Long-suffering biotech investors might be in for a treat as the SPDR S&P Biotech exchange begins to show signs of renewed strength.

Over the past three months, SPDR S&P Biotech has rallied 23%, fueled by a flurry of high-profile acquisitions of and by companies in the index. Large pharmaceutical companies, facing thinning pipelines, are aggressively acquiring cutting-edge biotech firms. Notable billion-dollar deals in the past two months include the acquisition of Verona Pharma by Merck, Sanofi’s buyout of Blueprint Medicines, and Eli Lilly’s purchase of Verve Therapeutics. In a significant technical move, the ETF has recently broken out above an eight-month trend of lower highs—an important shift dating back to the start of the current administration.

Gilead Sciences, a heavyweight in the biotech sector, continues to demonstrate strong relative strength trading just 5% below its 52-week high, compared with 16% for the SPDR Biotech ETF. The stock offers a compelling combination of capital appreciation potential and a solid dividend yield of nearly 3%. In May, shares found support at the psychologically significant $100 level and are now forming the right side of a potential cup base. A breakout above the early March highs near $120 could set the stage for a move toward $143 by year-end 2025.

Neurocrine Biosciences, a specialist in neuroscience-focused therapeutics, made a notable breakout on Wednesday, surging above the key $130 level. This price point, on a candlestick chart, had previously acted as resistance on Feb. 7 and May 6, both following earnings releases that triggered sharp negative reversals. Technical analysts view such a breakout as a bullish signal, often indicating that prior resistance may now serve as support. The stock appears poised to move toward $150, potentially filling the upside gap created on June 2.

Royalty Pharma appears well positioned to benefit from the broader biotech resurgence. After a brief downturn in November, the stock posted strong gains in January and February. Since then, it has traded tautly, digesting those earlier advances. Recently, Royalty broke out of that base, signaling potential for a continued move higher—possibly toward the mid-$40s by year-end. That would represent an upside of approximately 20% from current levels.