• support@madhedgefundtrader.com
  • Member Login
Mad Hedge Fund Trader
  • Home
  • About
  • Store
  • Luncheons
  • Testimonials
  • Contact Us
  • Click to open the search input field Click to open the search input field Search
  • Menu Menu
april@madhedgefundtrader.com

From Petri Dish To Personalized Prescriptions

Biotech Letter

Remember the last time you had to pop a pill that felt like a one-size-fits-all solution? I sure do. It was for a nagging cough, and while it did the trick, the side effects left me feeling like I'd been hit by a truck.

Turns out, Big Pharma is facing its own kind of side effects. They spend an average of $2.6 billion and over a decade to bring a new drug to market. That's like betting on a long shot at the Kentucky Derby, but with way worse odds.

But what if we could change the game entirely? What if drug discovery wouldn’t solely be about blindly mixing chemicals and hoping for the best.

Instead, picture a super-smart robot scientist, capable of reading millions of pages of medical research in seconds, understanding how different molecules interact, and even predicting which ones might be effective against a disease.

This AI-powered scientist could then design experiments to test those molecules, analyze the results, and even create new molecules from scratch, tailored to specific diseases and individual patients.

That's the promise of autonomous drug discovery.

While we've already seen robots and miniaturization speed up the drug discovery process, AI is taking it to the next level. I’m talking about AI agents running the entire show, from brainstorming biological theories to designing and running experiments, all with barely a human finger lift.

This isn't just about efficiency. It's a veritable gold mine of benefits: costs slashed, development times cut down, success rates skyrocketing, and a productivity boost that could revolutionize personalized medicine. And why does that matter?

Because it means treatments that are more effective, safer, and tailored to your unique genetic makeup, medical history, and lifestyle. Imagine popping a pill that's not just designed to treat your disease, but designed specifically for you. That's the kind of future autonomous drug discovery could deliver.

Imagine a world where your next prescription is fine-tuned to your genetic makeup, your medical history, your lifestyle. Sounds like bespoke tailoring, but for your health.

And this isn't just hype – it's backed by hard numbers. A recent study by McKinsey & Company found that AI-enabled drug discovery could potentially generate up to $50 billion in annual value by 2026.

The study also highlighted that AI could reduce the time required for drug discovery by up to 50%, while also improving the success rate of clinical trials.

These aren’t merely some abstract predictions either. In fact, some companies are already making waves in this new world of drug discovery.

Recursion Pharmaceuticals (RXRX), for example, is at the forefront of these innovations. They've developed a radical new drug discovery platform that combines advanced robotics, experimental biology, and machine learning to rapidly identify potential new treatments for a wide range of diseases.

Forget dusty labs and slow, painstaking research. Recursion's approach is like giving Sherlock Holmes a supercomputer to solve medical mysteries, and the results speak for themselves: over 2,000 novel biological relationships discovered and a mind-boggling 150 terabytes of relatable biological data generated.

That's the equivalent of roughly 30 million songs, all focused on cracking the code of human biology and disease.

Recursion isn't the only player here. A slew of innovative companies are riding the AI wave, reimagining the drug discovery landscape.

Schrödinger (SDGR) is turbocharging the process with AI and computational wizardry, using algorithms to predict how potential drugs will behave in the body before even stepping foot in a lab.

Relay Therapeutics (RLAY) is forging new paths by marrying cutting-edge computation with experimental techniques, focusing on how cancer cells move and change shape to develop targeted therapies.

Exscientia (EXAI), the AI-driven pharmatech company, is designing and discovering new drugs with unprecedented speed, while AbCellera Biologics (ABCL) is harnessing the power of AI and machine learning to decode the secrets of our immune systems, hunting for antibodies that could be developed into life-saving drugs. It’s basically like having a crack team of digital detectives scouring your immune system for clues to fight off diseases.

Meanwhile, BenevolentAI (AMS: BAI) is the top name when it comes to clinical-stage AI drug discovery, using a potent combination of AI, machine learning, and cutting-edge science to unravel the complexities of disease biology and unearth novel treatments. They're not simply content with throwing darts at a target. This company is using AI to pinpoint the bullseye.

But, this AI-powered revolution of the healthcare world isn't happening in a vacuum. It's being supercharged by a tag team of tech titans who are bringing their AI firepower to the table.

Think of it as the Avengers assembling to fight disease, but instead of superpowers, they're armed with algorithms and cloud computing.

Nvidia Corporation (NVDA), IBM Corporation (IBM), and Microsoft Corporation (MSFT) are leading the charge, providing the AI muscle needed to accelerate drug discovery.

Nvidia's Clara Discovery platform, IBM Watson Health, and Microsoft Azure's AI and machine learning services are all being harnessed to build, train, and deploy AI models for a wide range of applications in the biotech and healthcare sectors. It's like having Tony Stark, Bruce Banner, and Thor all working together to create the next medical breakthrough.

And this isn't some wishful thinking. The use of AI in biopharma R&D is projected to skyrocket, growing at a compound annual growth rate of 30% to 40% over the next five years.

Plus, the impact could be huge: AI could potentially boost clinical trial efficiency by 15% to 20% and slash the overall cost of drug development by 10% to 15%. Talk about a win-win situation.

All in all, it’s clear that this AI drug discovery thing isn't just a fad. It's a full-blown revolution that's shaking up the healthcare world as we know it. And while it's still in the early innings, it would be wise to keep a close eye on it. I'm not saying you should throw all your money in right this second, but seriously, put the companies above on your radar.

These are the trailblazers leading the charge into the future of personalized medicine. Who knows, they might just be the ticket to a healthier portfolio—and a healthier you.

 

 

 

 

 

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 april@madhedgefundtrader.com https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png april@madhedgefundtrader.com2024-06-04 12:00:562024-06-04 12:21:21From Petri Dish To Personalized Prescriptions
april@madhedgefundtrader.com

May 30, 2024

Biotech Letter

Mad Hedge Biotech and Healthcare Letter
May 30, 2024
Fiat Lux

 

Featured Trade:

“SCALING THE CLIFF”

(PFE), (BMY)

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 april@madhedgefundtrader.com https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png april@madhedgefundtrader.com2024-05-30 12:02:282024-05-30 11:33:18May 30, 2024
april@madhedgefundtrader.com

Scaling The Cliff

Biotech Letter

Bob Dylan was right: "The times they are a-changin'". And for Pfizer (PFE), those changing times mean navigating a post-pandemic world and a looming patent cliff. Can they rise to the challenge, or will they be singing the blues?

Pfizer hardly needs an introduction. Founded 175 years ago in 1849 and publicly listed in 1942, Pfizer boasts a market cap of over $160 billion, with highly liquid options trading against its equity.

However, this stock has been on a bit of a rollercoaster lately.

With revenues exceeding $240 billion between 2021 and 2023, largely from vaccines and cancer treatments sold in over 200 countries, Pfizer's reach is undeniable.

But after hitting a record high of $61.71 a share in December 2021, it's taken a nosedive – more than a 50% drop.

So, what gives? Well, it's mostly a combo of waning demand for their Covid-19 products and the dreaded patent cliff looming over some of their top-selling drugs.

At the moment, Pfizer's portfolio paints a mixed picture, with some drugs shining brightly and others facing a cloudier future.

Their pneumonia vaccine duo, Prevnar 13 and 20, remains a reliable workhorse, raking in $6.4 billion in FY23, a 3% increase. With Prevnar 20's patent secure until 2033, it's a safe bet for continued success.

Eliquis, the blood thinner co-marketed with Bristol-Myers Squibb (BMY), is also holding its own, bringing in a respectable $6.7 billion in FY23, up 5%. However, the looming threat of generic competition in 2028 could put a damper on its future prospects. 

On the other hand, Vyndaqel, a combination heart and nerve drug, has been a true standout, boasting a remarkable 36% jump in revenue to $3.3 billion in FY23.

Doctors have embraced it for treating a heart condition called ATTR-CM, but its patent situation remains uncertain with a potential expiration in 2024, unless Pfizer's extension to 2028 is approved.

Not all is rosy in Pfizer's garden though.

Comirnaty, their COVID-19 vaccine, may still be pulling in a hefty $11.2 billion in FY23, but it's a far cry from its FY22 peak. Sales have plummeted 70%, and those booster shots aren't exactly flying off the shelves anymore.

As for Paxlovid, the once-promising COVID-19 treatment, this drug has suffered an even more dramatic fall from grace, with revenue crashing 92% to $1.3 billion in FY23. To add insult to injury, Uncle Sam returned a staggering 6.5 million treatment courses.

Meanwhile, Ibrance, their breast cancer treatment, is also feeling the heat, with sales down 6% to $4.8 billion in FY23. It's facing tough competition overseas and its patent is set to expire in 2027, adding further pressure on its future performance.

To make matters worse, several other Pfizer blockbusters – Inlyta, Xeljanz, and Xtandi – are also staring down the barrel of patent expiration in the next few years.

This looming patent cliff poses a significant challenge for Pfizer, as these drugs have been major contributors to their revenue stream.

The company will need to rely on its pipeline of new drugs and strategic acquisitions to offset the potential losses and maintain its position as a leading player in the pharmaceutical industry.

Does that mean, then, that the $43 billion Seagen acquisition in December 2023 could become a lifeline for Pfizer?

Facing a double whammy of declining blockbuster sales and the looming patent cliff, Pfizer isn't sitting idly by. Seagen brings a fresh arsenal of patent-protected cancer-fighting drugs to the table, including three promising antibody-drug conjugates (ADCs).

Two of these, Adcetris for Hodgkin lymphoma and Padcev for urothelial cancer are already showing blockbuster potential, having raked in $751 million and $479 million, respectively, in the first nine months of 2023, despite the acquisition's timing.

But Pfizer's ambition doesn't stop there.

With five new therapies and six label expansions slated for oncology alone by 2026, they're banking on biologics like ADCs to fuel their growth.

They predict these cutting-edge treatments will surge from 6% to 60% of their cancer revenues by 2030, potentially yielding eight new blockbusters.

For now, Seagen's arrival is a much-needed boost to their oncology sales, which dipped 4% to $11.6 billion in FY23, even with Seagen's $120 million contribution in the final weeks of the year.

While the Seagen acquisition helps Pfizer tackle its goals of dominating oncology and fueling pipeline innovation, it's not the whole picture.

Pfizer's got a few other tricks up its sleeve: maximizing new product performance, trimming costs, and playing the capital allocation game to keep shareholders happy.

They're even planning a $3 billion spending spree from late 2023 through 2024, aiming for a cool $4 billion in annual cost savings. Talk about tightening the belt while expanding the empire.

Speaking of empires, Pfizer's 4Q23 results were a bit of a wake-up call.

Earnings per share (EPS) tanked to $0.10 (non-GAAP) on revenue of $14.2 billion, a far cry from the $1.14 EPS and $24.3 billion revenue of the previous year.

For the full year, EPS dropped a whopping 72% to $1.84 (non-GAAP), with revenue down 42% to $58.5 billion.

But, if you ignore those pesky Covid-19 products (Comirnaty and Paxlovid), the top line actually grew a bit – 8% in Q4 and 7% for the whole year.

Just remember, that Paxlovid revenue reversal in Q4 wasn't pretty, slashing both GAAP and non-GAAP EPS by $0.54.

Fast forward to Q1 2024, and Pfizer's numbers were a bit more cheerful, at least compared to what the analysts expected.

Non-GAAP EPS came in at 82 cents, a solid 30 cents above the consensus.

Revenue did fall 19.5% year-over-year to $14.9 billion, but even that beat estimates by $900 million.

Management's still sticking to their FY2024 guidance of $58.5 billion to $61.5 billion in revenue and $2.15 to $2.35 in non-GAAP EPS. We'll see if they can deliver.

That Seagen deal wasn't cheap, though, adding a hefty $31 billion to Pfizer's debt pile. As of March, they had about $12 billion in cash and marketable securities against over $61 billion in long-term debt. Yikes.

Still, management's determined to keep raising those quarterly dividends, now up to $0.42 a share in early 2024. That's a lot, considering it ate up 91% of their non-GAAP earnings in FY23 and is projected to gobble 78% in FY24.

With all that debt, don't expect any more stock buybacks in 2024. Pfizer's taking a break from that game, just like they did last year.

Despite Wall Street's lukewarm reception to Pfizer's patent cliff strategy, it's important to remember that this pharmaceutical giant is far from down for the count.

So, sure, Pfizer's 2023 revenue took a 42% nosedive compared to 2022, but let's not forget: over 620 million people worldwide still rely on their meds. 

They actually scored nine FDA approvals, sold more pharmaceuticals than anyone else on the planet, and they're not sitting idly by while their product sales decline. Clearly, they're making moves.

The current bargain-basement price of Pfizer's stock, trading at a P/E of 10.4 on FY25E EPS, coupled with a juicy 5.9% yield, might just be the cherry on top for savvy investors willing to bet on the company's ability to navigate these turbulent times. Whether they can pull it off is anyone's guess, but at this price, it might be worth a gamble.

 

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 april@madhedgefundtrader.com https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png april@madhedgefundtrader.com2024-05-30 12:00:302024-05-30 11:33:31Scaling The Cliff
april@madhedgefundtrader.com

May 28, 2024

Biotech Letter

Mad Hedge Biotech and Healthcare Letter
May 28, 2024
Fiat Lux

 

Featured Trade:

(GET YOUR GEIGER COUNTERS READY)

(NVS), (LLY), (BMY), (AZN)

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 april@madhedgefundtrader.com https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png april@madhedgefundtrader.com2024-05-28 12:02:552024-05-28 12:00:05May 28, 2024
april@madhedgefundtrader.com

Get Your Geiger Counters Ready

Biotech Letter

Hang on to your Geiger counters because we're about to dive deep into the world of radiopharmaceutical therapy. I bet even Marie Curie would be impressed by the mind-blowing leaps we've made since her ground-shattering discoveries a century ago.

Now, don't get me wrong, she's a tough act to follow. But the big guns in pharma have taken up the challenge, piling up billions on the roulette table of targeted radiopharmaceutical therapy.

And from where I'm sitting, the odds are looking pretty darn exciting.

Just picture the scene: Radiation that directly takes the fight to those nasty tumor cells, like a microscopic missile strike that zaps cancer cells while ignoring the innocent bystanders.

How? By hitching a radioactive particle to a targeting molecule - think Uber, but for cancer therapy.

This healthcare game-changer, dubbed radiopharmaceutical therapy is projected to become a whopping $25 billion goldmine.

Forget the clunky radiation therapy your grandparents endured – this is precision, it's innovation, and it could potentially enrich your investment portfolio.

Actually, everyone seems to be piling into the radiopharma race. Experts say we're merely at the start line and these next-gen technologies could bring a windfall.

Evidence? The recent flurry of acquisitions, with no less than four deals being sealed just these past months.

Now, let's put some names to this game.

Novartis (NVS) is leading the pack with two radiopharmaceutical showstoppers under its belt. With their drugs Pluvicto and Lutathera, they're forecasted to rake in a whopping $5 billion by 2028 – that's more zeros than I can count on two hands.

Not just resting on their pile of success, they've scooped up Mariana Oncology in a $1 billion deal. This strategic move solidifies Novartis' dominion in the radiopharmaceutical arena – and you can quote me on that.

Inspired by Novartis' success, other pharmaceutical titans are catching the FOMO fever.

Eli Lilly (LLY), for instance, handed over $1.4 billion to acquire Point Biopharma and its promising radiation drug, PNT2002.

The investors’ darling this year with a near 38% surge in stock price (thanks to the overwhelming success of its obesity drugs), Eli Lilly is set to maintain its upward trajectory by venturing into the radiopharmaceutical space.

Bristol-Myers Squibb (BMY) isn't about to be left out of the radiopharmaceutical race either.

They ponied up a cool $4.1 billion for RayzeBio, snagging a promising pipeline of treatments. One standout is RYZ101, a late-stage targeted radiopharma therapy already making waves in trials for gastroenteropancreatic neuroendocrine tumors and small-cell lung cancer.

This acquisition followed closely on the heels of their $14 billion buyout of schizophrenia drug developer Karuna Therapeutics. Clearly, they’re feeling the heat as patents on some of their older cash cows are set to expire.

So, sure, BMY’s stock has been a bit sluggish lately, but this radiopharmaceutical gamble could be the shot in the arm they need.

And the acquisition spree doesn't stop there. AstraZeneca (AZN) also dove headfirst into the radiopharmaceutical pool, shelling out $2.4 billion for Fusion Pharmaceuticals in March.

Fusion's pipeline, including their Phase 2 candidate FPI-2265 for metastatic castration-resistant prostate cancer, adds another potential blockbuster to the mix.

Meanwhile, several biopharma companies are still standing tall, catching the eye of investors.

In fact, the venture capital poured into radiopharmaceutical drugs surged to $518 million last year, a cool 722% increase from 2017.

The race isn't slowing down anytime soon either. Researchers are exploring the use of radiopharmaceuticals alongside other treatments like immunotherapy, and even envision a future where this technology could be applied to any cancer, including ovarian, breast, or brain tumors.

And with only two products currently in the market, the potential for growth in targeted radiotherapies seems almost infinite.

So, I'll say it one more time – get your Geiger counters ready. The radiopharmaceutical revolution is just getting started, ladies and gentlemen. It’s time to zero in on this hotbed of innovation and watch your investments go nuclear.

 

 

 

 

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 april@madhedgefundtrader.com https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png april@madhedgefundtrader.com2024-05-28 12:00:522024-05-28 11:59:05Get Your Geiger Counters Ready
april@madhedgefundtrader.com

May 23, 2024

Biotech Letter

Mad Hedge Biotech and Healthcare Letter
May 23, 2024
Fiat Lux

 

Featured Trade:

(A DIVIDEND DERBY WINNER)

(ABT)

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 april@madhedgefundtrader.com https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png april@madhedgefundtrader.com2024-05-23 12:02:312024-05-23 12:03:25May 23, 2024
april@madhedgefundtrader.com

A Dividend Derby Winner

Biotech Letter

When you're at a racetrack, eyeing the horses before the big race, you're not just looking for a quick win. You want a stallion that'll keep delivering, race after race.

Well, that's exactly what we're hunting for in the stock market – companies that can keep those dividend payouts growing year after year. And if there's one thoroughbred you won't want to miss, it's Abbott Laboratories (ABT).

This biotech and healthcare giant isn't just keeping pace; it's setting the darned pace. Abbott is dominating the medical devices arena, a sector projected to skyrocket from $518.5 billion in 2023 to a whopping $886.8 billion by 2032. That's a steady 6.3% annual growth rate.

However, Abbott's not content with just one race – they've got their fingers in the lucrative pies of diagnostics and nutritional products, too.

But hold your horses, partner. Abbott isn't some one-trick pony. They've got their fingers in the lucrative pies of diagnostics and nutritional products too. Earlier this year, I gave this stock a thumbs-up, and it's only become more of a hot ticket since.

Fresh off their first-quarter reveal in April, Abbott's core business – think medical devices, diagnostics, and even baby formula – grew organically by an impressive 10.8% year-over-year.

This marks the fifth consecutive quarter of double-digit growth, so we're not just talking about a lucky streak here.

From what I can see, their Medical Devices segment is the real workhorse, surging 14.2% over the previous year. Their FreeStyle Libre device isn't just flying off the shelves, it's practically teleporting, with sales up 23% from last year. And with the FDA's recent green light for innovative products like TriClip and Amulet, Abbott isn't just playing in the major leagues, they're calling the shots.

Their Nutrition sector wasn't a slouch either, pulling in $2.1 billion in sales, a 5.1% increase over last year. Abbott's new Protality shake, launched in January, is specifically designed for those on weight loss journeys, adding another feather to their growth cap. Needless

Even their Diagnostics segment, which saw a dip due to the waning of COVID-19 testing, showed underlying strength in non-COVID testing. Their recent clearance for a concussion diagnostic test proves they're not slowing down on the innovation front.

When it comes to financials, Abbott is built like a brick house. With rock-solid interest coverage and debt servicing capacity, it's no wonder analysts are predicting a steady climb in their earnings. They've got a pipeline of new products and a market that's bouncing back from the pandemic, creating a recipe for success.

And don't even get me started on the dividends. Sure, Abbott's 2.1% yield might seem modest, but it's the growth story that's truly captivating.

Over the past decade, they've seen a staggering 11.4% annual growth in dividends. This ain't no stagnant stock, folks; it's a purebred built for speed.

Of course, no investment is without its bucking broncos. Abbott's still wrestling with the drop-off in pandemic-related revenues, and while their R&D spending is admirable, there's no guarantee those investments will always pay off. And let's not forget the ever-present threat of cyberattacks—a risk for any big player in today's world.

Still, while there might be a few hurdles in the race, Abbott Laboratories is a thoroughbred built for the long haul. With a rock-solid balance sheet, a track record of innovation, and a dividend that's been growing faster than a foal in springtime, this is a stock that's hard to beat.

And right now, the odds are in your favor. This company’s shares have been trading at a discount. So if you're ready to saddle up with a dividend growth thoroughbred, it's time to consider adding Abbott Laboratories to your stable. Because when it comes to the dividend derby, this is one horse you'll want to back.

 

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 april@madhedgefundtrader.com https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png april@madhedgefundtrader.com2024-05-23 12:00:412024-05-23 12:03:03A Dividend Derby Winner
april@madhedgefundtrader.com

May 21, 2024

Biotech Letter

Mad Hedge Biotech and Healthcare Letter
May 21, 2024
Fiat Lux

 

Featured Trade:

(THE FAT’S IN THE FIRE)

(RHHBY), (LLY), (NVO), (AMGN), (VKTX), (PFE), (MRK), (SNY), (ABT)

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 april@madhedgefundtrader.com https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png april@madhedgefundtrader.com2024-05-21 12:02:412024-05-21 12:22:07May 21, 2024
april@madhedgefundtrader.com

The Fat's In The Fire

Biotech Letter

Well, well, well, look who's decided to crash the obesity-drug party. Roche (RHHBY), the Swiss pharmaceutical giant, has just unveiled some pretty impressive early-stage results for its weight-loss drug, CT-388. And let me tell you, this could be the start of something big.

Now, I know what you're thinking: "Another weight-loss drug? Yawn." But trust me, this is no ordinary contender.

In a small trial, patients who received CT-388 saw an average placebo-adjusted weight loss of 18.8% after just 24 weeks. That's right, 18.8%.

While it's hard to compare trials, experts are saying these numbers might even give Eli Lilly's (LLY) Zepbound, the current king of the market, a run for its money.

Let's take a step back and look at the bigger picture. The obesity drug market has been on fire lately, with everyone going gaga over these miracle pills.

Lilly and Novo Nordisk (NVO) have been dominating the scene with their drugs, Zepbound and Wegovy, but that hasn't stopped a whole host of other companies from trying to get a piece of the pie.

Merck (MRK), Sanofi (SNY), Abbott Labs (ABT), and Eisai have all tried their hand at weight-loss drugs and ultimately thrown in the towel.

More recently, Pfizer's (PFE) daily oral pill, danuglipron, has faced hurdles due to side effects. Amgen's (AMGN) drug, MariTide, is in Phase 2 studies and showing promise. And let's not forget Viking Therapeutics' (VKTX) VK2735, which has earned the nickname "twincretin" for its dual targeting of GLP-1 and GIP receptors.

So, what makes Roche's CT-388 so special?

Well, for starters, it's a GLP-1/GIP receptor agonist, which is similar to Lilly's Zepbound. In the Phase 1 trial, all participants achieved more than 5% weight loss, with 85% losing more than 10%, 70% shedding more than 15%, and a whopping 45% dropping more than 20% of their body weight. That's some serious weight loss.

Of course, there were some side effects, mainly mild to moderate gastrointestinal issues, but hey, that's the price you pay for looking fabulous, right? Roche is also testing CT-388 in patients with Type 2 diabetes, so stay tuned for updates on that front.

Now, I know you're all dying to know how CT-388 stacks up against the competition.

Notably, the drug's data looks strong compared to earlier studies of Zepbound. In fact, CT-388's efficacy results appeared "numerically higher" than Zepbound's.

But let's not get ahead of ourselves. Lilly still has a multi-year lead on Roche, so CT-388 isn't an immediate threat. However, it does suggest that the future of this rapidly growing market is up for grabs.

Now, let's talk about Roche. It’s the world's seventh-largest pharma company by market cap, sitting at around $205 billion. They pulled in $65 billion in revenue in 2023, second only to Johnson & Johnson (JNJ).

But here's the kicker—they've been struggling with growth, and their share price has taken a hit, down more than 25% over the past three years.

Contrast that with Eli Lilly and Novo Nordisk. Lilly's share price shot up 290% in three years, and Novo's climbed 226%.

Even though their revenues were less than half of Roche's in 2023, their market caps are sky-high. Why? Because of their blockbuster GLP-1 agonist drugs, Zepbound and Wegovy, which have shown jaw-dropping weight-loss results.

But could CT-388 be the underdog story Roche needs?

With the obesity market estimated to reach a staggering $100 billion by 2030, and over 1 billion people worldwide suffering from obesity, the potential is enormous.

Of course, there's still a long way to go for CT-388. Cross-trial comparisons can be tricky, and Roche's Phase 1 trial was much smaller than Lilly's pivotal study of Zepbound.

Plus, we don't have all the juicy details on patient characteristics, dose titration, and long-term weight loss just yet.

But here's the thing: Roche has scale and infrastructure on its side. It could potentially outmuscle smaller players like Viking and Boehringer Ingelheim.

And if CT-388 can match or even surpass the performance of current and future GLP-1 agonists? Well, let's just say those peak revenue forecasts might be in for a surprise.

So, is Roche the dark horse you should bet on in the obesity-drug race? If you're looking to get in on the action without paying the premium commanded by Lilly and Novo, or taking on the higher risk of smaller players, Roche might just be the ticket.

With promising mid-single-digit revenue growth on the horizon and a strong position in other areas like oncology and autoimmune disorders, Roche could be a smart play for anyone keen on the obesity drug market.

As for me? Well, you know I love an underdog story. And CT-388 might just be the Cinderella story of the year. I suggest you buy the dip.

 

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 april@madhedgefundtrader.com https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png april@madhedgefundtrader.com2024-05-21 12:00:422024-05-21 12:21:44The Fat's In The Fire
april@madhedgefundtrader.com

May 16, 2024

Biotech Letter

Mad Hedge Biotech and Healthcare Letter
May 16, 2024
Fiat Lux

 

Featured Trade:

(THE COMEBACK KID OF VACCINES)

(NVAX), (SNY), (BNTX), (PFE)

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 april@madhedgefundtrader.com https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png april@madhedgefundtrader.com2024-05-16 12:02:252024-05-16 11:38:20May 16, 2024
Page 20 of 114«‹1819202122›»

tastytrade, Inc. (“tastytrade”) has entered into a Marketing Agreement with Mad Hedge Fund Trader (“Marketing Agent”) whereby tastytrade pays compensation to Marketing Agent to recommend tastytrade’s brokerage services. The existence of this Marketing Agreement should not be deemed as an endorsement or recommendation of Marketing Agent by tastytrade and/or any of its affiliated companies. Neither tastytrade nor any of its affiliated companies is responsible for the privacy practices of Marketing Agent or this website. tastytrade does not warrant the accuracy or content of the products or services offered by Marketing Agent or this website. Marketing Agent is independent and is not an affiliate of tastytrade. 

Legal Disclaimer

There is a very high degree of risk involved in trading. Past results are not indicative of future returns. MadHedgeFundTrader.com and all individuals affiliated with this site assume no responsibilities for your trading and investment results. The indicators, strategies, columns, articles and all other features are for educational purposes only and should not be construed as investment advice. Information for futures trading observations are obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. Your use of the trading observations is entirely at your own risk and it is your sole responsibility to evaluate the accuracy, completeness and usefulness of the information. You must assess the risk of any trade with your broker and make your own independent decisions regarding any securities mentioned herein. Affiliates of MadHedgeFundTrader.com may have a position or effect transactions in the securities described herein (or options thereon) and/or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies.

Copyright © 2025. Mad Hedge Fund Trader. All Rights Reserved. support@madhedgefundtrader.com
  • Privacy Policy
  • Disclaimer
  • FAQ
Scroll to top