David Fuller and Eoin Treacy's Comment of the Day
Category - Technology

    BioMarin Transformative Gene Therapy Turns Goldman More Bullish

    This article by Bailey Lipschultz for Bloomberg may be of interest to subscribers. Here is a section:

    A deeper dive into the cost-effectiveness of BioMarin’s Roctavian, which is on track to become the first
    approved gene therapy for Hemophilia A, and physician awareness left Goldman’s Salveen Richter more bullish on the prospects for the “transformative” therapy. * #

    Boosts already Street-high PT to $218 from $172, as research suggests a two- to three-times larger prevalence pool than previously estimated

    ** Sees average gross price of $2m-$3m as cost-effective compared to prophylactic factor therapy or Roche’s Hemlibra

    * “Majority of physicians plan to prescribe the drug upon approval to ~30% of their eligible patients and see utility across all severity levels”

    * Expects rapid adoption with an industry specialist highlighting that recent announcements by various payors for coverage of gene therapies bodes well for Roctavian

    * A decision from FDA is due Aug. 21 * BMRN shares are up 63% in the past year compared to a 30% gain for the Nasdaq Biotech Index

    * NOTE: Aug. 4, BioMarin Second Quarter Loss Per Share Wider Than Estimates
     

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    Platinum Quarterly Presentation Q1 2020

    This report carries a great deal of relevant information for the platinum market. Here is a section:

    Automotive demand down only 17% (-132 koz) YoY despite a 24% fall in Q1 light global vehicle sales

    Tightening global emissions standards, driving higher pgm loadings, partially counters lower auto sales/production

    W. Europe diesel share decline slowed on increased diesel sales

    Diesel vehicles still key for automakers to avoid or reduce heavy CO2 fines

    German diesel car market share continued to recover (Q1’20 average 35%, up 1.3% over 2019 average)

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    Email of the day - on returning customers

    Dear Eoin and team, I would like to thank you very much for the big difference you have made to my confidence in advising my clients, since I re-joined the service. If only I could find a way of explaining the benefit to my professional contacts! All the very best

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    Moderna Wants to Transform the Body Into a Vaccine-Making Machine

    This article by Robert Langreth and Naomi Kresge for Bloomberg may be of interest to subscribers. Here is a section:

    The excitement around mRNA goes beyond the pandemic. Proponents hope it can become a wide-ranging platform that will lead to vaccines for other difficult-to-treat infections, as well as customized cancer shots and even heart disease treatments. “It’s a big moment for mRNA therapeutics in general, because now it’s a household word and everybody knows about it,” says Derrick Rossi, a stem cell biologist who was a co-founder of Moderna in 2010 but is no longer affiliated with the company. “For Moderna, it’s the first time on the global stage.”

    Interest in using genetic material to turn the body’s cells into vaccine factories dates to a series of experiments in the early 1990s. In 1993 researchers at Merck & Co. injected lab mice with loops of DNA that contained instructions for influenza proteins. To the surprise of the scientists, the mice generated an immune response that protected against the flu. The concept, so elegant it seemed almost too simple to be true, produced a surge of excitement among vaccine experts.

    But though DNA vaccines worked in animals, they weren’t successful in initial human trials. It was difficult to get sufficient amounts of DNA into human cells, and when scientists overcame that, the vaccines turned out to be less potent than needed. (They were tried on the most challenging diseases, including HIV.) Over the years research into DNA vaccines has continued, but none has made it to market for humans. Inovio Pharmaceuticals Inc., a dark horse in the Covid-19 vaccine race, is testing a DNA-based approach. It uses a hand-held device to zap the skin with electric pulses after an injection, opening up holes in cell membranes to allow in more DNA.

    A few lonely scientists pursued mRNA therapies for years. In 2005, University of Pennsylvania researchers Katalin Kariko and Drew Weissman found that a slight modification to the mRNA molecule could reduce the immune reaction, making it much more amenable for use in drugs or vaccines. (Since then, scientists have found ways to reduce mRNA’s other vulnerability inside the body, protecting it from enzymes by encapsulating it in lipid nanoparticles.)

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    Time for Thinking

    Thanks to a subscriber for this memo by Howard Marks which may be of interest. Here is a section:

    The first is that many investors have underestimated the impact of low rates on valuations.  In short, what should the stock market yield?  Not its dividend yield, but its earnings yield: the ratio of earnings to price (that is, p/e inverted).  Simplistically, when Treasurys yield less than 1% and you add in the traditional equity premium, perhaps the earnings yield should be 4%.  That yield of 4/100 suggests a p/e ratio (the inverse) of 100/4, or 25.  Thus the S&P 500 shouldn’t trade at its traditional 16 times earnings, but roughly 50% higher.

    Even that, it’s said, understates the case, because it ignores the fact that companies’ earnings grow, while bond interest doesn’t.  Thus the demanded return on stocks shouldn’t be (bond yield + equity premium) as suggested above, but rather (bond yield + equity premium - growth).  If the earnings on the S&P 500 will grow to eternity at 2% per year, for example, the right earnings yield isn’t 4%, but 2% (for a p/e ratio of 50).  And, mathematically, for a company whose growth rate exceeds the sum of the bond yield and the equity premium, the right p/e ratio is infinity.  On that basis, stocks may have a long way to go.

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    Navy's solar power satellite hardware to be tested in orbit

    This article by Sandra Erwin for Spacenews.com may be of interest to subscribers. Here is a section:

    The 12-inch square tile module will test whether power can be harvested from its solar panel and transform the energy to a radio frequency microwave. The experiment has been in the works for more than a decade.

    The module converts sunlight for microwave power transmission. Depuma said engineers decided to not use optical power transmission because a lot of energy would be lost through clouds and atmosphere.

    The Naval Research Laboratory said the results of the experiment could drive the design of a dedicated spacecraft to test the transmission of energy back to Earth. The Pentagon is interested in this technology to provide energy to remote installations like forward operating bases and disaster response areas.

    Researchers believe that a space solar system traveling above the atmosphere would catch far more energy than it would be possible on the ground due to the abundant and unimpeded sunlight in space.

    One of the concerns is the thermal performance of the hardware. “It’s kind of a tricky problem to have something that’s in direct sunlight all the time and maintain the temperature of the electronics,” said Jaffe.

    Solar power satellites could provide energy anywhere in the world, he said. “So a really important component of these kind of satellites would be a device that can convert the sunlight into microwaves or some other form of electromagnetic energy that’s suitable for sending to Earth. Now is the time to test it in space and see how it performs.”

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    Biogen Soars After Alzheimer's Drug Gets Priority FDA Review

    This article by Timothy Annett and Bailey Lipschultz for Bloomberg may be of interest to subscribers. Here is a section:

    Aducanumab, a so-called monoclonal antibody designed to target amyloid plaque in the brain, has been one of the most closely watched drugs in development for years. Biogen at one point halted research on it after getting disappointing results, only to revive the drug in a reversal that surprised scientists and investors and raised the hopes of patients and families.

    The drug and the stop-start study process have been viewed skeptically by some. Data presented in December at the Clinical Trials on Alzheimer’s Disease conference in San Diego showed conflicting findings, with one trial suggesting the drug could be the first-ever to slow the progression of Alzheimer’s. But a second, essentially identical trial showed no effect on the disease at all.

    Alzheimer’s is a progressive disease that most commonly arises in people over age 60. It robs patients of their memories and their minds, causing impaired speech and thought. More than 5 million Americans are living with the disease, according to the most recent data from the U.S. Centers for Disease Control and Prevention, and more than 14 million are expected to suffer from it by 2060.

    With no medications currently available to slow the progression of the disease, demand for a therapy like aducanumab would be substantial. The next focus for investors will be a meeting of outside
    advisers to review the results generated by Biogen. Stifel analyst Paul Matteis said the briefing documents released prior to the panel are expected to be “a bigger determinant than usual
    in dictating how panelists eventually vote” and called the panel the highlight of 2020 and 2021 for health-care investors.

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    Lightweight-banking via messaging services are getting Gen Z buzz

    This article by Mike Butcher for techcrunch.com may be of interest to subscribers. Here is a section:

    They are not alone. Other players in the “banking services via a messaging” space include Kotak Mahindra Bank in India (on WhatsApp) and ICICI in WhatsApp (India). However, neither of these can do actual provisioning of the card and addition to Apple Pay and Google Pay in the messengers, which is what Zelf can do.

    With Zelf, users get an account and a virtual card via their Facebook Messenger, WhatsApp, Viber and Telegram accounts. For offline and online purchases Zelf supports Apple Pay and Google Pay. This lightweight onboarding means card issuance takes less than 30 seconds via a Passport or national ID. Users then get a virtual Mastercard debit card available in their favorite messenger app. Operating inside the EU’s “Single Euro Payments Area” means it’s pretty easy for the startup to scale its offering to other countries.

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    The Baupost Group Letter

    Thanks to a subscriber for this letter by Seth Klarman and team. Here is a section focusing on appetite for risk:

    Fed policy has been magnificently successful in achieving its objectives not only of lifting securities prices but also of altering investor behavior. The Fed wanted to influence buyers of securities to be bolder in their pursuit of return. The head of a major pension fund recently authored a piece describing how the fund had responded to lofty markets and low yields on safe debt instruments. Their reaction was not to lower the fund’s currently aggressive 7% risk-adjusted return objective to a more realistic threshold, but instead to direct more assets into “lower volatility” private investments while leveraging the portfolio. Private investments, of course, have the same underlying risk and inherent volatility as public investments – though because they are not publicly traded, their intermittent and privately determined appraisals may make them appear to be less volatile. And as for the choice to leverage up, we can only note that leverage is a double-edged sword that enhances returns in good times while sinking them in down markets. If markets falter, this fund will have not solved its problems but rather have multiplied them.  

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    NZ to trial world-first commercial long range, wireless power transmission

    This article by Loz Blain for newatlas.com may be of interest to subscribers. Here is a section:

    Emrod currently has a working prototype of its device, but will build another for Powerco, with plans to deliver by October, then spend several months in lab testing before moving to a field trial. The prototype device will be capable of delivering "only a few kilowatts" of power, but can easily be scaled up. "We can use the exact same technology to transmit 100 times more power over much longer distances," said Emrod founder and serial entrepreneur Greg Kushnir. "Wireless systems using Emrod technology can transmit any amount of power current wired solutions transmit."

    The system uses a transmitting antenna, a series of relays and a receiving rectenna (a rectifying antenna capable of converting microwave energy into electricity). Each of these components appear in these images to simply look like big ol' squares on poles. Its beams use the non-ionizing Industrial, Scientific and Medical band of the radio spectrum, including frequencies commonly used in Wi-Fi and Bluetooth.

    Unlike Tesla's globally-accessible free power dream, the power here is beamed directly between specific points, with no radiation around the beam, and a "low power laser safety curtain" immediately shuts down power transmission before any object, like a bird, drone, power thief or helicopter, can touch the main beam. There will be no difficulties this time working out where to place the meter.

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