Look at this afternoon’s top gainers.

One of them mines iron ore. Oddly enough, its ticker isn’t IRON. Its ticker is CLF.

IRON is a biotech. So is the rest of the list.

Biotech. Biotech. More biotech. Again.

After a strong year, some analysts have declared the industry finished. These stocks didn’t get the memo.

Today, let’s talk about what the memo missed… and why, for some investors, the best gains are still to come.

89 Stocks… In One Day

August 19. Moderna, a COVID-era darling that had sputtered for years, soared as much as 176% in a single session. That same day, about 89 biotech stocks hit new 52-week highs. One day.

Then, on August 21, Werewolf Therapeutics, a stock trading under a dollar, more than doubled on a merger deal.

September 28. Kodiak Sciences gapped up as much as 178%. Its eye drugs went toe-to-toe with Regeneron’s Eylea, a multibillion-dollar blockbuster, in Phase 3.

October 5? Vaxcyte popped 31% on Phase 3 vaccine data.

Then there’s Definium Therapeutics.

In spring 2025, it traded as low as $4.70. Lately, it’s been in the mid-30s. That’s more than 500% in 18 months. The company plans to file for FDA approval in the first half of 2027.

Something has shifted.

Biotech’s Milkshake Moment

For years, money fled biotech. The XBI, the main small-biotech index, fell from $168 in early 2021 to $64 three years ago.

Now it’s back.

2026 is on pace to be the second-busiest year for biopharma M&A in recorded history. About $241 billion annualized. 2027 could be even bigger.

Meanwhile, Big Pharma faces a $300 billion patent cliff over the next five years. Its own pipelines can’t fill the hole fast enough. So it’s buying. In July, Vertex paid $10 billion for Crinetics at a premium of more than 100%. Vertex was the only bidder.

No auction. No bidding war. Still double.

In There Will Be Blood, Daniel Day-Lewis drinks his rival's milkshake. Big Pharma is pulling out the straws. And it has a $300 billion thirst.

Now add AI.

AI is Accelerating

Drug discovery has always been slow, expensive and mostly a failure. AI attacks all three.

Design the molecule. Test it in the (self-driving) lab. Feed the results back to the model. Repeat A thousand times. Faster than a floor full of chemists could do it once.

The market has noticed the potential.

AbCellera, an AI-driven antibody shop, is up about 300% this year. Absci, which designs drugs with generative AI, is up about 217%. Eli Lilly put $40 million into Absci’s last raise.

Estimates for the AI drug discovery market today run as low as a few billion dollars. The most aggressive forecast puts it at $160 billion by 2035.

That’s the setup for a supercycle.

A sector starved of capital for years. Buyers who have to buy. A technology that makes the product cheaper to build.

The 1-Day Windfalls

Our Paradigm colleague Ray Blanco has a name for moves like these.

He calls it the 1-Day Windfall. A tiny biotech. One announcement. A stock that can double—or more—between breakfast and dinner.

Ray leads our biotech research team. And he’s recently spotted a tiny company flashing all three of his signals. He wants our readers positioned by Friday.

Tomorrow, he’ll show you how. Stay tuned for tomorrow’s Altucher Confidential.

There will be windfalls.