Biopharmaceutical stocks had their ups and downs over 2021 but volatility in the sector is par for the course. Drug developers see their fortunes rise and fall on the outcomes of clinical trials and regulatory bodies can present challenges to companies looking to commercialize their products. To help navigate any rough waters over the year ahead, Cantech Letter has three names in the space with recent positive reviews by analysts, delivered here in no particular order. 1. Medicenna Therapeutics (Medicenna Therapeutics Stock Quote, Charts, News, Analysts, Financials TSX:MDNA) Market cap: $120 million 2020 revenue: $0 2021 year-to-date return: -63 per cent Immuno-oncology company Medicenna focuses on novel interleukin (IL)-based treatments and has candidates MDNA55 currently in clinical trials for recurrent glioblastoma and MDNA11 for patients with advanced solid tumours. Earlier this month, Medicenna announced an expansion of its Phase 1\/2 ABILITY study of MDNA11 to clinical trial sites in Canada, which came after clearance from the US FDA for clinical trial sites in the US and with the company already enrolling patients in Australia. Medicenna is pre-revenue but Research Capital Corp analyst Andr\u00e9 Uddin has said that\u2019s likely to change in 2022 as the company is close to signing a licensing deal for MDNA55 before starting a Phase 3 trial. \u201cMDNA plans to out-license MDNA55 before a Phase 3 trial is initiated,\u201d wrote Uddin in a report to clients on November 12. \u201cWe are confident the company can sign a licensing deal for a few reasons: (i) MDNA55 has Orphan Drug designation, (ii) the company has a solid data package based on its Phase 2b study, and (iii) the Phase 3 is a unique and cost-effective trial design. We are currently assuming a potential deal could be forged in Q1\/CY22 with $60 million in upfront.\u201d With his update, Uddin reiterated his \u201cSpeculative Buy\u201d rating for Medicenna and $6.90 target price, which translated to a projected one-year return of 170 per cent. (All returns are stated as per the publication date of each analyst\u2019s respective report.) 2. Alpha Cognition (Alpha Cognition Stock Quote, Charts, News, Analysts, Financials TSXV:ACOG) Market cap: $72 million 2020 revenue: $0 2021 year-to-date return: -17 per cent Biopharm company Alpha Cognition is a new entry into the public markets, having arrived on the TSX Venture Exchange earlier this year. Another pre-revenue operation, ACOG focuses on neurodegenerative diseases and has a lead candidate in ALPHA-1062 which is a patented drug for the treatment of Alzheimer\u2019s disease. ALPHA-1062 belongs to the class of Alzheimer\u2019s drugs that are the current standard of care treatment, with the drug potentially proving to be the best-in-class options for the 45 per cent of patients who discontinue acetylcholinesterase inhibitor (AChEI) drugs within a year of starting treatment, mainly due to gastrointestinal side effects, while ALPHA-1062 is being brought forward as an option without those side effects. iA Capital Markets analyst Chelsea Stellick has noted there\u2019s a massive potential market size for Alpha Cognition\u2019s lead drug, with over 6.3 million Alzheimer\u2019s patients in the US\u00a0 currently and that number expected to double by 2050.\u00a0 \u201cBased on existing sales, AChEIs are a >$5 billion market at branded prices. Capturing even a small percent of this market would bring an order of magnitude increase in ACOG\u2019s valuation, and very likely be accompanied by a buyout or a Nasdaq uplisting,\u201d said Stellick in a coverage initiation on Alpha Cognition on October 19. Stellick said ACOG has strong data on ALPHA-1062 with a low bar for approval where it requires only bioequivalence rather than efficacy, making its Phase 3 trial faster and smaller than typical, with a New Drug Application planned for 2022. \u201cAlpha Cognition is de-risked, late stage, and offers a unique combination of high reward with less-than-usual risk thanks to the well-established AChEI market and our evaluation of its preclinical and clinical data in the context of a 505(b)(2) pathway to approval," Stellick wrote. With her initiation, Stellick gave ACOG a \u201cSpeculative Buy\u201d rating and $5.00 target, which represented a projected return of 265 per cent. 3. Knight Therapeutics (Knight Therapeutics Stock Quote, Charts, News, Analysts, Financials TSX:GUD) Market cap: $642 million 2020 revenue: $200 million 2021 year-to-date return: -2 per cent Specialty and generic drug company Knight Therapeutics has been a disappointment for investors over the past few years, as the market waits for GUD to acquire more assets and partake in more M&A to boost its top and bottom lines. The company did make a splash in 2020, however, with the acquisition of Grupo Biotoscana, which gave it a footprint across ten countries in Latin America and now over 100 products and markets across 11 countries. \u00a0 Knight delivered third quarter earnings last month which showed revenue up 62 per cent to $73.3 million and adjusted EBITDA up 311 per cent to $17.3 million. Both numbers came in higher than expected, with Paradigm Capital analyst Scott McAuley saying in a quarterly review of the company on November 12 that the significant underperformance of the stock since late 2020 is part of his bullish take on Knight. \u201cGUD continues to have a strong balance sheet with $156.0 million in cash, cash equivalents and current marketable securities. The company generated net cash flow from operations of $10.3 million in the quarter and used $17.9 million under the NCIB. Also, GUD has significant other financial assets totalling $189.7 million. These will provide additional future liquidity that it can deploy for funding its NCIB, licensing, or M&A activity,\u201d McAuley wrote.\u00a0 With the update, McAuley maintained his \u201cBuy\u201d rating but dropped his target from $7.75 to $7.50 per share, with the decrease being attributed to changes in cash and other financials assets as opposed to changes in his estimates on GUD. At press time, McAuley\u2019s new target represented a projected return of 42 per cent.