As the year 2014 heads toward the finish line, many of the top Wall Street firms are sharpening their pencils and getting top ideas that make good sense for 2015 out to the institutional and retail clients ready to reposition capital for what could prove to be a slower year. One sector that could be poised to do well could be the biotech arena, and the team at RBC has five top stocks for investors to focus on as best ideas for next year.

Health care and biotechnology had outstanding performance numbers this past year, with health care up the second highest of any sector in 2014 at 23.25% through last Friday. The RBC team views the biotech sector as having very solid fundamentals, innovation that continues to grow, a host of companies with outstanding pipelines for a variety of treatments, and mergers and acquisitions still at the forefront.

Here are the five top biotech ideas at RBC for 2015: Biogen Idec Inc. (NASDAQ: BIIB), BioMarin Pharmaceutical Inc. (NASDAQ: BMRN), Celgene Corp. (NASDAQ: CELG), Regeneron Pharmaceuticals Inc. (NASDAQ: REGN) and Vertex Pharmaceuticals Inc. (NASDAQ: VRTX).

Biogen Idec

One of top stocks to buy on Wall Street, many predict that Biogen’s Tysabri earnings will have a meaningful jump this year and beyond. Wall Street analysts applauded the release of data on a monoclonal antibody called BIIB033, which is safe and tolerable in people, according to the combined results of two Phase 1 clinical trials that tested high doses in healthy people and those with multiple sclerosis.

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The RBC analysts see the company as the most catalyst-rich stock in their universe, with the biggest upside potential, versus downside on three specific events next year, including Tysabri SPMS, Alzheimer’s treatments and continued impressive LINGO BIIB033 upcoming Phase 2 data.

RBC has a $400 price target for the stock. The Thomson/First Call consensus price target it set at much lower at $377.48, and Biogen closed Monday at $352.29.

BioMarin

This one is often touted as a possible takeover target. Many on Wall Street think that media speculation of big-pharma interest in BioMarin is likely related to the company’s commercial success of the orphan drug model globally. Its diversified and expanding pipeline could also provide significant strategic value to acquirers. The RBC team sees up to five potential pipeline readouts in 2015.

While some important Phase 3 data for BioMarin was moved to next year, a successful Vimizim launch is key to the near-term success and momentum for the stock. Launched in back mid-February, the drug is expected to have $60 to $70 million in sales this year.

The RBC price target for this top mid-cap idea is $110, and the consensus target is posted at $102.47. Shares closed at $92.80 Monday.

Celgene

Celgene is one of the RBC top picks for next year, as the analysts feel this large cap stock has solid upside potential for 2015 and an outstanding partnered pipeline. They also think the company can grow earnings 20% or more next year and 2016.

The big biotech presented results this past summer from an analysis that showed encouraging news for blockbuster drug Revlimid as a treatment for multiple myeloma. A combination of Revlimid and low-dose dexamethasone significantly improved overall survival and progression-free survival rates, leading some experts to conclude that the treatment probably will become the new standard of care for the disease. But many on Wall Street see Celgene working to diversify away from the flagship products through the emerging inflammation and immunology franchise, and a rich pipeline of alliances.

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The RBC team has a $135 price target on Celgene, and the consensus target is $112.09. Celgene closed on Monday at $113.50 a share.

Regeneron

Another top pick at RBC for 2015, this company has been a performance monster over the past two years, and most Wall Street firms expect it to stay one. With treatments for everything from macular degeneration to colorectal cancer, the company continues to exploit an extraordinary pipeline.

The RBC analysts are very positive on Regeneron’s prospects for solid Eylea growth, and others on Wall Street cite Alirocumab, which is another new cholesterol drug with big expected upside. In fact, doctors think the yearly cost for the new cholesterol drugs could be $8,000 to $10,000 per year per patient. This could add substantial earnings to current estimates.

The RBC price target is posted at $477, and the consensus is much lower at $404.30, though the stock did close Monday at $412.97.

Vertex

Another large mid-cap cap biotech leader that is favored for next year by the RBC analysts, Vertex got on the biotechnology map with a blockbuster hepatitis C drug, and it looks poised to get revenue growing again with its cystic fibrosis franchise.

Earlier this fall, Vertex submitted regulatory applications in the United States and Europe seeking approval for its fully co-formulated combination of lumacaftorand Kalydeco for use in cystic fibrosis patients. Approval is expected by some in the first half of 2015. This could help drive additional large revenue streams next year.

The RBC price target for the stock is $130, and the consensus target is set at $125.27. Shares closed Monday at $116.68.

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While biotech investing is only suitable for very aggressive accounts, these top stocks to buy make good sense for long-term investors who can stomach the volatility inherent in the sector. Volatility aside, they all could show big gains for investors in 2015.

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