Incyte Corporation (INCY)

The main drug suppresses the signalling pathway that makes bone marrow produce cells incorrectly. It remains the standard of care and supplies the overwhelming share of revenue. That dependence is both a strength and a vulnerability: patent protection has an end date, and the cliff is visible in the calendar well in advance.

A replacement is sought in two directions: a cream for vitiligo and eczema working through the same mechanism, and drugs against particular tumour types. The company is profitable, which is rare for a biotech, and reinvests that profit into development. Risks: the patent term, trial outcomes and insurers' decisions on covering an expensive cream. The company pays no dividend.