Biotech Industry

By pjain      Published July 18, 2020, 7:09 a.m. in blog Invest   

Biotech Sector

Major Biotechs


GILD R6 div$0.65 5yrHistoryOfRaisingDivs

Gilead Sciences US:GILD is the only stock on the Jeffries list that was up between Feb. 19 and March 20. The company is among 15 that are testing treatments or working to develop COVID-19 vaccines. Jefferies analyst Michael Yee likes Gilead as a defensive play with a strong balance sheet.

The only stock on the list that was up between Feb. 19 and March 20. The company is among 15 that are testing treatments or working to develop COVID-19 vaccines

  • FCF $8b/ttm

  • SEG: HIV and AIDS main

  • SEG Liver disease, hematology, and oncology

  • SEG: Cardiovascular issues

  • Cilofexor, Axicabtagene ciloleucel, Filgotinib, and GLPG-1690 are some of the company's key drugs that are in phase 3 of testing and that could be among its next products to hit the market.

  • Generic Version of HIV Prevention Drug Truvada Coming in Sep'2020 Developed by Gilead Pharmaceuticals, Truvada is used for HIV pre-exposure prophylaxis, or PrEP, and when taken daily can keep HIV-negative people from contracting the virus. The new generic version will come from a settlement agreement Gilead struck in 2014 with the Israeli-based company, Teva Pharmaceuticals. The generic version was supposed to arrive in 2021, but Gilead announced the new 2020 date in an SEC filing released today, May 8th. Gilead’s director for community engagement, Douglas Brooks, also sent a letter to “Colleagues” Wednesday that read, “Pursuant to a settlement agreement reached in 2014 … Teva will be able to launch generic fixed-dose combinations of emtricitabine and TDF … on September 30, 2020.”

Brooks also acknowledged President Donald Trump’s plan to make Truvada the cornerstone of a campaign to end HIV, as well as an ongoing dispute between Gilead and the Center for Disease Control over who actually owns the rights to the drug. “This agreement is not related to current discussions with the U.S. government to broaden access to Truvada for PrEP for vulnerable populations and support the federal plan to end the HIV epidemic,” he said.

Truvada was introduced in 2012 and, though it faced initial criticism from public health leaders and the LGBTQ community, attitudes towards the drug shifted as it proved to be a relatively success tool in HIV prevention. However, some studies showed that the populations most at risk of HIV infection were unable to access the drug. Truvada was also notoriously expensive in the United States: While a month’s supply could cost as little as $70 in some parts of the world, in the U.S. it could cost between $1,600 and $2,000.

In recent years, activists have mounted a “break the patent” campaign designed to make Truvada more accessible and affordable. The PrEP4All Collaboration released a statement Wednesday celebrating the news of the generic version, though they did so with plenty of caution. The group noted that Gilead will not only retain the rights to Truvada for another 15 months, but having one generic version “will do little to reduce the price in a way that will increase access.”

The statement, written by Dr. Aaron S. Lord, continued, “PrEP4All remains suspicious of the terms and lack of transparency surrounding the Teva settlement. I have to ask, what’s to stop them — other than a desire for profit margins — from releasing the rights now?”

PrEP4All also highlighted the ongoing dispute between Gilead and the CDC. In March, the Global Health Justice Partnership at Yale University revealed that the U.S. government provided most of the funding for Truvada, meaning the CDC could actually own the rights.

“The CDC must use the billions of dollars that the American people overpaid to create a national HIV prevention program, aimed at breaking down structural and systemic barriers that prevent the most at-risk communities from accessing the medication,” PrEP4All said. “Additionally, the CDC must use its significant leverage to ensure that generic Truvada is available at a price affordable to everyone in this country.”


It has developed a cancer therapy utilizing electric fields which disrupt cell division limiting cancer growth. The Company call their treatment “Optune” and it has FDA approval for the treatment of glioblastoma and mesothelioma. NVCR is based on Jersey, The Channel Islands, and has its major manufacturing sites in Germany and in the U.S. in New Hampshire. There are virtually no side effects from Optune except for minor skin irritation if the electrodes are misplaced. Sales are projected to grow at 30-40% per annum even without new approvals. There are excellent potential catalysts: a.Clinical testing for the treatment of non-small cell lung cancer has been very encouraging. B. Medicare will begin to cover treatments starting on September first . C. At first, there was much skepticism about this “science fiction” treatment, but doctors have slowly come to recognize that combined with chemotherapy Optune has considerably improved survival rates for glioblastoma and now the newly approved mesothelioma treatment.

AGN - acq

Allergan * one of 30 most favored by hedge funds



  • one of 30 most favored by hedge funds


• Reata pharmaceuticals - stock can be a ten bagger if it works. Has an experimental drug targeting kidney disease with good results. Can be a $25 billion company on $5 billion peak sales. Current market cap is $2.3 billion • Current data is so good that some people believe the data is fake • Some safety concerns on heart safety (now excluding patients with heart disease and slowly moving patients dose up) Since changes there have been no problems. No liver problems or any warning signs. No actual muscle loss. They think the safety profile is good SRC: Bihua Chen's Sohn'19 New York Presentation

Smaller Biotechs in Trials ~2006

Tessa Therapeutics ($80 million)

Tessa Therapeutics is a clinical stage biopharmaceutical company with the scientific vision of revolutionizing the treatment of cancer by redirecting the body’s potent anti-viral immune response to recognize and kill cancer cells. Tessa’s core virus-specific T cell (VST) platform has shown compelling results in the treatment of solid tumors, and the company is building a portfolio of therapies addressing a wide range of tumors by combining the qualities of its T cell platform with complementary technologies. Singapore

Alnylam Pharmaceuticals (ALNY)

In October, pharma giant Merck (MRK) agreed to buy Sirna for $1.1 billion, a staggering sum for a company very early in the drug development process (see, 10/31/06, "Merck's Big Play in RNA"). The reason? Sirna is one of only a few companies developing drugs based on RNA interference, a technology for which scientists won the Nobel Prize, that involves blocking gene expression. The company has only initiated an early-stage safety trial for its lead product candidate, a treatment for respiratory syncytial virus, but RNAi could be the bigger asset. Douglas Chow, an analyst with investment bank Caris, says, "I would compare it to the early stages of monoclonal antibodies technology in the early 1980s before people could figure out how to use monoclonal antibodies." He refers to another development, for which researchers also won a Nobel, that has provided the base of many approved treatments for cancers and other diseases, among them Genentech's (DNA) Avastin cancer therapy.

Affymax (AFFY)

During the past few months, investors have seen more than a few biotech companies stumble during their public offerings. Not Affymax (see, 12/15/06, "Affymax IPO Gets Investors' Blood Racing"). The company priced above its range in December and has a market valuation of almost $500 million. So why does this loss-making company appeal so much to a few investors? Among other factors, the company received funding from big-name venture capitalists like MPM Capital and Bear Stearns Health Innoventures. Another is potential sales. The company's hopes rest on Hematide, an erythropoiesis stimulating agent designed to treat anemia in patients with chronic kidney disease and for cancer patients undergoing chemotherapy. Anemia-fighting drugs are blockbuster sellers—generally defined as more than $1 billion-plus in annual sales—for Johnson & Johnson (JNJ) and Amgen (AMGN). And Affymax believes Hematide could be longer acting and cause fewer side effects than the existing products. The drug is in several mid-stage trials.

Jazz Pharmaceuticals (Filed for IPO)

Oftentimes investors find initial public offerings in biotech come along too early in a company's development before it has much encouraging data on its prospective compounds. Jazz Pharmaceuticals, which filed to go public earlier in March, could wait a little longer because it focuses more on acquiring and licensing drugs than on developing them from preclinical stages. The offering's underwriters include Morgan Stanley (MS) and Lehman Brothers (LEH). Jazz already markets a drug for the sleep disorder cataplexy, and excessive daytime sleepiness in patients with narcolepsy. By modifying known therapeutics and the methods by which they are delivered, the company also believes it can mitigate the risk of drug development. In January, the company licensed the U.S. marketing rights to Luvox CR, an extended-release version of the antidepressant, which Jazz hopes will win approval to treat obsessive-compulsive disorder and social anxiety disorder. If it succeeds, product rollout could come as early as next year.

Altus Pharmaceuticals (ALTU)

Altus' plan is to commercialize drugs that it modifies using its protein crystallization technology. It is pushing two leading product candidates. One is an oral treatment for nutrient malabsorption caused by an exocrine pancreatic insufficiency. The second is an injected treatment for growth-hormone deficiency that it is developing with Genentech. Cowen has an outperform rating on the stock. The firm likes Altus' business model of modifying drugs to treat rare diseases. (Cowen makes a market for and has a banking relationship with Altus.) But research outfit Morningstar is less enthusiastic. It rates the stock one star out of five. A recent report on the company says it believes both of Altus' lead candidates have promise if, of course, they win approval. It adds that the company "does not appear to provide a viable commercial alternative if either of the leading candidates fails."

Trubion Pharmaceuticals (TRBN)

Seattle-based Trubion develops drugs designed to bind to targets on cell surfaces. The lead product candidate, now in mid-stage trials, aims to treat rheumatoid arthritis, a market with blockbuster potential. The company believes it may also have use in treating lupus, though it has not yet begun clinical trials aimed at the disease.

Trubion carries all the usual biotech risks, but investors have warmed to the company anyway. The stock is up more than 50% since its October IPO. More than promising pills or potions, those who play biotech stocks may consider ever-optimistic investors as the sector's greatest asset.

Biotech Articles, Trends, Key Factors

Pipelines are Risky - Biotech for the Fearless, Inspired, Genius or Wildcatter Investors?

Maybe the only thing more nerve-racking than being a biotech investor is actually running one of the risk-laden outfits. Those who brave the category, especially the smaller companies, need to brace themselves for spikes—and precipitous drops—in their share prices based on clinical data results. The dramatic divergences were illustrated by the trading action in two stocks in recent days. On Mar. 26, investors saw shares in Alexza Pharmaceuticals (ALXA) soar more than 50% after the company released data on successful mid-stage trials for its migraine and schizophrenia drug candidates. The stock fell more than 11% over the next two days. On the other hand, Atherogenics (AGIX) plummeted 13.6% to close at $2.80 on Mar. 28 after poor late-stage data for a cardiac drug. That's down from more than $38 in November, 2004.

Biotechs IPO on promises and prayers - Needing $100m+ to get through trials

In biotech; the typical trajectory for privately funded concerns is to go public or get acquired to fund the drug development process. For these companies, quarterly earnings reports—basically a tally of their latest losses—are incidental compared with clinical data. As drugs advance through the development pipeline, clinical trials test for safety and then efficacy. Later they evaluate how an experimental drug compares to approved treatments. The entire process can consume more than a decade and cost $1 billion.

Outfits in the sector are testing products that are years away from hitting the shelves. Plenty will never make it. But hope springs eternal for biotech investors. Back in December, 2005, we assembled a list of promising, but risky, biotechs (see, 12/13/05, "Biotech Bets for the Fearless"). For those at home keeping score, four have done a very volatile version of treading water and one, Gilead Sciences (GILD), has performed very well. But it already had a major product on the market.


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