Small-Cap Pharma Stocks to Watch: Five NASDAQ Players Reshaping the 2026 Investment Landscape

The pharmaceutical sector is navigating a complex environment marked by regulatory pressures on drug pricing and shifting vaccine demand patterns. Yet beneath these near-term headwinds lies a structural tailwind: surging incidence of cancer and metabolic disorders continue driving therapeutic innovation globally. The US pharmaceutical market maintains its position as the epicenter of drug development, with 46 FDA approvals recorded in 2025 versus 50 in 2024. While mega-cap pharma companies typically dominate headlines, select small- and mid-cap entities on NASDAQ have delivered outsized returns this year. For investors seeking exposure to emerging pharmaceutical innovation, examining the performance of small cap pharma stocks with market capitalizations between US$50 million and US$500 million offers compelling opportunities.

Breaking Down This Year’s Small-Cap Pharma Winners

Our analysis of NASDAQ-listed small-cap pharma stocks, compiled using screening data from late December 2025, reveals meaningful divergence in performance. Five companies stand out for their clinical achievements and market recognition.

Galectin Therapeutics — The Fibrosis Treatment Pioneer (NASDAQ:GALT)

Delivering a remarkable 211.45% year-to-date advance, Galectin Therapeutics commands a market capitalization of US$263.08 million at a share price of US$4.08. The company’s therapeutic focus centers on chronic liver disease and oncology, with its lead compound belapectin representing a novel approach to inflammatory and fibrotic conditions through galectin-3 protein inhibition.

The headline achievement came from Phase 2b/3 trial results demonstrating belapectin’s ability to reduce new esophageal varices development and stabilize liver stiffness in metabolic dysfunction-associated steatohepatitis (MASH) cirrhosis patients with portal hypertension. These findings suggest potential disease-modifying activity in a space where therapeutic options remain limited. FDA fast-track designation underscores regulatory enthusiasm for the program. Following December 2025 FDA guidance, management indicated alignment on patient populations for upcoming registration studies, positioning Galectin to advance toward formal new drug application submission.

CytomX Therapeutics — Unlocking Localized Oncology Solutions (NASDAQ:CTMX)

Posting a 136.63% year-to-date gain, CytomX Therapeutics trades at US$2.38 per share with a US$375.74 million market cap. The clinical-stage biopharma specializes in tumor-targeted biologics leveraging its proprietary PROBODY platform, enabling production of localized therapies that minimize systemic toxicity in cancer treatment.

Strategic partnerships with Amgen, Bristol-Myers Squibb, Regeneron Pharmaceuticals, and Moderna amplify the company’s research capabilities. The pipeline progresses across multiple modalities: antibody-drug conjugates, T-cell engagers, and immune-stimulating cytokines. CX-2051, the lead candidate, demonstrated positive interim Phase 1 data in advanced colorectal cancer during Q1, with dose expansion cohorts anticipated to report in Q1 2026. Parallel development includes CX-801 combined with Merck’s Keytruda in metastatic melanoma, with translational data released in November. A separate Phase 1b trial combining CX-2051 with bevacizumab was scheduled for Q1 2026 initiation. The May 2025 capital raise of US$100 million provided runway to execute this ambitious clinical agenda.

Eton Pharmaceuticals — The Rare Disease Commercialization Story (NASDAQ:ETON)

Though posting a more modest 25.37% annual return, Eton Pharmaceuticals represents a different investment thesis, trading at US$16.80 with a US$450.53 million valuation. The Illinois-based company successfully transitioned from development-stage operations to commercial-stage execution, accumulating a portfolio of eight marketed orphan drugs plus five pipeline candidates.

The marquee achievement was KHINDIVI’s June 2025 launch—the first FDA-approved oral hydrocortisone solution for adrenocortical insufficiency in pediatric patients aged five and older (approved May 2025). Management pursues label expansion to younger age groups through bioequivalence studies commencing early 2026. Concurrent high-performing relaunches of Increlex (growth hormone therapy for IGF-1 deficiency) and Galzin (zinc supplementation for Wilson disease) demonstrated commercial execution capability. ET-600’s new drug application awaits FDA decision in late February, potentially adding a ninth marketed asset to the portfolio.

Fennec Pharmaceuticals — Pioneering Ototoxicity Prevention (NASDAQ:FENC)

Advancing 20.91% year-to-date, Fennec Pharmaceuticals maintains a US$262.54 million market cap at US$7.69 per share. The commercial-stage specialty pharma occupies a unique niche: preventing cisplatin-induced permanent hearing loss in pediatric cancer patients.

Pedmark stands as the sole FDA-approved therapy for this indication, establishing a defensible market position. 2025 proved transformational—the company achieved record revenue growth, eliminated corporate debt, and successfully penetrated international markets. Japanese Phase 2/3 data demonstrated significant hearing preservation rates, setting stage for global registration advancement in 2026. Management initiated its first adult market expansion through a metastatic testicular cancer trial, signaling confidence in Pedmark’s broader applicability beyond pediatric oncology.

Zevra Therapeutics — Rare Metabolic Disease Focus (NASDAQ:ZVRA)

Posting the most modest return at 5.25% year-to-date, Zevra Therapeutics trades at US$8.82 with a US$496.54 million market cap. The former KemPharm (rebranded 2023) pivoted toward ultra-rare pediatric and metabolic disorders via data-driven development strategies.

Miplyffa, approved by FDA in 2024 for Niemann-Pick disease type C when combined with miglustat, emerged as the commercial cornerstone. December 2025 brought strategic distribution alignment with Uniphar, extending Miplyffa availability across international territories outside the US and Europe. Q3 2025 results underscored this momentum: revenue surged 605% year-over-year, predominantly attributable to Miplyffa’s early market adoption.

Key Takeaway for Small Cap Pharma Stocks Investors

These five small-cap pharma stocks illustrate the innovation-driven returns available from specialized biopharma entities pursuing high-unmet-need indications. Success metrics span clinical achievement (Galectin’s MASH data), commercial execution (Eton’s multi-product launch cadence), capital efficiency (Fennec’s debt elimination), and global expansion (Zevra’s distribution partnerships). Investors evaluating small cap pharma stocks lists should weigh regulatory pathway alignment, cash runway, and competitive positioning when constructing positions in this dynamic sector.