face a dearth of treatment options.
So far, Evommune has managed to maintain a healthy, though small, cash position, building to $76 million by the end of the third quarter. It has also begun to generate revenue thanks to a licensing agreement in Japan, although R&D expenses should remain high. Analysts are quite optimistic about EVMN's prospects, expecting more than 84% in potential upside.
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The article "High Risk, High Reward: 3 Healthcare Stocks to Watch in 2026" first appeared on MarketBeat.
