Football season is getting started this week, and I’m pumped. This is the time millions of people test their wits against friends (and strangers) in fantasy football. For fellow biotech nerds who aren’t familiar, this is a little bit like the stock market—you try to pick a diversified portfolio of pro football players who you think are going to have great seasons. And you try to avoid the losers.
Since I just finished drafting my fantasy team, I thought it would be fun this week to evaluate biotech a bit like I analyze football players. So here goes, with a somewhat tongue-in-cheek set of awards and predictions about the ups and downs to watch this season among the companies, players, and drugs that make biotech so darn interesting.
Reggie Bush don’t-believe-the-hype award: Brisbane, CA-based Intermune (NASDAQ: ITMN). The former Heisman Trophy winner from USC had a dazzling college career, but has been a dud in the pros. Intermune, too, saw a monster wave of enthusiasm earlier this year, and its stock briefly topped $50 in April. The company has already dropped back into the mid-$20s, but it still has a market valuation of about $1.5 billion. All of this excitement has been for one new drug that was rejected by the FDA, and then approved in the European Union for patients with idiopathic pulmonary fibrosis. It all looks to me like investors have gotten carried away. This disease is a rare condition, Intermune is blazing a new trail on its own with physicians and patients, and quite a few European countries are basically broke.
LaDainian Tomlinson fading superstar award: Amgen’s erythropoietin anemia drug franchise. The future Hall of Famer did amazing things for the San Diego Chargers, but now he’s 32, near the end of his career. He’s given up the starting tailback job with the New York Jets to Shonn Greene, which means LT won’t have to carry the load all by himself, which could lengthen his career. Thousand Oaks, CA-based Amgen (NASDAQ: AMGN) had a similarly spectacular run with its erythropoietin anemia drug franchise, but after battling years of safety controversies, this product’s best years are behind it. Fortunately for Amgen, it has the equivalent of Greene’s fresh legs with its new antibody drug denosumab, which it is marketing as Prolia for osteoporosis and Xgeva for cancer-related bone loss. But just like Shonn Greene is no LT, d-mab is no EPO.
Packers-Bears best rivalry: Vertex-Merck. The Green Bay Packers and Chicago Bears have the oldest and one of the most intense rivalries in football, and there are few things I enjoy more than watching my World Champion Packers beat the Bears. I don’t have a rooting interest in the battle between Vertex Pharmaceuticals and Merck in the hepatitis C field, but this has the elements of a great rivalry. Vertex has superior data for its drug from clinical trials, but Merck’s drug is also a big step up over the old hepatitis C regimen, and it has money, manpower, and sales history with doctors that can’t be dismissed. To add another layer of intrigue, Vertex founder Josh Boger and CEO Matt Emmens both worked earlier in their careers at Merck, so these are familiar enemies.
Tom Brady sleeper pick of the year: Richmond, CA-based Sangamo Biosciences (NASDAQ: SGMO). The legendary 3-time Super Bowl-winning quarterback was the ultimate sleeper pick coming out of college, and the New England Patriots were able to grab him in the sixth round of the 2000 draft. Sangamo has been around for a long time with a technology for specifically silencing genes, which investors aren’t giving much value. But Sangamo is expecting some clinical trial results this fall from a mid-stage clinical trial of its new drug for patients with diabetic neuropathy. If the data are positive, it could propel this company from the bench to stardom.
Tedy Bruschi comeback player of the year: South San Francisco-based Exelixis (NASDAQ: EXEL). The former Patriots linebacker and 3-time Super Bowl champion suffered a rare heart condition that caused a stroke, which looked like it would send him into retirement in 2005. But he beat the odds, coming back to play some more great football. Exelixis, too, looked like it was in big trouble just a year ago after it made some big layoffs, one of its partners (Bristol-Myers Squibb) threw in the towel on its lead drug candidate, and its CEO left for a new job. But Exelixis’ lead drug, cabozantinib, has shown an impressive ability to treat the debilitating bone pain that strikes men with advanced prostate cancer. Investors have heard researchers rave about this drug, and have pumped new life into the stock, which enabled Exelixis to raise a lot more money. Now Exelixis needs to prove the results in more rigorous studies, but it is certainly back in the game.
Baltimore Ravens defensive team of the year: The FDA’s division that reviews obesity and diabetes gets this award in a landslide. Like the NFL’s notoriously violent defender, Ravens linebacker Ray Lewis and his teammates, the FDA has … Next Page »
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