Top Biotech Stocks in Canada of 2026

In 2025, the Canadian biotech sector saw renewed momentum, with investor interest and funding rebounding. The second half of 2024 brought in roughly CAD 672 million in new financing, reflecting growing confidence across Canada’s 3,800-plus life-sciences companies.

Innovation is accelerating in areas like advanced therapies, precision medicine, and biomanufacturing, supported by government investment and expanding domestic production capacity. Key biotech hubs (Ontario, Quebec, and B.C.) continue to strengthen their global profiles, benefiting from collaboration between universities, startups, and industry.

Despite this progress, challenges persist, including inconsistent funding, global competition, and ongoing talent shortages. Still, rising demand for next-generation treatments and expanding infrastructure position the sector for solid long-term growth.

Canada’s biotech industry is poised for major growth in 2026, driven by rapid advances in cell and gene therapies, precision medicine, and AI-powered drug discovery. Significant investment is flowing into new biomanufacturing facilities and commercialization hubs, positioning Canada to scale from research to market-ready therapies. Demand for talent in genomics, bioinformatics, and biomanufacturing is rising. With the biotech market projected to grow strongly through 2030, health-focused “red biotech” will lead expansion, supported by government initiatives, stronger infrastructure, and increasing global demand for advanced therapeutics.

Given the complexity of this market sector, the biotech space can be tough to understand. Below we’ll break down biotech stocks and help you decide if you should invest in them.

What are biotech stocks?

Biotech stocks are healthcare companies that make drugs and vaccines out of living organisms, such as enzymes and bacteria. Though similar in their pursuit for treatments, biotech stocks differ from pharmaceutical companies, which make drugs from chemical bases, not living ones.

Regulation of biotech companies

Because of regulations and government approval, biotech companies must undergo a rigorous, costly, and long process to put drugs on the market. In general, a company has to complete four stages before it can sell its products:

1. Research and discovery  

In the research and discovery phase, biotech companies identify diseases and begin laying the foundations for a new drug to treat it.

Companies in this stage often use intense amounts of capital to fund research, while often having no product or major source of revenue to replenish financial reserves. Of all the biotech companies, those in the research and discovery stage are the riskiest investments, as it’s not yet clear if the company will succeed or fail.

2. Preclinical testing

Once a company has developed a concept or theory, they move into the preclinical testing phase to prove that it works.

In the preclinical phase, companies will test drug candidates in test tubes (called in vitro) or on mice (in vivo). The purpose of this phase is to show regulators that the drug not only works but is safe to test on humans. Though companies in the preclinical testing phase are farther along than those in phase one, they can still present risks to investors, such as high volatility, insignificant sources of revenue, and the potential to fail.

3. Clinical testing

When a company shows regulators that their drug candidate is effective and safe, the product passes into clinical testing. During clinical testing, biotech companies will start experimenting on humans in three different phases:

• Phase 1 is a small study that determines how much of a new drug the body can tolerate. Subjects in this phase are usually healthy adults, not patients who have the health condition the drug is trying to treat.

• Phase 2 is a much larger study that involves patients who have the health condition. The purpose of phase 2 is to determine if the new drug reduces symptoms or produces side-effects in patients.  

• Phase 3 is another study on patients with the health condition. The point of this phase is to prove that the drug is both safe and successfully treats the patient’s health condition.

4. Regulatory approval

Once a biotech company has successfully completed phase 3 of its clinical testing, it must get regulatory approval to put its drug on the market. Passing from clinical testing to regulatory approval is a major step, as it means the biotech has a product to sell.  

Top Canadian biotech stocks 

In the last two decades, an exciting biotech market has emerged on the Toronto Stock Exchange (TSX). 

While most of these stocks are still small caps, many have the innovation and research to grow into larger businesses. If you’re interested in biotechnology stocks in Canada, here are three top companies you should consider.

1. Theratechnologies 

Headquartered in Montreal, Theratechnologies (TSX:TH) is a biotech company that develops innovative therapies for unmet medical needs in HIV, oncology, and NASH, a type of liver disease. 

The company’s superstar product is EGRIFTA. This injection medicine reduces a kind of fat called “visceral fat,” which is deeper and harder to remove than “subcutaneous fat,” the kind of fat that’s easier to burn through exercise and diet. Visceral fat often occurs in adults who live with HIV and lipodystrophy. If left untreated, it can exert uncomfortable or life-threatening pressure on internal organs. 

The most critical event for Theratechnologies in 2025 was its acquisition by Future Pak in September, concluding its tenure as a publicly-traded company. Prior to the acquisition, the company secured a significant regulatory achievement: the FDA approval of EGRIFTA WR™ (tesamorelin F8) in March. This new, more convenient weekly-reconstituted formulation for HIV-associated lipodystrophy became available in September, serving as a key commercial asset going into the sale. The company also maintained positive financial momentum, reporting a fifth consecutive quarter of positive Adjusted EBITDA before the transaction closed.

The company’s focus for 2026 is now directed by its new owner, Future Pak. The acquisition structure provides insight into the planned objectives via Contingent Value Rights (CVRs) issued to former shareholders. These CVRs are tied to achieving specific commercial milestones related to driving the uptake of the new EGRIFTA WR™ formulation, advancing the oncology pipeline (sudocetaxel zendusortide), and achieving certain regulatory or commercial success with its existing products in new global markets.

2. BriaCell Therapeutics

BriaCell Therapeutics (TSX: BCT) is a biotech company that develops primarily immunotherapies to help women fight breast cancer. Just this past December, Briacell completed a public offering, raising approximately $5.5 million to support its ongoing clinical programs.

An immunotherapy is a cancer treatment that enhances a patient’s immune system and helps them fight cancer cells through the body’s natural defense system. It’s considered a more effective treatment of certain types of cancer, as it teaches an immune system how to react to cancer cell, rather than removing them synthetically through chemotherapy.

BriaCell Therapeutics’ 2025 success focused on demonstrating strong clinical benefit for its lead immunotherapy, Bria-IMT, for metastatic breast cancer. Key achievements included presenting positive Phase 2 survival data for heavily pre-treated patients and advancing its pivotal Phase 3 study (BRIA-ABC), which received FDA Fast Track Designation. Furthermore, the company expanded its pipeline by spinning out its small-molecule assets into a subsidiary and initiating an AI-driven drug discovery collaboration.

The primary objective for BriaCell in 2026 is the crucial interim analysis of the Phase 3 BRIA-ABC trial, expected in the first half of the year (H1-2026). The results of this analysis will determine the potential for accelerated approval and market entry for Bria-IMT. Concurrently, the company will continue to develop its next-generation platform, Bria-OTS+, supported by its collaboration with Memorial Sloan Kettering Cancer Center, to enhance its off-the-shelf immunotherapy strategy.

3. Medicenna Therapeutics Corp. 

Medicenna Therapeutics (TSX:MDNA) is a clinical-stage immunotherapy company that is developing cancer treatments. 

Medicenna’s 2025 accomplishments were dominated by advancing its lead asset, the IL-2 Superkine MDNA11. The company presented updated data from its Phase 1/2 ABILITY-1 study, confirming strong single-agent anti-tumor activity and a favorable safety profile in combination with pembrolizumab for solid tumors. They also initiated the new randomized NEO-CYT trial for MDNA11 in high-risk melanoma and progressed the preclinical development of their next-generation bispecific, MDNA113.

For 2026, Medicenna’s key goals are centered on pipeline progression and late-stage planning. The company expects to present further MDNA11 clinical data and solidify its Phase 2b development strategy early in the year. Crucially, they plan to advance the bispecific MDNA113 into IND-enabling studies in H1 2026 and aim for a first-in-human clinical trial in H2 2026, signaling the clinical launch of their next-generation platform.

Investing in foreign biotech stocks 

While Canada’s biotech sector is growing, you’ll find some of the largest biotech companies trading on U.S. exchanges. For those interested in buying international stocks, here are just a few U.S. biotech stocks you might want to consider.  

Are biotech stocks right for you? 

Biotech stocks are great buy-and-hold investments for those seeking long-term future growth. They’re also ideal for scientifically minded investors, or those with a deep understanding of the biotech industry. Before you invest in them, however, you should be aware that these investments are often volatile and come with a unique set of risks. 

Perhaps the biggest risk is a failure in clinical testing. A biotech company may have an innovative idea or drug that can treat certain diseases. But if it can’t turn that solution into a safe and effective product, the company could find itself without a flagship drug and millions of dollars spent on research. Even if a company’s drug passes the clinical trial phase, it then has to meet regulations. Beyond that it has to sell and capture market share.  

The least risky biotech companies will already have successful drugs on the market, and they’ll likely be researching, developing, and testing new drugs. Many of the most promising companies in this sector will focus on treating more than one health condition, and they may even have various drugs for each disease. 

If you don’t want to pick your own biotech stocks, but you’d still like to benefit from this profitable industry, you could always buy shares in a biotech-focused exchange-traded fund (ETF).

Unfortunately, at this time, Canada doesn’t have a biotech ETF listed on its exchanges. If you’re okay with investing in the U.S. market, these ETFs are worth considering:

• BlackRock IShares Biotechnology ETF
• ARK Genomic Revolution ETF
• SPDR S&P Biotech ETF