Key Points
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The healthcare sector has chronically underperformed in the past few years, trailing S&P 500 performance by a wide margin.
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Investing in biotech companies can be risky due to product failures and regulatory pressures.
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The worst performer on our list plunged 82.23% in the last year.
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The healthcare sector has chronically underperformed in the past few years. There have been some clusters in the healthcare industry that have done well, but the broader picture remains bland.
Take the iShares U.S. Healthcare ETF, for example. It has delivered 31.21% in the past five years. The S&P 500 has delivered nearly triple that, at 86.82%. This underperformance is a rare post-pandemic phenomenon, considering IYH delivered 400%+ gains from 2010 to August 2024, when it peaked.
But that 31.21% return will look like a blessing when you take a look at the worst underperformers in the sector for the last year. Here are nine healthcare stocks (companies with a $500 million+ market cap) that have performed poorly, along with the reasons.
#9 NovoCure Ltd. (NVCR)
NovoCure is an oncology company with a maturing glioblastoma (GBM) franchise and slow launches outside GBM as it develops and commercializes novel cancer therapies. The stock is down 51.39% in the last year as investors focused on cash burn, the costly launch curve, and limited adoption beyond GBM, which together pressured revenue growth expectations and the multiple.
With a market cap of $1.389 billion, NVCR is priced at $12.40 per share.
#8 Biohaven Ltd. (BHVN)
Down 69.69% in the last year, Biohaven has a pipeline across neuroscience, immunology, and oncology, such as Kv7 modulators and antibody-degrader platforms.
Why Biohaven declined so much: Shares ($11.82) slid after a bipolar-mania study of BHV-7000 failed and the company withdrew the EU application for the neuro drug troriluzole (Dazluma). This dented near-term catalysts and confidence in the pipeline. The company’s market cap is $1.568 billion.
#7 Inspire Medical Systems (INSP)
Inspire Medical Systems makes implantable hypoglossal-nerve stimulation devices to treat obstructive sleep apnea as an alternative to CPAP. The stock dropped 61.08% in the last year. Management flagged GLP-1 weight-loss/OSA drugs as a headwind to procedure volumes and cut expectations while the Inspire V rollout lagged. Later updates and guidance resets compounded concerns about growth durability and competitive dynamics.
INSP shares are $75.78. The market cap is $2.241 billion.
#6 Tandem Diabetes Care (TNDM)
Tandem is down 46.26% in the one-year period. The company designs and sells insulin pumps and connected diabetes-management solutions for people with diabetes. The stock fell hard on lighter-than-expected 2025 sales guidance and subsequent earnings that missed EPS expectations. Additional post-earnings selloffs on mixed quarters and margin worries kept the shares weak, though the stock has rebounded from August lows.
Tandem’s market cap is $1.349 billion and shares are priced at $19.89.
#5 PROCEPT BioRobotics (PRCT)
Dropping 59.54% in the last year, PROCEPT BioRobotics makes the Aquablation robotic surgical system to treat benign prostatic hyperplasia (BPH), supported by a permanent CPT code and improving Medicare reimbursement. Why the stock declined so much: Enthusiasm is declining and so is the premium shareholders are willing to pay for PRCT. The CEO retired last summer and analysts have lowered their price targets.
The company has a market cap of $1.618 billion; shares cost $28.96.
#4 Geron Corp. (GERN)
Geron dropped 52.43% in the last year. The company sells Rytelo (imetelstat), a first-in-class telomerase inhibitor for lower-risk myelodysplastic syndromes (blood cancers), and makes telomerase-targeted therapies. Rytelo sales have been weak since launch and the company has been missing estimates. Lingering skepticism from prior FDA review discussions about imetelstat’s clinical meaningfulness and safety is another overhang on valuation and sentiment.
GERN can be bought for $1.37. The market cap is $874.547 million.
#3 Iovance Biotherapeutics (IOVA)
Down 58.94%, Iovance Biotherapeutics is a commercial-stage biotech selling Amtagvi (lifileucel), a tumor-infiltrating lymphocyte therapy for advanced melanoma. The company missed earnings expectations and revenue targets last year. Plus, cash is dwindling and the company is being forced to dilute shareholders to keep the lights on.
IOVA shares are $2.55. The market cap is $1.012 billion.
#2 Sarepta Therapeutics (SRPT)
Sarepta Therapeutics stock plunged 82.23% in the last year. The genetic-medicine company markets the Duchenne muscular dystrophy gene therapy Elevidys and develops additional RNA/gene therapies. The stock plunged last summer on a “double whammy” of a sharply reduced 2025 sales outlook and regulatory headlines that rattled sentiment around Elevidys and the broader gene-therapy portfolio. More pressure came after reports of multiple patient deaths in investigational programs and the FDA saying it needs more safety data before further approvals.
Sarepta’s market cap is $2.131 billion. Shares cost $20.34.
#1 Moonlake Immunotherapeutics (MLTX)
This clinical-stage biotech is developing the IL-17 nanobody sonelokimab for inflammatory diseases such as hidradenitis suppurativa (HS). The stock plunged by 90% in late September after its sonelokimab Phase 3 clinical trial showed mixed results. A study failed to see statistical significance and many shareholders jumped ship.
For the year, MLTX is down 66.74%. The market cap is $1.11 billion and shares are priced at $15.67.
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