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Mad Hedge Fund Trader

Can CRISPR Stop the Silent Killer?

Biotech Letter

Obesity has virtually tripled worldwide since 1975.

In 2019 alone, the World Health Organization classified 38 million children under 5 years old as overweight or obese.

More alarmingly, obesity has been dubbed as the “silent killer” because it is one of the leading factors that cause premature deaths.

In 2017, 4.7 million or 8% of global deaths were linked to this condition.

For context, the number of deaths caused by obesity is 4 times the fatality rate from road accidents and almost 5 times the number of those who died from HIV/AIDS.

Right now, 39% of adults across the globe are considered overweight and 13% are obese.

By 2030, nearly half the adult population of the United States is expected to be suffering from obesity.

Now, we might have the answer to this “silent killer:” CRISPR gene editing.

A recent Harvard study showed that CRISPR gene editing can be used to engineer cells to avoid weight gain and even potentially stop the onset of obesity-related diseases like diabetes.

The solution is straightforward.

The scientists will convert the body’s white fat, which is the “bad fat,” into brown fat or the "good fat.”

Brown fat is known as the healthy fat because it produces heat for the body by burning calories. Meanwhile, white fat tends to build up and leads to obesity.

Through CRISPR gene editing, the white fat is transformed into brown fat. This will then be burned by the body and used as an energy source, which can also result in weight loss. 

So far, the technology proved to be successful in mice which were put on a high-fat diet.

What CRISPR targets is a gene for a protein called UCP1, which is distinctly found in brown fat.

The function of UCP1 is to turn chemical energy into heat.

Using the UCP1, the researchers created cells that closely resembled brown fat cells. These are called human brown-like cells or HUMBLE cells.

The manufactured HUMBLE cells are then transplanted into the mice with weakened immune systems. These mice were also fed with a high-fat diet.

Upon observation, they found that the modified cells actively helped in preventing the progression of obesity in mice and even showed improvements in the metabolic function of the animals.

Over the course of 12 weeks, the mice given white fat cells continued to gain weight while those transplanted with the HUMBLE cells showed weight loss. The latter also showed higher sensitivity to insulin, indicating that they could be protected against diabetes.

This is where it gets interesting because the technique can ultimately lead to cell therapies not only for obesity but also other metabolic disorders.

In the future, the process could evolve into something as convenient as removing a small amount of a patient’s white fat and having that engineered into brown-like fat and re-implanted to the same person’s body.

Apart from that, the HUMBLE cells also appear to send a chemical trigger to the existing brown fat stored in the mice’s own bodies, stimulating them to burn more energy.

This means that a simpler treatment method could be explored in which the experts could mimic the signal to activate the patient’s own brown fat. This will no longer require re-engineering the white fat and re-implanting it, making the entire treatment extremely straightforward.

The release of this study has profound implications to the total available market for CRISPR gene editing technology.

In the US alone, over 34 million are suffering from diabetes. The medical spending and loss of work wages linked to this is valued at roughly $327 billion annually.

If this technology proves to be effective in boosting a patient’s insulin sensitivity, then it could open an exponentially huge market.

Aside from diabetes, obesity is also considered a major risk factor in certain types of cancer, fatty liver and kidney disease, osteoarthritis, and even pregnancy problems.

This study is another example of how gene editing can be utilized to find treatments for untreatable conditions in the past years.

With this groundbreaking potential, it is no wonder investors are lining up to get their hands in biotechnology stocks in the gene editing sector.

The most widely known gene editing stock is CRISPR Therapeutics (CRSP).

With a market capitalization of $5.72 billion, this company is the only one in its field with actual treatments set for launch in the market soon.

One is a rare genetic disease treatment called CTX-001. Every year, about 60,000 people are born with this condition, causing anemia, lifelong pain, and early death. The other treatment is CTX-100, which is geared towards cancer patients.

Compared to its competitors like Editas Medicine (EDIT), which has a market capitalization of $1.82 billion, and Intellia Therapeutics (NTLA) with $1.03 billion, CRSP has a financial runway that can be reassuring to its investors.

CRSP also has minimal debt and a beneficial partnership with healthcare giant Vertex Pharmaceuticals (VRTX). This makes it one of the most attractive gene editing stocks out today.

Nonetheless, buying early stage companies, especially in the biotechnology sector, can be like oil wildcatting back in the 1930s. The key is to spread your bets broad enough to boost your chances of finding a gusher.

If this CRISPR gene editing technology works to treat obesity and even diabetes, then it could revolutionize the medical field.

While it’s still wise to exercise caution when investing in gene editing stocks, this technology undoubtedly embodies how the future of medicine looks like.

gene editing

 

gene editing

 

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Mad Hedge Fund Trader

It's Crunch Time for COVID-19 Vaccine Developers

Biotech Letter

Mark your calendars because the world is about to find out whether the leading candidates of the COVID-19 vaccine race will be effective as early as October.

Other than saving lives in this pandemic, also hinged on the results is over $100 billion in investors’ money – an amount that reflects just how much value the stock market is putting on the COVID-19 vaccine candidates under development today.

One of the leading companies in the race is Johnson & Johnson (JNJ).

With a market capitalization of almost $400 billion, many believe that this biopharmaceutical giant will soon be hailed as the king of the coronavirus stock list.

What we know so far is that JNJ’s subsidiary, called Janssen Vaccines, is set to launch a massive-scale Phase 3 study of its COVID-19 vaccine candidate, A26.COV2-S, this September.

The company’s study, which will be randomized, double-blind, and placebo-controlled, is expected to involve approximately 60,000 participants suffering from moderate to severe cases of COVID-19.

The move to include 60,000 participants is seen as a competitive advantage for JNJ because this is double the usual late-stage volunteer number.

For comparison, Moderna’s (MRNA) mRNA-1273 as well as Pfizer (PFE) and BioNTech’s (BNTX) BNT162b2 will only target a maximum of 30,000 patients each in their trials.

On top of the more expansive trial coverage, JNJ has another advantage that could help it pull ahead of the pack.

During the preclinical testing of Ad26.COV2-S on primates, the vaccine candidate showed that a single dose could be enough to fight off the virus.

In contrast, the candidates from other COVID-19 vaccine developers like AstraZeneca (AZN), Pfizer, and Moderna require two doses to trigger a similar response.

While the well-being of every man, woman, and child hangs on the success of the COVID-19 trials, concerns have been raised that the assessment for these candidates might be compromised because of the upcoming US presidential election.

However, the leading COVID-19 developers assured people that it won’t be the case.

Apart from JNJ, Pfizer, Moderna, AstraZeneca, other vaccine makers like GlaxoSmithKline (GSK), Sanofi (SNY), and Regeneron (REGN) plan to issue statements that no candidate will be submitted without extensive data on its efficacy and safety.

Most investors are focused on the COVID-19 stocks these days, and who can blame them?

Sales of the vaccines in 2021 alone could reach $20 billion per company. This is massive profit even for Big Pharma standards.

In fact, this amount is higher than the projected sales of today’s current top-selling drug, Humira from AbbVie (ABBV), which is expected to clock roughly $19.6 billion in the same period.

However, the COVID-19 vaccines will only be profitable for as long as there is a pandemic. If this disease becomes a non-recurring sickness, then the vaccines will no longer be as profitable in the long run.

This is why it’s crucial to review the core operations of a company and determine its capacity to keep generating revenue and profits while also maintaining a strong balance sheet and returning value to its investors.

JNJ is a great example of this type of business.

Outside its COVID-19 efforts, the company has been diversifying its portfolio. Its latest move is the $6.5 billion acquisition of Momenta Pharmaceuticals (MNTA), marking the biopharmaceutical titan’s expansion into the immunology sector.

One of the most significant assets JNJ acquired from this deal is Nipocalimab, which is an incredibly promising first-in-class autoimmune disease treatment.

This drug could be the answer to rare and life-threatening blood disorders, such as hemolytic disease, which affects newborns and babies. To date, there are roughly 195 million individuals suffering from this condition worldwide.

Throughout its history, JNJ has proven itself to be a stable company even in the most unstable market conditions.

It has a reliable growth record and a healthy cash flow, which would be valuable in acquiring bolt-on companies, creating new drugs, and boosting the dividend every year.

JNJ has managed to increase dividends annually for 58 years now, with its most recent dividend raise reaching 6.3% just last April. Its stock currently yields 2.7%.

More importantly, JNJ offers an impressive biotechnology pipeline. With an incredible history of over 130 years, this stock is definitely one for keeps.

 

jnj vaccine

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2020-09-08 11:00:222020-09-09 19:26:16It's Crunch Time for COVID-19 Vaccine Developers
Mad Hedge Fund Trader

September 3, 2020

Biotech Letter

Mad Hedge Biotech & Healthcare Letter
September 3, 2020
Fiat Lux

Featured Trade:

(BRACE YOURSELF FOR ANOTHER PANDEMIC)
(AMGN), (NVS), (CYTK), (GILD), (RHHBY), (LLY), (SNY), (REGN)

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2020-09-03 16:02:072020-09-03 16:14:16September 3, 2020
Mad Hedge Fund Trader

Brace Yourself for More Pandemics

Biotech Letter

“Anything that can go wrong will go wrong.”

It looks like Murphy’s law is about to strike again this year. The number of COVID-19 cases has reached almost 15 million worldwide, with about 4 million found in the US alone. However, the pandemic isn’t showing signs of slowing down.

Now, another deadly virus described to manifest “all the essential hallmarks of a candidate pandemic virus” has been found.

Earlier this month, a team of scientists revealed that there’s a newly discovered influenza strain, which could be a variation of the H1N1 swine flu—the same virus that triggered a global pandemic back in 2009.

That health crisis infected roughly 61 million Americans and more than 700 million people across the globe.

Although there’s still no conclusive evidence, this H1N1 influenza strain also traces its origins in China.

We witnessed how the stock market plummeted as the COVID-19 pandemic broke out. It eventually bounced back, which provided us with insights on how to deal with this potential second deadly virus.

Taking into consideration the uncertainty caused by these health and financial crises, I no longer put all my energy on near-term investments.

Instead, I train my eyes on stable and strong stocks with attractive revenue potential.

One of the companies that meet my criteria is Amgen (AMGN).

Amid the coronavirus pandemonium, Amgen has been aggressive in keeping its stronghold, particularly in its key moneymakers.

The latest win for the company is against Novartis (NVS), which challenged Amgen’s patent rights on the blockbuster anti-inflammatory treatment Enbrel.

This patent victory secured exclusivity for the top-selling rheumatoid arthritis injection, which generated $5.1 billion in sales in 2019 and could rake in at least $4.5 billion in 2020, against low-priced copycats until 2029.

Although Amgen has been struggling with biosimilar competition in the past years, the company’s first quarter earnings reports indicate that things are turning around for them.

Amgen reported an 11% year-over-year increase in revenue for the first quarter of 2020 to reach $6.2 billion, with global product sales jumping by 12%, boosted by a remarkable 15% in volume growth.

The company’s free cash flow for the first quarter also went up to $2 billion compared to the $1.7 billion it recorded in the same period in 2019.

The spike in Amgen’s numbers could be attributed to the new products in its pipeline. Apart from Enbrel, there are several other moneymakers generating solid growth for the company.

An obvious game-changer is severe plaque psoriasis medication Otezla, which Amgen acquired from Celgene for $13.4 billion in November 2019.

In the first 3 months of 2020 alone, Otezla has already raked in $479 million in sales for Amgen.

Sales of high cholesterol drug Repatha jumped by 62%, hitting $229 million.

Meanwhile, osteoporosis treatment Evenity contributed $100 million thanks to its expansion in the US and Japanese markets.

With the improvement in its performance, Amgen reiterated its revenue forecast for 2020 of $25 billion to $25.6 billion, showing off a 9.4% gain compared to 2019.

Aside from its current roster, Amgen is also waiting for regulatory approvals on some of its products this year.

The company is hoping for good news from the FDA on its multiple myeloma drug Kyprolis in November and its Rituxan biosimilar candidate in December.

Its pipeline also features 20 late-stage studies, 15 of which are for expanded indications of the company’s already-approved products.

Next to Otezla, Amgen is eyeing another blockbuster following the Fast Track designation granted to heart failure drug Omecamtiv mecarbil.

The drug, which the company is working in collaboration with Cytokinetics (CYTK), is projected to reach a jaw-dropping valuation of roughly $16 billion by 2026.

 

If successful, Omecamtiv mecarbil could become a close competitor of Entresto, which raked in $569 million for Novartis in the first quarter of 2020 alone.

Meanwhile, Amgen is not only focused on harnessing its growth drivers. The biotechnology giant has been active in searching for COVID-19 treatment as well.

Following the lead of Gilead Sciences (GILD), which used an already approved drug Remdesivir to come up with a treatment, Amgen is also testing its newly acquired blockbuster Otezla.

In using an anti-inflammatory drug to treat COVID-19 patients, Amgen is taking a similar approach as other biotechnology giants like Roche (RHHBY) with Actemra, Eli Lilly (LLY) with Baricitinib, and Sanofi (SNY) and Regeneron (REGN) with Kevzara.

Amgen investors currently get $1.60 in quarterly dividend payments, receiving $6.40 annually. In comparison, shareholders received $1.45 in 2019, showing off a healthy 10% hike.

With a stock price of roughly $235, this puts the company’s dividend yield to somewhere above 2.7%.

This is better than the 2% of investors earn on average from the S&P 500, indicating that Amgen pays investors with an above-average yield. Over the past 5 years, Amgen has boosted its annual dividend by nearly 103%.

Overall, Amgen is a solid long-term investment with promising growth drivers out in the market and in its pipeline.

 

Amgen

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2020-09-03 16:00:142020-09-04 13:02:07Brace Yourself for More Pandemics
Mad Hedge Fund Trader

September 1, 2020

Biotech Letter

Mad Hedge Biotech & Healthcare Letter
September 1, 2020
Fiat Lux

Featured Trade:

(RACE TO THE FINISH LINE)
(PFE), (BNTX), (MRNA), (AZN), (INO), (ZTS), (MYL)

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Mad Hedge Fund Trader

Race to the Finish Line

Biotech Letter

One of the leading companies in the COVID-19 vaccine race is getting closer to the finish line.

Pfizer (PFE) shocked the scientific community when it announced that it would be ready to submit its COVID-19 vaccine candidate, BNT162b2, for FDA approval by October.

The company said that it is now more than 50% done with the recruitment for its Phase 3 clinical trial, which requires 30,000 volunteers.

Earlier this year, Pfizer and its vaccine partner BioNTech (BNTX) were included in the US government’s Operation Warp Speed project. Although the two rejected government funding, their candidate is still included in the fast-track priority list of the FDA.

To date, the US government already secured a contract with Pfizer and BioNTech for 600 million doses of their vaccine, with the initial payment of $1.95 billion for the first 100 million doses.

Other countries across the globe have also shown faith in the science of Pfizer.

The UK government completed a deal with Pfizer for 30 million doses, while Japan ordered 120 million doses.

Since it has been preparing its manufacturing facilities while also conducting its trials, Pfizer is confident that it can produce 1.3 billion doses of BNT162b2 in 2021.

Given this timeline, it is possible for the company to launch its COVID-19 vaccine to the market by the fourth quarter of 2020, with peak sales of the product reaching $1.7 billion in 2021.

Revenue for BNT162b2 is expected to slide to $850 million by 2023, with the vaccine raking in an average of $500 million to $600 million in annual sales by then.

However, there is no such thing as a perfect solution.

A potential competitive disadvantage of Pfizer’s vaccine candidate lies in its storage requirements, which entail a storage temperature of −94°F.

While tertiary hospitals and laboratories can meet this requirement, it would make it difficult for traditional offices or pharmacies to store the product.

This shortcoming might prompt other governments and private institutions to consider other vaccine candidates with simpler storage requirements.

Although the results have yet to be released, early data show that competitors like Moderna (MRNA), AstraZeneca (AZN), and Inovio Pharmaceutical (INO) might offer less complicated solutions.

Outside its widely publicized COVID-19 vaccine efforts, Pfizer has been working on additional spinoffs to boost and diversify its revenue stream.

Investors of the company would agree that Pfizer is the kingpin of spinoffs.

A prime example of this is its animal healthcare Zoetis (ZTS) spinoff, which was established in 2013. Since then, the investors have experienced impressive returns with over 289% yields. 

Now, Pfizer is aiming to replicate this feat with the $195 billion merger of its own off-patent and generic drugs unit Upjohn with Pennsylvania-based company Mylan (MYL).

The two companies are slated to form a mega-company, called Viatris, where Pfizer stakeholders will also receive shares.

Looking at its portfolio and pipeline candidates, Viatris is projected to generate approximately $19 billion to $20 billion in annual revenue and record $4 billion in free cash flow.

On top of the Viatris spinoff, Pfizer is also working on the Nasdaq IPO of Cerevel Therapeutics.

This is an interesting move from Pfizer since Cerevel is a neuroscience company, which focuses on diseases of the central nervous system like Alzheimer’s, Parkinson’s, and epilepsy.

Pfizer owns 25% stake of the neuro company while Bain Capital holds 75%. The two established Cerevel in 2018.

Just last July, Cerevel announced its merger with Arya Sciences Acquisition Corp II.

When the merger is finalized, the new company will be called Cerevel Therapeutics Holdings and will be under the ticker symbol “CERE” in Nasdaq. The deal is expected to be completed by the fourth quarter of 2020.

Although it will be a relatively unknown and new company, Cerevel is expected to receive at least $445 million to use for its growth by the end of the year.

Needless to say, this is expected to be another “Zoetis-in-the-making” strategy from Pfizer.

For 2020, Pfizer raised its revenue guidance and estimates that it can generate somewhere between $48.6 billion and $50.6 billion while recording an earnings per share of roughly $2.85 and $2.95.

Looking at its balance sheet, Pfizer has proven itself capable of weathering one of the most debilitating downturns since The Great Depression.

In fact, the company amassed revenue of $12 billion and showed off a respectable 12% operational growth in its biopharma unit in the first three months of this year.

In its second quarter earnings report, when the COVID-19 pandemic was already well underway, Pfizer raked in $11.8 billion in revenue.

With all the publicity surrounding the COVID-19 vaccine efforts, it is understandable that investors are buying at artificially high prices. However, Pfizer remains incredibly undervalued.

Pfizer’s star power would inevitably surge if BNT162b2 proves to be safe and effective. Even without the vaccine though, the company’s diverse portfolio and impressive acquisition strategies already make it a great buy.

Plus, its healthy dividend, which yields approximately 3.9%, is no doubt the icing on the cake for this incredibly undervalued stock.

pfizer covid-19 vaccine

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2020-09-01 11:00:162020-09-02 00:26:46Race to the Finish Line
Mad Hedge Fund Trader

August 27, 2020

Biotech Letter

Mad Hedge Biotech & Healthcare Letter
August 27, 2020
Fiat Lux

Featured Trade:

(THE FUTURE OF GENE-EDITING TECHNOLOGY)
(CRSP), (VRTX), (BAYRY), (NTLA), (NVS), (EDIT), (BMY)

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2020-08-27 13:02:492020-08-27 14:51:22August 27, 2020
Mad Hedge Fund Trader

The Future of Gene-Editing Therapy

Biotech Letter

There are wise investments, and there are excellent investments.

CRISPR Therapeutics (CRSP) has been proving to qualify in the latter category.

In fact, the company is considered one of the best biotechnology stocks to own during these turbulent times. It is estimated to dominate the gene-editing therapy market, which will reach roughly $11.2 billion in worth by 2025.

Four years ago, CRISPR Therapeutics stock was trading at $14.09. Today, each share is worth $90.35.

This means that CRISPR Therapeutics biotechnology company has been trading for 540% more than its value since it went public in 2016.

This is a remarkable pace for a biotechnology stock, with CRISPR Therapeutics raking in $289 million in trailing 12-month revenue thanks to strategic collaborations.

It even has a decent $890 million stored in cash, with the company reporting a 16% profit margin despite not having any treatment or drug available in the market yet.

More importantly, CRISPR Therapeutics holds a novel position of being under absolutely zero pressure to push a product out the door.

Nonetheless, the investor confidence in CRISPR Therapeutics relies heavily on the company’s leading position in the groundbreaking world of gene-altering treatments.

Basically, the company specializes in creating and developing therapies for genetic diseases with either no cure available or require frequent transfusions.

Looking at the results of the recent tests on the company’s pipeline candidates, CRISPR Therapeutics is projected to transform into a household name in the next five to 10 years.

CRISPR Therapeutics has five cell therapy candidates in the clinical stage. Three of these target immuno-oncology, while the two are designed for genetic blood disorders like beta-thalassemia sickle cell disease.

Among the five, the most advanced is CRISPR Therapeutics’ collaborative work with Vertex Pharmaceuticals (VRTX) on beta-thalassemia therapy CTX001.

This candidate received a fast-track designation from the FDA, with CRISPR Therapeutics releasing promising preliminary results recently.

However, it is another Vertex collaboration drug that actually yielded CRISPR Therapeutics $25 million at the beginning of 2020.

The drug, which is developed to treat muscular dystrophy disorder, is expected to account for approximately $800 million in future milestone payments in the next few years.

Although the genetic blood disorder programs are raking in millions these days, CRISPR Therapeutics’ cancer treatment pipeline offers an even greater potential in terms of stable revenue streams.

The company is utilizing a gene-editing platform, called CRISPR/Cas9, to create “off the shelf” novel chimeric receptor (CAR) T-cells.

If successful, then CRISPR Therapeutics can use a single batch to treat a broad group of cancer patients.

This is groundbreaking because the typical way involves harvesting T-cells from the patients, tailor-fitting the therapies, then re-introducing the cells to the body.

With this technology, CRISPR Therapeutics can easily cover more markets and offer regular treatments for patients within shorter intervals.

That’s why it comes as no surprise that a major biotechnology player like Bayer (BAYR) reached out to the smaller company for a collaboration.

The CAR T-cell market is projected to hit $8.4 billion by 2027, with an estimated compound annual growth rate of roughly 15%.

Specifically, CRISPR Therapeutics expects this product to become a leader in the solid tumor cancer therapy space, pegged to reach $425 billion by 2027.

However, it is not only CRISPR Therapeutics that is widely known in the gene-editing sector.

To date, the company has two close competitors: Intellia Therapeutics (NTLA), which has a strategic partnership with Novartis (NVS), and Editas Medicine (EDIT), which is working alongside Bristol Myers-Squibb (BMY).

Both are also using the CRISPR/Cas9 technology to come up with treatments.

Although Intellia Therapeutics and Editas went public the same year as CRISPR Therapeutics, neither has performed quite as well.

For perspective, CRISPR Therapeutics currently has a market capitalization of $6.3 billion. In comparison, Intellia Therapeutics has $1.13 billion while Editas Medicine has $2.13 billion.

Keep in mind though that clinical-stage companies, particularly in the biotechnology sector, are inherently risky plays.

Among the companies in the space, CRISPR Therapeutics is emerging to be a solid bet not only from a cash perspective but also based on its strong pipeline and profitable collaborations.

Overall, CRISPR Therapeutics is still considered a high-risk option.

Hence, the safest way to invest is to build a carefully hedged portfolio filled with well-researched gene-editing stocks. This will minimize your risks and guarantee your exposure to the upside in case any of your chosen biotechnology companies makes it to the market with a groundbreaking therapy.

crispr

 

crispr

 

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2020-08-27 13:00:452020-08-30 15:35:40The Future of Gene-Editing Therapy
Mad Hedge Fund Trader

August 25, 2020

Biotech Letter

Mad Hedge Biotech & Healthcare Letter
August 25, 2020
Fiat Lux

Featured Trade:

(LET THE VACCINE PRICING WARS BEGIN)
(MRNA), (MRK), (PFE), (BNTX), (AZN), (JNJ), (NVAX), (SNY)

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2020-08-25 15:02:312020-08-25 15:02:13August 25, 2020
Mad Hedge Fund Trader

Let the Vaccine Pricing Wars Begin

Biotech Letter

The COVID-19 vaccine race is winding down to its final lap, with at least seven candidates already undergoing Phase 3 trials.

Now, one question inevitably arises: How much will these vaccines cost?

Moderna (MRNA), one of the frontrunners in this race, revealed that its vaccine, mRNA-1273. will be priced somewhere between $32 and $37 for each dose.

The moment this pricing was announced, health advocates were up in arms to point out the high price of the vaccine especially with the funding Moderna received from the US government.

However, the company clarified that this would only apply to “small-volume” transactions.

According to Moderna, the pricing for their coronavirus vaccine should be viewed in two phases: the pandemic and the endemic periods.

During the pandemic period, the coronavirus vaccine would be given a price “well below” its actual value. The pricing will change and eventually be more in line “with other innovative commercial vaccines” when the crucial period passes.

For reference, flu shots are typically priced somewhere between $50 to $120 depending on the clinic while a single-dose HPV vaccine from companies like Merck (MRK) can cost up to $235.

Despite the clamor to further investigate this pricing scheme, Moderna sealed another deal with the US government worth $1.525 billion if the company succeeds in meeting its promised timeline.

This will translate to roughly $100 million doses.

It also stands to gain an additional $8.125 billion in follow-up doses plus the $300 million bonus if it can score an FDA approval by January 31, 2021.

Another frontrunner in this coronavirus vaccine race is Pfizer (PFE).

Among the healthcare and biotechnology companies working on a vaccine, Pfizer and its German partner BioNTech (BNTX) are reported to have the most lucrative contract with the federal government to date.

The company recently sealed a $1.95 billion deal for 100 million doses. This puts Pfizer’s coronavirus vaccine at roughly $20 per dose.

Both vaccine candidates from Pfizer and Moderna require two doses.

In comparison, Johnson & Johnson (JNJ) has a “one-and-done” vaccine candidate. That is, the Ad26.COV2-S showed potential that it could only require a single dose.

This is definitely a competitive edge as it will eventually be a cheaper and more convenient alternative to the two-dose vaccine offered by its competitors.

In terms of pricing, JNJ recently landed a $1 billion contract with the US government to deliver 100 million doses. This translates to $10 per dose.

However, AstraZeneca (AZN) appears to be the favored candidate by the US government.

In fact, recent reports suggest that the Trump administration is considering bypassing normal regulatory standards in the UK to fast track the delivery of the vaccine candidate to the US — all before election day.

What we know so far is that AstraZeneca, which is developing its vaccine in collaboration with the University of Oxford, signed a deal with the US government worth $1.2 billion.

This will amount to 300 million doses of their vaccine candidate, which puts the cost of each dose to roughly $4. At this price point, AstraZeneca offers the cheapest option.

Meanwhile, small-cap biotechnology company Novavax (NVAX) recently signed a similar deal with the government.

The Maryland-based company agreed to manufacture 100 million doses of its vaccine for $1.6 billion. This works out to approximately $16 per dose.

Next to Moderna, Novavax’s journey this year has been considered a “Cinderella story” by a lot of investors.

The company ended 2019 all banged up, with the biotechnology stock falling by almost 90%, thanks to its failed respiratory syncytial virus (RSV) vaccine candidate.

However, Novavax rose from the ashes following the encouraging results of its late-stage study for NanoFlu, another vaccine candidate.

By March 2020, Novavax’s flu vaccine released promising data that put NanoFlu in direct competition against Sanofi’s (SNY) flu vaccine Fluzone Quadrivalent.

Riding the momentum of their success with NanoFlu, Novavax joined the COVID-19 vaccine race with NVX‑CoV2373.

While companies like Pfizer, Moderna, JNJ, and AstraZeneca have been gaining media attention, an increasing number of health experts and analysts are claiming that Novavax’s candidate might just be the best in class.

Outside the companies under Trump’s Operation Warp Speed, China’s state-owned company, Sinopharm, also announced the pricing for its COVID-19 vaccine candidates.

The pricing is quite higher than those put forward by other vaccine developers, with the Beijing company quoting $145 for two doses.

Aside from China, Russia also has a vaccine candidate expected to be out in the market soon.

Vladimir Putin claims that Russia’s coronavirus vaccine candidate is similar to the one created by AstraZeneca and Oxford University.

No information has been given on either the results of the vaccine’s late-stage trials or its pricing.

To date, the World Health Organization (WHO) has recorded 7 vaccine candidates undergoing Phase 3 clinical trials, while there are 15 more going through Phase 2 expanded safety trials.

An additional 25 candidates are currently under Phase 1 small-scale trials plus another 138 pre-clinical candidates slated for human trials soon.

 The development and success of at least one coronavirus would undoubtedly reverse the economic and financial damage brought by the pandemic. Hopefully, that time will come soon.

vaccine pricing

 

vaccine pricing

 

vaccine pricing

 

 

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2020-08-25 15:00:062020-08-26 18:50:50Let the Vaccine Pricing Wars Begin
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