(BNTX) Archives - Page 5 of 16 - Mad Hedge Fund Trader

A Biotech Stock Poised for a Rebound

Healthcare stocks have experienced an unusual run over the past few years. The sector was nearing scorching hot levels when the pandemic started, only to go ice cold by the end of 2021.

Nonetheless, seasoned investors in the sector know that solid companies will continue to grow at a steady pace despite the decline in their stock prices.

This is where the fun starts for some investors.

After all, we all enjoy a good bargain, especially when it comes to promising stocks. What makes it even more enticing is if the stock has a proven track record and solid prospects in its pipeline.

Based on these criteria, one name that readily comes to mind is Moderna (MRNA).

Since it reached its peak in August 2021, Moderna shares have fallen by over 60%. Despite these losses, the business is still regarded as one of the most promising companies in the sector. This means that the stock can recover soon.

Moderna is a significant mover in one of the hottest markets today: the COVID-19 vaccine sector. Since the pandemic started, the company has been able to generate billions of dollars in profit from its only commercialized product: mRNA-1273.

While the demand has been divided now due to the entry of other vaccine developers, Moderna still expects to earn at least $19 billion from its COVID-19 vaccine.

Before becoming a household name, not many people knew of Moderna’s existence. At that time, most weren’t even confident that the messenger-RNA vaccines would actually work.

In the early stages, Moderna was only rivaled by Pfizer (PFE) and BioNTech (BNTX) in this particular field. Meanwhile, the rest of the world was betting on other companies like AstraZeneca (AZN), Johnson & Johnson (JNJ), and even Novavax (NVAX).

As soon as the results came out, Moderna shares skyrocketed to unprecedented heights. In 2020, the company recorded a 434% growth.

However, recent times have not been as kind to Moderna. Investors now worry that this might be the reality, a.k.a. the post-pandemic sales.

This is far from the truth.

Admittedly, sales from the vaccine would dwindle over time due to competition and possibly even herd immunity.

In preparation for this eventuality, Moderna has been stocking up its pipeline. Recently, the company announced pivotal Phase 3 trials for two of its vaccine candidates.

One is for cytomegalovirus (CMV) and the other is for the respiratory syncytial virus (RSV).

Both candidates hold the potential to become blockbusters.

The RSV market is projected to become larger than initially anticipated, reaching roughly $10 billion. Given the promise of this sector, it comes as no surprise that Moderna has competitors. Sanofi (SNY), GlaxoSmithKline (GSK), and Pfizer are some of the biggest players here.

As for the CMV vaccine, the product has the potential to reach $2 to $5 billion in annual sales. Moreover, this program can be linked to other sectors like oncology and autoimmune diseases.

Other than these, Moderna has been developing its HIV vaccine. It already started with trials, with its first participant queued to receive the first dose of the experimental candidate.

This could be another massive revenue stream for Moderna as the annual spending on HIV is estimated to reach $500 billion globally.

Another candidate is Moderna’s flu vaccination program. However, this might be a more difficult path as the company faces strong challengers, including Pfizer, Novavax, and GSK.

In addition to these, the company is also working on Nipah and Zika vaccines. There are also plans for herpes simplex virus (HSV) and varicella zoster virus to join the roster soon.

Cornering the vaccine market is a good approach since Moderna has a tested and proven product dominating the industry today.

That is, no one is doubting the power and efficacy of mRNA-based strategy in vaccines.

More importantly, there is no question that Moderna is performing well in this field. This is an unshakeable and established strength that Moderna investors should be focusing on.

A seemingly unstoppable stock in the past few years, this company suddenly fell out of favor. Nevertheless, its prospects remain the same and it can still deliver significant revenue—something that’s expected to go on well into the future.

March 17, 2022

Biotech Letter

Mad Hedge Biotech and Healthcare Letter
March 17, 2022
Fiat Lux

Featured Trade:

(A SECURE STOCK TO ASSUAGE YOUR FEARS)
(NVS), (INCY), (ABBV), (VYGR), (PFE), (BNTX), (CVAC), (RHHBY)

A Secure Stock to Assuage your Fears

Biotech Letter

The year 2022 marked the time fear made a comeback to Wall Street.

Since the year began, we’ve been plagued with fears over Russia’s invasion of Ukraine, constant threats of high inflation, and the possibility of a recession.

There’s even the fear of major corrections among overheated stocks that could drag the entire market along with it.

Nevertheless, it’s critical to bear in mind that what we have is a market of stocks rather than a stock market.

Although the S&P has been unstable and the Nasdaq continues to be riddled with corrections, we can still be confident that value stocks and, of course, dividend stocks are faring much better.

Truth be told, that’s hardly surprising since value stocks typically outperform the market even in the most challenging periods.

Moreover, the highest-quality stocks tend to deliver the best performance.

When it comes to high-value stocks, one of the defensive, low volatility names that constantly crops up is Novartis (NVS).

To date, Novartis is considered as one of the Big Pharma companies globally, with a staggering market capitalization of $224 billion.

Recently, Novartis has become more aggressive in diversifying its lineup—a strategy that showed tremendous payoffs.

After all, one of the competitive edges of Novartis is its solid profitability compared to its peers, which is primarily driven by the company’s well-balanced portfolio.

For years, the company has been widely known for its oncology treatment portfolio, which was strengthened by its eventual collaboration with Incyte (INCY).

Apart from cancer, it has so far succeeded in developing treatments for cardiovascular, immunology, and even blood disorders.

Its current portfolio of drugs generated impressive revenue despite the economic slowdown over the past months.

For example, psoriatic arthritis drug Cosentyx, which is AbbVie’s (ABBV) top-selling Humira’s biggest competitor, raked in $3.5 billion in sales last year, showing off a 20% increase year-over-year, while myelofibrosis treatment Jakavi reported a 23% jump to reach $1.2 billion.

Meanwhile, heart failure treatment Entresto recorded an impressive 46% climb year-over-year to reach roughly $3 billion.

Aside from these, Novartis has a promising pipeline. Thus far, it has 54 programs queued for Phase 3 trials.

Even if we assume that the company only achieves a 50% success rate, these new products could still add substantial revenue streams within the next few years.

Further leveraging its size and capital, Novartis has been searching for avenues to expand its in the biotechnology market.

Its latest move towards this direction is a license option agreement with Voyager Therapeutics (VYGR).

Novartis has long been on a perennial search for revolutionary therapies to take under its wing, and this deal with Voyager appears to be an excellent opportunity for both companies.

In a nutshell, the two companies have agreed to collaborate on gene therapy programs for adeno-associated virus capsids.

This biobucks deal sees Novartis paying Voyager $54 million upfront, with the possibility of shelling out up to $1.7 billion in several milestone payments and royalties.

The agreement covers three programs targeting the central nervous system plus potentially two more after 12 months.

In addition, Novartis will be granted access to Voyager’s proprietary RNA-based screening platform used to deliver the payload in gene therapy-based treatments.

Another biotechnology-related venture for Novartis is its deal with Carisma Therapeutics.

Following its success with the COVID-19 vaccine production for Pfizer (PFE) and BioNTech (BNTX), the Big Pharma company entered another contract manufacturing agreement with Carisma Therapeutics.

In this deal, Novartis will handle the manufacture of Carisma’s HER2-targeted CAR-M cell therapy, which is under development for the treatment of solid tumors and is slated to be submitted for approval in 2023.

Other than Carisma, Novartis also signed an initial manufacturing deal with CureVac (CVAC) and Roche (RHHBY) in 2021.

Overall, this makes Novartis a relatively safe and low-risk play in the biotechnology and healthcare sector.

Global Health Tech Pioneer Soaring Under the Radar

Biotech Letter

The COVID-19 pandemic has shed light on innumerable flaws in the way several industries function, ranging from the healthcare system to the global supply chain.

At the same time, this phenomenon granted a rare chance for several innovative businesses to offer solutions to these flaws.

Although COVID-19 is a healthcare issue, the secondary effects like economic and financial instability it caused aggravated the situation.

Worldwide poverty worsened in 2020—something that has not happened in 20 years—forcing roughly 100 million individuals below the poverty line.

The absence of much-needed essential healthcare products and services in several areas across the globe resulted in restricted capacity to respond to the pandemic and its effects.

While the situation was definitely heightened in developing nations, even countries like the United States struggled with the situation, with 1 in 4 adults suffering from 2 or more chronic health conditions.

Moreover, the country’s national healthcare expenditure rose 9.7% to reach $4.7 trillion in 2020, accounting for 19.7% of the GDP. That’s roughly $12,530 per person.

That’s why it comes as no surprise that even the most developed areas of the globe are scrambling to find answers to the debilitating cost of healthcare.

A total of $44 billion was raised in 2021 solely for healthcare innovation initiatives. This represents a jaw-dropping increase from the $22 billion raised in 2020.

Notably, 2021 also saw a 50% rise in health tech companies' acquisitions, and these numbers are anticipated to climb in 2022 and beyond.

By 2028, the US national healthcare expenditure is projected to hit $6.2 trillion, primarily due to the steady increase in spending on healthcare technology.

While the rise in expenditure would undoubtedly lead to improved healthcare quality, the increase tends to be misleading because it implies an increase in cost as well.

That can’t be any further from the truth.

Aside from offering life-saving solutions, the introduction of more advanced technology like AI in healthcare actually saves money. In fact, the estimated savings rate annually by 2026 is at $150 billion.

Given that AI technology alone is anticipated to save roughly 22,000 people each year starting 2033, the most logical move is for the healthcare industry to keep investing in this kind of technology and other life-saving solutions.

One critical player in this transition period is Iqvia Holdings (IQV).

This company, which was featured in Fortune’s “World’s Most Admired Companies” in 2022 and the No. 1 in “Healthcare: Pharmacy and Other Services, focuses on leveraging data science to provide life-saving solutions.

It was formed in 2016 following the merger of Quintiles and IMS and has since then transformed into the leader in health information technology in the world.

The company aims to elevate research and innovation through offering business intelligence to the healthcare industry and offering its assistance in clinical studies.

While Iqvia did not become a household name like Moderna (MRNA), Pfizer (PFE), and BioNTech (BNTX), this health tech company gained popularity during the COVID-19 pandemic.

Iqvia was able to provide the necessary insights that organizations needed to manage the effects of the pandemic. The company's analysis proved to be vital in coordinating efforts, predicting future situations, and determining unforeseen problems.

The capacity to share their valuable data anywhere in the world drastically reduced the time wasted on coordinating and boosted efficiency.

Basically, Iqvia has three primary segments: Technology and Analytics Solutions, R&D segment, and Contract Sales and Medical Solutions.

Despite the challenges of the pandemic and its effects, Iqvia’s three segments still managed to grow.

The revenue of Technology and Analytics Solutions climbed by 10%, reaching a total of $1.34 billion.

Meanwhile, its R&D division raked in $1.85 billion, showing off a 32.4% rise from the same period in 2020. While this is an impressive growth, the company aims to continue expanding, with an additional $6.9 billion worth of backlog in its R&D in 2022.

Finally, the revenue of its Contract Sales and Medical Solutions sector reached $201 million, with more and more services expected to enter the market.

However, one of the most promising stats from Iqvia is its recent buyback in September 2021. The company repurchased shares worth $202 million using its accumulated cash, of which $125 million was generated in the third quarter alone.

Following this move, the company still has $697 million left in share repurchase authorization. This recent buyback follows an Iqvia tradition, which dates back to 2018—a tradition that definitely inspires confidence in the long-term outlook of the company.

Other than these three core businesses, Iqvia has revealed the addition of a Research Nursing and Phlebotomy services unit.

The emergence of these mobile units would ensure that the company becomes more accessible and can offer more affordable services.

Another new segment is its Grants and Funding Management platform, which offers solutions to other companies in the life sciences.

Iqvia is a pioneering name in the healthcare industry, and this company is among the handful of names that look extremely promising.

Looking at its trajectory, Iqvia has proven its rightful place in this emerging market by delivering highly critical improvements and essential insights.

Considering all these, Iqvia is no doubt a rock-solid bet.

iqvia

February 17, 2022

Biotech Letter

Mad Hedge Biotech and Healthcare Letter
February 17, 2022
Fiat Lux

Featured Trade:

(IS THIS THE SOLUTION TO ANTI-VAXXERS?)
(NVAX), (MRNA), (PFE), (BNTX), (SNY)

Is This The Solution To The Anti-Vaxxers?

Biotech Letter

One of my old friends, a 45-year-old teacher, has long held the belief that getting vaccinated against COVID-19 is a terrible idea.

Despite the growing number of people getting jabbed, he still felt uneasy over the new mRNA technology applied in the two most widely used shots, Moderna (MRNA) and Pfizer (PFE) / BioNTech (BNTX).

His anxiety worsened when his neighbor was sent to the hospital following his second shot, especially after the doctors said that the official cause of the heart muscle inflammation was the vaccine.

No amount of convincing could change his mind regardless of how many times I explained that the condition was a rare and relatively mild side effect.

However, things seemed to have changed when he heard about the Novavax (NVAX) vaccine, Nuxavoxid.

Since Nuxavoxid uses a decades-long pre-existing protein-based platform instead of a novel approach, more and more people like my friend are starting to take interest and considering signing up for the vaccine.

Actually, this reaction can be observed not only in the US but also across the globe. Data suggest that previously wary individuals now feel more confident over a more established technology.

Novavax’s vaccine uses a recombinant protein technology, which has been around since the mid-1980s.

In fact, this has become the go-to or standard platform used in developing vaccines against Hepatitis B, cervical cancer, and even meningitis.

What does this mean for Novavax?

Considering that over half of the global population has already been inoculated, it’s safe to say that Novavax is late to the party.

However, recent reports showed that a fourth vaccine does not show any significant antibody increase. This isn’t particularly promising especially in light of the Omicron variant.

Moreover, the EMA warned that "repeat boosters every four months might actually weaken people's immune systems. Boosters can be done once, or maybe twice, but it's not something that we can think should be repeated constantly.”

This can be good news for the newcomer Novavax.

Since Novavax uses a recombinant nanoparticle technology, this approach might be considered more effective as a booster shot instead of using the same mRNA technology for a fourth jab.

So far, this is presumed as one of the major reasons for Israel’s—one of the leading countries in vaccine administration—decision to place an order for an alternative COVID-19 vaccine last January.

Instead of reordering from Pfizer or Moderna, Israel opted to get 5 million doses, with an option to add 5 million more, of Novavax vaccine to serve as the fourth booster for its population.

Given that Israel is ordering for its 9.4 million citizens, this deal would serve as an excellent source of real-life data for Novavax’s candidate and whether it can become the go-to choice for booster shots across the globe.

Before this development, Novavax’s projected 2022 revenue was at $4.94 billion. However, the recent regulatory approvals from various nations and advanced orders have the company adjusting this projection.

Needless to say, the possibility of Nuxavoxid practically monopolizing the booster shot market has dramatically bolstered expectations.

On top of these, Novavax has been simultaneously working on a flu vaccine, Nanoflu, that can rival Sanofi’s (SNY) FluZone.

Given that the market size for influenza is expected to grow from $6.5 billion in 2022 to $10.73 billion by 2028, and the fact that Nanoflu easily outperformed the leading product by 40% in clinical trials, it’s safe to say that this is yet another promising revenue stream for Novavax.

Overall, I think Novavax is a good long-term play. It’s important to remember, though, that Novavax’s profile is very close to Moderna and BioNTech.

That means investors interested in this stock must have boundless patience and a strong stomach for the volatility in the following months.

Looking at its excellent potential, it’s clear that the stock is undervalued. Hence, it would be wise for interested investors to buy the dip.

February 10, 2022

Biotech Letter

Mad Hedge Biotech and Healthcare Letter
February 10, 2022
Fiat Lux

Featured Trade:

(A HEALTHCARE ENIGMA TO ADD TO YOUR WATCHLIST)
(GILD), (JNJ), (PFE), (ABBV), (LLY), (MRK), (BMY),
(AMGN), (MRNA), (AZN), (REGN), (BNTX), (NVAX)

A Healthcare Enigma to Add to Your Watchlist

Biotech Letter

The top names in the biopharmaceutical world based on their market capitalization include Johnson & Johnson (JNJ), Pfizer (PFE), AbbVie (ABBV), Eli Lilly (LLY), Merck (MRK), Bristol Myers Squibb (BMY), Amgen (AMGN), and Gilead Sciences (GILD).

Among these names, Gilead is often viewed as an enigma, given its history and the challenge in predicting its share price trajectory.

Over the past months, Gilead has been testing the patience of investors. In fact, the company is projected to experience a fall in revenues this year from $27 billion in 2021 to $24.05 billion in 2022.

The latest news that added to their anxiety was the pause on clinical trials for its cancer therapy, Magrolimab.

This came after its short-lived dominance in the Hepatitis C segment.

At that time, the sales of its leading drug Sovaldi skyrocketed from $140 million in 2013 to a jaw-dropping $10.2 billion by 2014.

Meanwhile, another Hepatitis C treatment, Harvoni, single handedly raked in $13.8 billion in sales in 2015, pushing the entire company’s revenues to an impressive $32.6 billion.

Unfortunately for Gilead, it became the victim of its own staggering success.

Its Hepatitis C treatments, Sovaldi and Harvoni, were incredibly effective and managed to cure the patients within months. The demand for these drugs fell because the patient pool gradually ran dry.

By 2019, the Hepatitis C franchise of the company had declined and managed to scrape $2.9 billion in combined sales.

Since then, though, the company has been struggling to regain investors' faith.

Nevertheless, these recent developments are not enough reasons to panic. If anything, Gilead has simply become even more attractively priced due to the fallout.

In 2020, Gilead managed to report its first year-on-year increase in revenues since its glory days in 2015.

As the COVID-19 pandemic started to take hold of the world, it was Gilead’s Veklury (Remdesivir) that secured the first-ever Emergency Use Authorization from the FDA.

While Veklury was eventually overshadowed by COVID-19 vaccines from Pfizer, Moderna (MRNA), JNJ, and AstraZeneca (AZN), as well as other treatments and antibody cocktails from Eli Lilly, Regeneron (REGN), and Merck, Gilead’s candidate managed a comeback by the fourth quarter of 2021 after experts declared it to be effective against the Omicron strain.

In effect, Veklury had a major impact on the company’s 2021 performance, recording $5.6 billion in annual sales.

Although this is not as illustrious or groundbreaking as its Hepatitis C treatments, the reemergence of Gilead as a frontrunner in the pandemic is proof that the company has not lost its knack for discovering and developing a winning formula for blockbuster treatments.

Another avenue that Gilead has been exploring is actively acquiring assets to expand its portfolio.

One notable move in that direction is its $11.9 billion acquisition of Kite Pharma, a leader in the cell therapy space, in 2017. Thus far, this agreement has yielded two drugs: Yescarta and Tecartus.

Since oncology is one of Gilead’s major areas of concentration, the commercialization of these two treatments conveys a promising future.

While both are yet to become blockbusters, the field of cell therapy has been rapidly expanding and turning into a critical therapeutic option for certain patient categories.

Yescarta is projected to rake in $1.5 billion in revenues if it receives the FDA green light for large B-cell lymphoma

Considering that its last trial data showed off a 60% improvement with Yescarta compared to standard of care in terms of halting the disease’s progression or even death, there’s a huge possibility that Gilead will be delivering good news soon.

As for Tecartus, this treatment received approval for acute lymphoblastic leukemia last year and is aiming to expand to cover mantle cell lymphoma by July 2022.

With its list price of $373,000, this CAR-T therapy is projected to reach blockbuster status in the following months as well.

Another oncology drug anticipated to reach blockbuster status soon is metastatic triple-negative breast cancer treatment Trodelvy, which Gilead gained access to following a $21 billion deal with Immunomedics in 2020.

Given its current approved indications and the queued trials to expand its coverage, Trodelvy is projected to reach $4.7 billion in peak sales.

Going back to the 2022 revenue forecast for Gilead, I think the change is from the company’s anticipated decline in Veklury sales.

Since Pfizer, BioNTech (BNTX), Novavax (NVAX), and Moderna have been actively working on Omicron-focused vaccines and treatments, Gilead expects its Veklury revenues to shrink as well.

Overall, Gilead still presents an excellent opportunity for long-term investors.

Despite its setbacks, the company has proven that it still holds the knack of rolling out remarkable and effective best-in-class treatments.

Moreover, its pipeline is filled with promising candidates poised to deliver in the years to come. So, don’t be too quick to write off Gilead just yet.

gilead

January 25, 2022

Biotech Letter

Mad Hedge Biotech and Healthcare Letter
January 25, 2022
Fiat Lux

Featured Trade:

(WHAT TO WATCH OUT FOR IN 2022)
(PFE), (BNTX), (AZN), (JNJ), (MRNA), (RHHBY), (RXRX), (TAK), (PSTX), (ZY), (DNA)

What to Watch Out for in 2022

Biotech Letter

The past two years have been focused on finding solutions to end the COVID-19 pandemic.

More have been attempting to join Pfizer (PFE), BioNTech (BNTX), AstraZeneca (AZN), Johnson & Johnson (JNJ), and Moderna (MRNA) in sustaining and even boosting the momentum in terms of vaccine development and launch of new drugs in the market.

While the biotechnology and healthcare industry will still predictably have COVID-19 as one of its priorities, I can see a number of promising developments waiting to be unleashed to the public this year.

One is the expansion of mRNA applications to go beyond its potential as a coronavirus vaccine.

In the first three quarters of 2021, Moderna recorded $10.7 billion in sales for its mRNA vaccine while Pfizer-BioNTech raked in $39 billion—and these numbers are expected to soar even higher for 2022.

However, what’s more promising is that the pandemic revealed an undeniable and irrefutable fact: mRNA-based treatments could be administered safely and successfully to patients.

That discovery appears to have bolstered investor confidence in the technology, as an increasing number of RNA-based drug developers managed to lure hundreds of millions in terms of financing.

China’s Abogen Biosciences received over $700 million in its Series C round last August, while another RNA-focused biotech, Massachusetts-based Laronde, raked in $440 million in a Series B round during the same period.

Another technology on the rise is artificial intelligence (AI).

For years, AI has grown from science fiction tales to real-life applications. Lately, this segment has shown signs of finally coming up with a breakthrough.

In fact, something groundbreaking might arise in the healthcare world courtesy of Roche (RHHBY) and its Genentech subsidiary.

After all, these two became the talk of the industry in December 2021 when they committed roughly $12 billion in exchange for access to the revolutionary operating system of Recursion Pharmaceuticals (RXRX).

Ultimately, the collaboration aims to come up with advanced treatments—40 programs in total—for various conditions, focusing on neuroscience and oncology.

Aside from mRNA and AI, another sector that’s expected to rally this year is the cell and gene therapy segment.

So far, more capital has poured into this area and a growing number of programs are entering Phase 3 trials.

In the first six months of 2021 alone, gene therapy companies raised approximately $6.4 billion in funding and queued 376 trials.

This notably surpassed 2020’s performance, which recorded $2.2 billion and 359 trials.

By the second half of 2021, big money started to come in with billion-dollar partnerships cropping up everywhere.

These included Takeda Pharmaceutical’s (TAK) collaboration with Poseida Therapeutics (PSTX), worth roughly $3.6 billion, as well as Roche’s partnership with Washington’s Shape Therapeutics at $3 billion.

On top of these exciting breakthroughs is another exciting development: synthetic biology.

In the first six months of 2021, the synthetic biology segment attracted about $8.9 billion in venture funding.

To top it off, the sector managed to launch two successful IPOs last year: Zymergen (ZY) and Ginkgo Bioworks (DNA).

Considering the growing momentum in this field, synthetic biology is anticipated to remain on track and achieve full-scale marketing and manufacturing across many applications. These can span from essential medicines to even various foods such as dairy and meat.

Although the biotechnology and healthcare sector struggled in the past months, it’s undeniable that the market still has faith in the industry’s future and potential.

In fact, investors showered the biotechnology segment with a record-breaking $24 billion in terms of venture capital in the first three quarters of 2021, exceeding the $20 billion total generated in 2020.

Throughout the years, biotechnology has transformed from a restrictive academic enterprise into a booming industry with real-world applications.

Looking at the history and trajectory of this sector, I can say that the trend will continue into 2022 and beyond.