The odds are stacked against biotech investors. It typically takes at least 10 years and $500 million in funding to bring a new drug to market. Only about 10% of drugs promising enough to start clinical ­trials ever get FDA approval. For those that become blockbusters, however, the ­rewards can be enormous. In the three years that the hepatitis C drug Sovaldi went from late-stage development to $10 billion in annual sales, the stock price of its maker, biotech company Gilead Sciences, increased by more than 360%. For biotech investors, the key to moderating risk is diversification. My favorite biotech stocks with potential blockbuster drugs that might come to market within two to three years…

Isis Pharmaceuticals (ISIS) uses antisense technology, which inhibits the production of abnormal proteins in cells, reducing or delaying symptoms and damage. It is conducting clinical trials for FXI, a treatment to reduce risk for deep-vein thrombosis (blood clots) during major surgeries.

The Medicines Company (MDCO) provides treatments for critical-care patients in hospitals. It is awaiting FDA approval for Cangrelor, an antiplatelet, intravenous drug that helps prevent blood clots during cardiac stent ­procedures.

Ziopharm Oncology (ZIOP) is a gene-therapy company developing technology that reengineers a ­patient’s immune system so that it can target and destroy cancer cells while limiting damage to surrounding healthy cells. The firm’s most advanced product, Ad-RTS-IL-12, is being tested on breast cancer patients.