(REGN) Archives - Page 2 of 16 - Mad Hedge Fund Trader

Ears To The Ground

When your kid is part of a cutting-edge trial for hearing restoration, you're practically glued to their every reaction. That's the case for the parents of the first little one to receive Regeneron's (REGN) experimental gene therapy, DB-OTO.

This groundbreaking treatment delivers the missing otoferlin protein to the sensory hair cells in the ear, restoring signal transmission and, theoretically, giving these kids the gift of hearing.

The baby, part of the CHORD trial, started responding to sounds at home way before the docs officially confirmed it.

"Beautiful" is Regeneron described this early sign of progress. Turns out, nothing beats seeing your kid react to the world of sound for the first time.

Let me give you the basics of this therapy. So, imagine the sensory hair cells in your ear as a team of tiny dancers. They groove to the vibrations of sound, signaling to your auditory nerve and ultimately your brain.

Kids with this specific genetic hearing loss have the dancers, but they're out of sync – they can't communicate that signal to the brain. DB-OTO is like giving these dancers a choreographer, delivering the missing otoferlin protein, and restoring the signal transmission.

Actually, DB-OTO isn't entirely a Regeneron creation. They snagged it up when they acquired Decibel for $109 million in 2023. But this wasn’t a hostile takeover – these two companies had been working hand-in-hand on DB-OTO since 2017, making the deal a no-brainer. Heck, Regeneron even brought over the team behind the project to keep things running smoothly.

And as it turns out, Regeneron and Decibel didn't have to reinvent the wheel (or the eardrum) with their delivery method.

They took a page from the cochlear implant playbook, making it easier for ear, nose, and throat docs (ENTs) to jump on board when this therapy eventually hits the market. They figured that they could just take this groundbreaking technology and make it work with techniques surgeons already know like the back of their hands. Smart move, right?

One unexpected twist? The family noticed the kid's voice sounded less harsh without the cochlear implant.

Now, that's not a hard data point, but it hints that DB-OTO might offer something unique: a more natural hearing experience compared to cochlear implants, which tend to have a robotic sound that takes some getting used to. Cochlear implants bypass the ear altogether, zapping the auditory nerve directly. Effective, sure, but not exactly the most elegant solution.

It's not just about regaining hearing – it's about unlocking a child's world. Regeneron’s ASGCT presentation showcased patient 1's incredible journey: responding to sounds at 3 weeks, meaningful sounds by 6 months, and even hearing with the cochlear implant turned off at 24 weeks.

A second 4-year-old patient is also showing promising signs, with improved hearing at the same early time points. Side effects? Nothing more than a common ear infection, which was easily treated.

But this wasn't an overnight miracle. Regeneron and Decibel brainstormed this idea six years ago, putting their heads together to figure out where they could make a real difference. They seem to have found their niche.

And they didn't just buy one therapy – they snagged a whole pipeline of possibilities. There's AAV.103 for a different type of hearing loss, and AAV.104 for another genetic form. They're even tackling balance issues, because apparently, ears do more than just listen. These additional therapies fit into Regeneron's broader strategy of becoming a leader in the auditory space.

Next, let's talk dollars and cents, shall we?

Regeneron shelled out $213 million (if you include those fancy CVRs) for Decibel. That's a hefty bet, but they're banking on DB-OTO getting regulatory approval in multiple countries by 2028. Ambitious? Absolutely. But the potential payoff for patients – and investors – could be worth it.

As expected, Regeneron's not the only one with their stethoscope in this growing market.

Eli Lilly (LLY) wasn't far behind, scooping up Decibel's rival Akouos for a whopping $487 million in late 2022. Plus, they're also gunning for that otoferlin gene therapy prize.

And don't forget Fennec Pharmaceuticals (FENC), who snagged FDA approval for their chemo-induced hearing loss treatment last year. Looks like everyone wants a slice of this pie.

Now, for the data geeks (I know you're out there).

Regeneron's Q1 results were a tad underwhelming for Wall Street, with EPS at $9.55 (below the $10.17 estimate) and revenue dipping slightly to $3.15 billion, mostly due to the COVID drug Ronapreve drying up.

But take that out of the equation, and revenue actually grew 7%. Not that bad.

And there's good news elsewhere. Sales of Dupixent and Libtayo are soaring, up 24% and a whopping 45% respectively. That's where the future lies.

Sure, they've had some bumps in the road (the FDA rejecting odronextamab wasn't ideal), but their Eylea HD launch is gaining steam, with $200 million in sales already.

These successes, coupled with the potential of DB-OTO and the other auditory therapies, paint a promising picture for Regeneron's future growth.

So, what should you do? Keep your eyes on their pipeline, especially those new oncology and weight-loss treatments. And with a $3 billion stock buyback plan, Regeneron's showing they're confident in their future.

This might not be a slam dunk, but it's a bet on a company that's not afraid to swing for the fences in the biotech game. With a strong pipeline, a track record of innovation, and the financial muscle to back it up, Regeneron is positioning itself to be a major player in this growing market.

For those willing to ride out the bumps, the long-term payoff could be music to their ears.

May 7, 2024

Biotech Letter

Mad Hedge Biotech and Healthcare Letter
May 7, 2024
Fiat Lux

Featured Trade:

(PACKING A HEAVIER PUNCH)

(AMGN), (NVO), (LLY), (REGN)

Packing A Heavier Punch

Biotech Letter

Amgen (AMGN) is having a moment. Early results for their injectable drug MariTide sound pretty darn promising.

But it’s not all roses and sunshine at Amgen. The company also dropped the curtain on AMG786, an experimental oral weight-loss pill that just wasn't cutting it.

It’s tough in the pharmaceutical arena, especially since this whole weight-loss drug market is a gold rush right now. Eli Lilly (LLY) and Novo Nordisk (NVO) are cleaning up, and even Pfizer (PFE), despite their hiccup, isn't going to roll over that quickly.

Now, back to MariTide. Calling it a "multi-blockbuster" sounds flashy, but investors want to see if it can crack the hold those big two already have. Amgen's got a decent track record though, so I wouldn't write them off just yet.

The early scoop on MariTide is pretty tantalizing. The last round of Phase 2 trials showed that three monthly shots could significantly trim the waistline, with the heftier doses keeping the pounds off for up to four months post-treatment.

Actually, MariTide’s core strength is that it’s just once-a-month jab — an easier regimen compared to the weekly routine required by current front-runners like semaglutide and tirzepatide.

Speaking of the competition, Novo Nordisk’s semaglutide and Eli Lilly’s tirzepatide have been seeing users pack the pounds back on pretty quickly after stopping treatment.

That’s not ideal, and it’s exactly the kind of opening Amgen is looking to capitalize on with MariTide.

Now, let’s broaden our scope. It's a bit of a misnomer to just call it an “obesity pipeline” because, let me tell you, this technology is dipping its toes into much more than just shedding pounds.

Those GLP-1 agonists like semaglutide and the double-duty “double G” agonists like tirzepatide? They’re not just one-trick ponies.

Aside from battling the bulge, they’re making waves in treating diabetes, slicing through cardiovascular risks, and even exploring new frontiers like osteoarthritis and sleep apnea.

Heck, they’re even peeking into Alzheimer’s prevention — Novo Nordisk is already revving up for a phase 3 trial.

Despite these lucrative offshoots though, obesity remains the arena’s juggernaut.

Novo Nordisk’s latest data, as bleak as it might seem for global health, paints a picture of a market vast enough to entice anyone. Think about it—out of 813 million people wrestling with obesity, only one million are currently on these incretin drugs.

And with projections pointing to numbers ballooning to 1.2 billion by 2030, well, the potential market is jaw-dropping.

If Amgen’s MariTide hits the mark, we could be talking about a whopping $20 billion in annual sales from just this one contender in about 7-8 years, spanning obesity and a few neighboring conditions.

That’s even if they face a dogfight over pricing and if the average price per patient hangs below what the big guns like Novo Nordisk and Eli Lilly are currently pulling.

Now, think about this — current estimates peg Amgen’s growth from $33 billion this year to a modest $35.1 billion by 2033. My take? That’s wildly conservative.

If you ask me, Amgen's obesity pipeline alone, even with just modest success, could blast those numbers out of the water.

But let's not kid ourselves – MariTide alone won't make Amgen king of the obesity market. To truly capitalize on the segment’s potential, Amgen might need to consider teaming up with those emerging stars working on preserving lean body mass, or even big players like Regeneron (REGN).

They could take a couple of routes here. One slick move could be scooping up some smaller biotech firms or cozying up to bigger fish through partnerships or in-licensing deals to beef up their treatment options.

Alternatively, Amgen could play it cool and simply pair MariTide with their own upcoming products once they hit the market. Sure, this might keep things simple, but it kind of feels like leaving money on the table, isn’t it?

Admittedly, it’s still early days when it comes to these weight loss treatments. One thing's for sure: the next few years will be a wild ride for obesity drugs. After all, it’s clear that the GLP-1 craze is doing for pharma what AI hype is doing for tech stocks. It’s like a rising tide lifting all boats.

Looking ahead, the big winners in the next 18 months are looking to be Novo Nordisk and Eli Lilly. These guys are leading the pack, while others might just not make it to the finish line, ending up as flops in the stock market drama.

Yet, through all this, Amgen stands out as a dark horse.

Even if the obesity pipeline doesn't turn out to be their golden ticket, Amgen's strategic positioning could still deliver solid long-term value.

But, and here’s the kicker, if MariTide and its potential combo treatments hit their stride as hoped, Amgen could sprint ahead in this fast-paced market race — not just in obesity but in those juicy, adjacent niches too. This could spark some serious value creation that current forecasts haven't even begun to factor in.

So, while the market’s getting its gears grinding, Amgen might just surprise us all. I say keep this stock on your watchlist.

February 8, 2024

Biotech Letter

Mad Hedge Biotech and Healthcare Letter
February 8, 2024
Fiat Lux

Featured Trade:

(THE WEIGHT IS OVER)

(REGN), (NVO), (LLY), (RHHBY)

The Weight Is Over

Biotech Letter

Let's look into something that's been buzzing in the healthcare sector, and no, I'm not just talking about the latest diet fad. I’m talking about obesity treatments — specifically, those groundbreaking drugs that are reshaping the market and, quite literally, the patients using them.

Yes, I'm looking at you, GLP-1 agonists. These bad boys have been making waves for their significant role in weight loss, but let's face it, there's always room for a bit of an upgrade, right?

Despite all the cheers and positive vibes around GLP-1 agonists, a little detail has been creeping up that's somewhat less than ideal — muscle loss.

It turns out, up to a whopping 40% of the weight shed isn't just fat saying goodbye, but muscle bidding adieu as well. Not exactly the parting gift patients were hoping for, and frankly, it's stirring up some concerns that could ripple through public health in the not-so-distant future.

This is where Regeneron (REGN) comes in.

This biotechnology company isn’t new to the scene, but it’s taking a fresh angle on the whole ordeal. Their game plan? A dynamic duo approach, combining trevogrumab or garetosmab with the well-known semaglutide (hello, Wegovy), aiming to refine the weight loss journey for those embarking on it.

Regeneron’s goal is clear: let's keep the muscle, lose the fat, and change the narrative on obesity treatments.

Now, for a little context, the obesity treatment arena has been somewhat monopolized by Novo Nordisk (NVO) and Eli Lilly (LLY), with their respective champions, Wegovy and Zepbound, leading the charge.

But here's where Regeneron is looking to carve out its niche, not just in improving the now but in eyeing the future post-treatment landscape. The million-dollar question they're tackling: once the weight's off, how do you keep it from coming back without those weekly jab appointments?

To know the answer to that question, I suggest you mark your calendars for May 2024 because that's when the magic starts. It will commence Phase 2 of the study aiming to test Regeneron’s combo and hopefully offer better results to the weight loss game.

Ultimately, the company aims to preserve, or even boost, muscle mass. Imagine that, weight loss without the unwanted goodbye to your gains.

While it's worth noting that while Regeneron is making waves with its innovative approach, they're not alone in the quest for muscle preservation. Other players are also in the mix, each with their own strategies to combat the side effects of GLP-1 agonists.

Roche (RHHBY), for instance, has set its sights on combining their anti-myostatin antibody with incretin treatments, expanding the battlefield into new territories.

However, Regeneron’s plans don’t end in the weight loss world.

Earlier this month, Regeneron threw another curveball with the acquisition of 2seventy bio's cell therapy pipeline. This move isn't just about expanding their arsenal; it's about integrating and innovating in ways that could redefine cancer treatment as we know it.

By blending Regeneron's antibody expertise with 2seventy's cell therapy prowess, they're transforming into a potential oncology powerhouse.

Now, let's look at the numbers. Regeneron's market cap is flirting with the $100 billion mark, proof of their performance and potential. With revenues dancing around the $13 billion mark for 2023 and a price-to-sales ratio that's eye-catching, to say the least.

Yet, with every high, there's a looming challenge. The patent cliff for Eylea, their golden goose, is on the horizon, threatening to shake up the status quo.

But if there's one thing Regeneron has shown us, it's their knack for innovation. Given everything the company has embarked on over the past months, it’s safe to say that they’ve got this issue covered.

Does that mean it’s time to yell "screaming buy" from the rooftops? I usually keep such big words under lock and key, but Regeneron? They're onto something. They're not just surviving; they're plotting a course to new horizons without putting all their eggs in one basket. That strategy? It's more than just good—it's golden.

So while the cautious among us might wait for the market to blink first, there's something to be said for getting ahead of the curve. After all, in the world of pharma, timing is everything, and Regeneron seems to have its clock set just right.

January 30, 2024

Biotech Letter

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

Featured Trade:

(BRAIN GAINS)

(BIIB), (ESALY) (LLY), (REGN), (ALNY), (MRK), (AMGN), (PFE), (BMY)

Brain Gains

Biotech Letter

Let's talk about a golden opportunity knocking at our doors – the booming market of Alzheimer's disease treatments in biopharma. We're not just talking about a small uptick here. With a slew of new meds on the horizon, this market is gearing up for some serious growth, and you might want to grab a piece of this pie.

The dominant name on our radar is Biogen (BIIB), ticking at $260 per share with a market cap that's flirting with $39 billion.

Now, with a solid $10 billion in sales and trading at a nifty 16 times its 2024 estimated earnings, Biogen's got some serious mojo. I've been eyeing it since last year, but boy, have things changed since then.

A critical game-changer was Chris Viehbacher, the new CEO since November 2022. He's already played a couple of aces – slicing $800 million in costs (which, by the way, could pump up earnings by $5 a share by 2025) and wrapping up the acquisition of Reata Pharmaceuticals in September 2023.

This new addition to Biogen’s portfolio has a hot ticket item, Skyclarys, for treating Friedreich’s ataxia. It's a rare find, but it could add a cool $5 per share in earnings in a few years.

But the most exciting name in Biogen’s arsenal is Leqembi, the company’s Alzheimer’s treatment. They're splitting the pot with Eisai (ESALY), and this drug is a little like turning back the clock on cognitive decline – think a two-year rewind button.

The big bucks talk here: we're eyeballing $2 billion in revenue by 2028 and maybe a whopping $4 billion by 2033. And hey, there might even be more where that came from.

Let's chew on a few things here. Biogen has the potential to snag a 60% market share against Eli Lilly’s (LLY) donanemab – the only worthy opponent in the market so far. And given Leqembi's safety creds, this might be playing it safe.

Aside from Eli Lilly, there’s Roche (RHHBY), with candidates in Phase 2 and Phase 1 trials, but they're not quite hitting the jackpot yet. As for other competitors in the space like Regeneron (REGN) and Alnylam (ALNY)? Well, they're cooking up something different in Phase 1, but it's a bit early to call.

Meanwhile, Biogen's got another trick – a home-use version of Leqembi coming this fall. And get this: doctors are buzzing about nipping Alzheimer’s in the bud, way before it crashes the party. Imagine getting a jab of Leqembi as part of your routine check-up when you're only 50. If this works, then we could be kissing Alzheimer’s goodbye by 2040.

For the longest time, Biogen was like that one-hit wonder with its multiple sclerosis treatments. But now, they're swinging for the fences with the largest unmet health need out there. If Leqembi hits it big, and I mean really big, we could be talking about sales far beyond that $4 billion mark by 2033.

But let's not get ahead of ourselves. The big pharma world is about to hit a few speed bumps with a wave of patent cliffs from 2025 to 2029. That’s a headache for the likes of Merck (MRK), Amgen (AMGN), Pfizer (PFE), and Bristol Myers Squibb (BMY).

Biogen, though, is sitting pretty with two growth products and a pipeline that’s got pizzazz. Plus, they're a hot catch for any big pharma looking for a dance partner without stepping on regulatory toes.

As we roll into the next decade, keep your eyes peeled for investment opportunities popping up like daisies. And don't feel like you've got to jump on the first bandwagon that rolls by. This market's just stretching its legs, and today's champs might just be tomorrow's old news.

So, what's the smart play here? Spread your bets across a few horses in the Alzheimer's race, and make sure they're not one-trick ponies.

Eli Lilly, for instance, is more than just an Alzheimer's bet – they're making waves in diabetes and soon, obesity treatments. Biogen, despite its Alzheimer's experience, is a bit of a gamble, especially after its first drug's rocky start.

Remember, investing in Alzheimer's treatments now is like catching the early wave – it's riskier, sure, but the potential for a big payoff is there. This is an emerging market, and it's revving up for an exciting ride. I suggest you add these names to your watchlist.

December 14, 2023

Biotech Letter

Mad Hedge Biotech and Healthcare Letter
December 14, 2023
Fiat Lux

Featured Trade:

(EDITING YOUR PORTFOLIO)

(CRSP), (VRTX), (BLUE), (BEAM), (CRBU), (EDIT), (NTLA), (PRME), (VERV), (LLY), (REGN)

Editing Your Portfolio

Biotech Letter

In the world of biotechnology, the buzz these days is all about gene editing – a frontier that’s moving at warp speed.

While the journey from sequencing the first human genome took a staggering 13 years, companies like CRISPR Therapeutics (CRSP) have sped up the process, bringing their revolutionary "molecular scissors" concept to market in a mere decade.

It's a thrilling time for investors, with the potential for staggering returns, but the path is littered with clinical and regulatory landmines. This turns choosing the best stocks to put your money into a tricky challenge.

Recently, the FDA gave the green light to two groundbreaking gene therapies for sickle cell disease, developed by Vertex Pharmaceuticals (VRTX) in collaboration with CRISPR Therapeutics and by Bluebird Bio (BLUE).

This disease, predominantly affecting African-American communities in the U.S., has been a target for medical advancement for years.

While the approval is a landmark, it's not without its tremors. Bluebird Bio's stock took a nosedive by 33.9%, triggered by the FDA’s warning label about potential cancer risks linked to their treatment.

In contrast, the treatment by Vertex and CRISPR dodged such warnings, possibly giving it an edge in the eyes of prescribing doctors.

And then there’s the money side of things. Bluebird Bio missed out on a priority review voucher from the FDA, which they were hoping to sell to Novartis for a cool $103 million. That's a tough break.

Meanwhile, the Vertex and CRISPR therapy, now known as Casgevy, boasts the honor of being the first FDA-approved drug using the trailblazing Crispr/Cas9 technology. It's a Nobel Prize-winning innovation that's finally reaching the patients it promises to help.

The approvals of Casgevy and Bluebird Bio’s Lyfgenia, which arrived earlier than expected, mark a significant moment for patients with sickle cell disease.

Although priced in the millions, these treatments offer a potential one-time cure, replacing the traditional, complex regimens. Unfortunately, they are not without their challenges, involving intensive procedures, lengthy hospital stays, and chemotherapy.

This brings us to the investment side of things.

The gene-editing arena is brimming with potential, but it's akin to navigating a labyrinth. With no specific exchange-traded funds (ETFs) focusing solely on gene editing stocks, investors might feel like they're trying to find their way in the dark.

However, a diversified approach could be the lantern in this darkness.

Companies like Beam Therapeutics (BEAM), Caribou Biosciences (CRBU), Editas Medicine (EDIT), Intellia Therapeutics (NTLA), Prime Medicine (PRME), and Verve Therapeutics (VERV) are some of the key players in this space, each with its unique technological platform.

But it's not just the pure-play gene editors that are worth your attention. Giants like Eli Lilly (LLY), Regeneron Pharmaceuticals (REGN), and Vertex Pharmaceuticals have thrown their hats into the ring, making substantial investments in gene editing.

So, how should you play this? If it were my money, I'd spread it around.

Put a chunk in leaders like CRISPR and Intellia. Then, combine these with established players like Eli Lilly, Regeneron, and Vertex to provide a safety net, balancing out the inherent risks of this high-stakes biotech game.

On the other hand, companies like Beam and Verve, representing the next wave of this technology, should not be overlooked, though perhaps with a more conservative stake.

And here's a little hedge for you: keep an eye on smaller players like Caribou Biosciences and Editas Medicine. In this high-stakes game, they could be your ace in the hole.

The gene-editing industry is a roller coaster of innovation, risk, and potential. It's a sector where fortunes can be made and lost in the blink of an eye.

For the savvy investor, a diversified, strategic approach, blending the bold with the stable, could be the key to unlocking the vast potential of this exciting field.

Remember, as with any investment, the key is not just in choosing the right horses but knowing how to spread your bets across the race.