For the last year, many of the top pharmaceutical and biotech stocks have been under pressure from comments made by politicians looking to whip up voter enthusiasm. Recent issues over pricing were again raised, and the CEO of Mylan was forced to testify in front of Congress. The reality is, without the top companies in the space, treatment for many with debilitating conditions would never be found.

Now is a good time to look at the top companies, and in a new research report from Jefferies, many of the outstanding companies in pharmaceuticals and biotech space show up among the stocks to buy at the firm.

AbbVie

This is one of the top global pharmaceutical stocks picks across Wall Street. AbbVie Inc. (NYSE: ABBV) is a global, research-based biopharmaceutical company formed in 2013 following separation from Abbott Laboratories. The company’s mission is to use its expertise, dedicated people and unique approach to innovation to develop and market advanced therapies that address some of the world’s most complex and serious diseases. AbbVie employs more than 26,000 people worldwide and markets medicines in more than 170 countries.

One of the biggest concerns with AbbVie is what eventually might happen with anti-inflammatory therapy Humira, which generated $14 billion in sales in fiscal 2015. That was the most any drug has recorded during a single year and represents a gigantic part of the company’s overall earnings. The problem is that biosimilars and generics are itching to enter the market with Amgen leading the charge, and some Wall Street analysts project that AbbVie may have a difficult time stopping that trend.

Back in May, the patent board instituted Coherus BioSciences’ Inter Partes Review against the Humira ‘135 patent. The outcome of the review is expected in 12 months. While most analysts remain positive on Humira duration, the expected litigation uncertainty could continue to create an overhang on the stock, which does give investors chances to pick up shares lower.

The stock trades at a small discount to its large pharmaceutical peers, and some on Wall Street cite the biosimilar issue as a likely reason why. However, some on Wall Street are still less than thrilled over the steep price the company paid to buy Pharmacyclics.

AbbVie investors receive a 3.63% dividend. The Jefferies price target for the stock is $90, and the Wall Street consensus price target is $71.28. Shares closed Wednesday at $63.39.

Celgene

This company is a top large cap biotech pick the Jefferies team likes. Celgene Corp. (NASDAQ: CELG) has an outstanding partnered pipeline, which most think is low risk and has the potential to yield several blockbuster drugs. Certain Wall Street analysts also think the company can grow earnings 15% on a compounded annual growth rate basis going forward. Otezla, which treats psoriasis and psoriatic arthritis, had achieved considerable prescriptions among physicians, but the scripts have slowed after a solid launch, showing the importance for sales outside of the United States. Jefferies thinks they could be weak this quarter due to the launch of a competing product.

The company reported this week that the data from a randomized, double-blind, multicenter, exploratory Phase 1b study evaluating the effects of oral GED-0301 (mongersen) on both endoscopic and clinical outcomes in patients with active Crohn’s disease were accepted as a late breaking abstract at the United European Gastroenterology Week.

Wall Street analysts have noted that the company has discussed at their recent conference the benefits of longer duration Revlimid. Celgene has a very compelling pipeline, and with four existing Phase 3 trial assets, that may add strong new drugs and revenue prior to the end of the decade.

The $134 Jefferies price target is less than the consensus target of $137.43. The shares closed Wednesday at $105.29.

Gilead Sciences

This company is trading at an astounding multiple of less than seven times estimated 2016 estimated profits. Gilead Sciences Inc. (NASDAQ: GILD) discovers, develops and commercializes medicines in areas of unmet medical need in North America, South America, Europe and the Asia-Pacific. Its products include Stribild, Complera/Eviplera, Atripla, Truvada, Viread, Emtriva, Tybost and Vitekta for the treatment of human immunodeficiency virus (HIV) infection in adults; and Harvoni, Sovaldi, Viread and Hepsera products for the treatment of liver disease.

Second-quarter total revenues met consensus and earnings-per-share beat on strength in Sovaldi/HIV franchise. 2016 product sales guidance was lowered. HCV sales missed due to pricing, unfavorable payer mix, lower patient starts and shorter treatment duration. Share buybacks are expected to be lower for the rest of 2016, and many on Wall Street think that could suggest willingness for pipeline acquisitions.

Jefferies thinks that a spin-off of the hepatitis C silo of the business is entirely possible as the declining predictable revenues have weighed on the company’s overall valuation. While not a given, a transaction could improve long-term growth and improve the positive impact of a future acquisition or pipeline success.

Its investors receive a 2.42% dividend. Jefferies has a $93 price target, while the consensus figure is set at $102.94. The shares closed at $77.57.

Vertex Pharmaceuticals

This stock has long been considered a buyout candidate. Vertex Pharmaceuticals Inc. (NASDAQ: VRTX) engages in discovering, developing, manufacturing and commercializing small molecule drugs for patients with serious diseases in specialty markets. The company focuses on developing and commercializing therapies for the treatment of cystic fibrosis (CF) and hepatitis C.

Vertex markets Orkambi for the treatment of patients with CF 12 years of age and older who have two copies (homozygous) of the F508del mutation in their cystic fibrosis transmembrane conductance regulator (CFTR). The CFTR protein functions as a channel for the movement of chloride ions in and out of cells, which is important for the salt and water balance on epithelial surfaces, such as in the lungs or pancreas. They also market Kalydeco (ivacaftor) for the treatment of patients with CF 6 years of age and older who have the G551D mutation in their CFTR gene.

The Jefferies report noted:

With guidance for the third quarter and 2016 having recently been taken down, we expect limited focus on quarterly numbers, and interest in understanding the reasons behind the transient Orkambi lag during the Summer. We continue to expect a meaningful uptick in the fourth quarter given key opinion feedback suggesting a backlog of 6-11 year old patients.

The $105 Jefferies price target compares with the consensus target of $108.84 and the most recent close at $87.65.

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While these are very aggressive stocks, only suitable for risk-tolerant accounts, they could have big upside potential. Investors may want to scale buy some shares and keep some dry powder should any of the earnings data knock prices back.

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