Hims-Eli Lilly GLP-1 Deal Meets Summit’s FDA Gamble: Which Biotech ETFs Stand to Gain?

By Chandrima Sanyal

Biotech ETFs face a pivotal week as Summit Therapeutics (NASDAQ:SMMT)/a> approaches a key FDA decision, while fresh drug-development updates and Hims & Hers Health Inc (NYSE:HIMS)/a> partnership with Eli Lilly And Co (NYSE:LLY)/a> put healthcare's growth prospects in focus.

Healthcare stocks have shown resilience amid the broader market selloff. The Health Care Select Sector SPDR Fund (NYSE:XLV)/a> slipped just 0.04% last week, while the iShares Biotechnology ETF (NASDAQ:IBB)/a> fell 1.8% and the SPDR S&P Biotech ETF (NYSE:XBI)/a> lost 2.4%.

All three outperformed the SPDR S&P 500 ETF Trust (NYSE:SPY)/a>, down 2.7%, and the Invesco QQQ Trust (NASDAQ:QQQ)/a>, which declined nearly 5%./p> div class="bz-read-next-block" data-variant="card" data-news-mode="manual" >

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Summit's FDA Decision Tests Biotech Sentiment

On Nov. 14, Summit Therapeutics faces an FDA decision on ivonescimab combined with chemotherapy for patients with advanced EGFR-mutated non-small cell lung cancer.

The Phase 3 HARMONi trial met its progression-free survival goal, but its primary overall-survival analysis initially missed statistical significance. Subsequent follow-up showed a nominal survival benefit, with a hazard ratio of 0.76 and a nominal p-value of 0.0151.

The FDA had previously indicated that statistically significant overall-survival improvement was necessary to support approval, making the decision particularly consequential.

TG Therapeutics Inc's (NASDAQ:TGTX)/a> Briumvi sales and Arrowhead Pharmaceuticals' (NASDAQ:ARWR)/a> latest clinical data add further catalysts for biotech investors. TG Therapeutics reported Q3 Briumvi U.S. net product revenue of $232.6 million, up 52% year over year, while Arrowhead Pharmaceuticals presented pooled Phase 3 data showing plozasiran reduced acute pancreatitis event rates by 78% versus placebo.

XLV, IBB Or XBI: Which ETF Offers Better Exposure?

The distinction between these ETFs matters for investors positioning around the week's catalysts.

XLV offers the clearest GLP-1 exposure. Eli Lilly represents 16.17% of its portfolio, making it the most direct way among these three funds to gain exposure to Lilly's obesity-drug business. Johnson & Johnson (NYSE:JNJ)/a> and AbbVie (NYSE:ABBV) are other major holdings. Its expense ratio is just 0.08%.

IBB targets established biotech leaders. Gilead Sciences, Inc (NYSE:GILD)/a> (8.9%), Amgen Inc (NYSE:AMGN)/a> (8.36%), Vertex Pharmaceuticals Inc (NASDAQ:VRTX)/a> (7.84%) and Regeneron Pharmaceuticals Inc (NASDAQ:REGN)/a> (6.19%) are its largest holdings. With a 0.44% expense ratio, it offers exposure to commercialized biotech businesses and drug pipelines.

XBI offers broader exposure to smaller biotech companies. Its modified equal-weighting approach limits concentration, with Moderna Inc (NASDAQ:MRNA)/a> representing 2.79% and Spyre Therapeutics Inc (NASDAQ:SYRE)/a> 1.77% of assets. Its 0.35% expense ratio is below IBB's. This structure offers greater exposure to individual clinical and regulatory catalysts, but also company-specific risks.

For investors focused on Lilly and GLP-1 growth, XLV stands out. IBB suits those seeking established biotech exposure, while XBI offers a broader, higher-risk bet on drug-development breakthroughs./p> div class="bz-read-next-block" data-variant="card" data-news-mode="manual" >

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