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It cracks me up that you go by Helen’s forecast when it suits your claim at the same time you discredit her forecast of $1 billion in royalty by 2027. She has not only reiterated this forecast over and over again, but in fact at Evercosre ISI she indicated that $1 billion won’t the the peak royalty for halozyme.
… furthermore, you projections for Darzelex is way off. It is projected to sell $17 billion by 2026.
https://pharmaintelligence.informa.com/resources/product-content/multiple-myeloma-a-growth-market-set-to-shrink-as-revlimid-generics-hit
You guys crack me up :) nice try!
Have you not heard of Opdivo? Don’t you know it’s in PHASE 3 trials with Enhanze?
It’s one of the largest franchises out there and projected to grow in sales to $11.6 million by 2026. Even if SC market is only 50%, this will translate to $232 million in royalties to Halozyme.
https://www.fiercepharma.com/special-report/top-20-drugs-by-global-sales-2019-opdivo
Opidivo combined with Phesgo, Faspro and Efgartogimod will easily exceed $1 billion. The rest of the programs already in trials will be icing on the cake.
Helen has always been very conservative and typically does not talk about specifics of future new partnerships. So when she mentioned psychiatric indications and small molecules, you know Halo is in advance talks for these brand new indications.
I get the sense that we are close to some major new partnerships. The psych indication will have huge TAM. She specifically mentioned that SC will improve patient compliance over daily pills.
Train will the station soon. I hope you got a ticket.
Canaccord Genuity's raised price target for Halozyme from $27 to $48 on 12/2/2021
https://stocktwits.com/MarketBeat/message/412620624
Agreed
She also mentioned psychiatric indications and alzheimer’s again. Something is definitely in the works. She mentioned interest in small molecules, eg. SC injections once every few months instead of taking pills on a daily basis.
Think depression or bipolar disorder and far better compliance.
Definitely listen to Helen’s fireside chat today. Importantly she said the 2027 $1 billion royalty revenue projection is NOT peak royalties. She said royalties will continue to grow past 2027 due to wave 5 and more. She can’t talk about the specifics of each contract but this new statement regrading 2027 should put concerns regarding patent expiration to rest. She emphasized the coformulation IP as one of the reasons 2027 won’t be peak royalty.
She specifically mention co-formulation patents with Roche and we know about J&J
We have now dropped to a market cap of 4.7b, PE ratio of 11.9 and Peg of 0.63. It makes good sense to postpone purchasing another platform and instead authorize more share buy backs immediately. They will not find another platform as good as Enhanze at these bargain prices. The return on equity for Halozyme is de-risked and far better than anything else out there. Anything similar to the power of Enhanze will be selling for much higher prices.
Halozyme should consider the following:
1- Disrupt the IV nutrition/electrolyte industry with subcutaneous (Enhanzed) nutritions,
https://www.vitamindrip.com
https://cleanmarket.com/pages/nutridrip-iv-vitamin-therapy?_gl=1*1acmcww*_gcl_aw*R0NMLjE2MzgyNzg3MzcuRUFJYUlRb2JDaE1JemNlNDQ1ZkE5QUlWRkJEbkNoMDMtZ2VHRUFBWUFpQUFFZ0pCUFBEX0J3RQ..&_ga=2.49495970.585179890.1638278737-1533467782.1638278737&_gac=1.49417106.1638278737.EAIaIQobChMIzce445fA9AIVFBDnCh03-geGEAAYAiAAEgJBPPD_BwE
https://resetiv.com/products/immune-defense?utm_source=google&utm_medium=ppc&utm_campaign=VEGAS_automated&keyword=iv%20infusion&utm_source=google&utm_medium=ppc&utm_campaign=VEGAS_automated&keyword=iv%20infusion&gclid=EAIaIQobChMI38-gjZjA9AIVeAutBh2K2gjiEAAYASAAEgJfuPD_BwE
2- Ask insiders to consider buying shares in the open market
3- Speed up new partnerships
Cramer said this morning in CNBC: “no one wants to get infused” and “no one wants the drip. Halozyme has the solution to the problem. $ halo
Let’s make it simple. Present value (PV) is the current value of a future sum of money or stream of cash flows given a specified rate of return. Halozyme’s current market cap is less than the sum of its after tax income (not sales and not revenue but the actual bottom-line) through 2028 (see the very conservative table below). These estimates are based on existing programs (commercial or trials) and do not include income potential from new partnerships or programs which we know with high degree of certainty Halozyme will have (they have had a few new programs every year for the past several years). It also does not include income past 2028. I hope they don’t get bought out but it would not be a surprise to me at this sexy of a bargain market cap.
Year After tax GAAP income ($millions)
2021 336
2022 392
2023 424
2024 508
2025 598
2026 765
2027 998
2028 1114
Sum of after tax income through 2028 is $5.1 billion.
Current market cap $4.97 billion.
This table is from the SA article dated Oct. 1, 2021. We know SA numbers are super conservative; for example SA 2021 after tax income was estimated at $336 million, whereas Halozyme guided it to be $380-390 million in their November earnings report (see page 30 of corporate presentation)
Mr. Market can be irrational for little while but not forever. Halozyme is an easy double from here.
Goldman Sacs picks Halozyme as the number one high-growth stock for rising rates in 2022
https://seekingalpha.com/news/3772060-goldman-picks-best-high-growth-stocks-for-rising-rates-in-22
Goldman picks best high-growth stocks for rising rates in '22: Alpha Tactics
Higher interest rates will be a defining characteristic of the markets next year and many high-quality stocks also have growth profiles that make them sensitive to rate changes, Goldman Sachs says.
In Goldman's equity outlook for 2022, Chief U.S. Equity Strategist David Kostin and team look at how investors need to looks at duration in growth.
"Growth stocks with high profit margins outperformed unprofitable growth stocks when real rates jumped in 1Q 2021, and profitable stocks should remain resilient if rates rise in 2022," Kostin says.
Stocks with high revenue projections and low profit or negative margins have long duration and vulnerable to rates.
"Stocks with valuations entirely dependent on future growth are vulnerable to a dramatic drop in price if rates rise sharply or revenue growth expectations are reduced," he says. "This latter risk was exemplified by the sharp underperformance of some notable high growth, low earnings companies following disappointing 3Q 2021 results and lowered forward revenue guidance."
Because interest rates are so low now, high-growth extremely profitable stocks trade at similar valuations to high-growth stocks with low profitability, he adds.
Goldman ran screens for strong revenue growth stocks with high and low margins. Both screens exclude Financials.
High margin. Russell 3000 (NYSEARCA:IWV) companies with market cap over $2B, consensus 2023 revenue growth over 15% and 2023 margins over 20%.
1.Halozyme Therapeutics (NASDAQ:HALO), consensus sales CAGR 2021-23 is 30%, consensus 2023 profit margin is 63%
2.Marathon Digital (NASDAQ:MARA), sales 105%, margin 51%
Mastercard (NYSE:MA), sales 18%, margin 47%
3. Riot Blockchain (NASDAQ:RIOT), sales 69%, margin 46%
MP Materials (NYSE:MP), sales 50%, margin 45%
4. United Therapeutics (NASDAQ:UTHR), sales 13%, margin 42%
5.Aspen Technology (NASDAQ:AZPN), sales 13%, margin 41%
6. Universal Display (NASDAQ:OLED), sales 20%, margin 38%
7. Harmony Biosciences (NASDAQ:HRMY), sales 52%, margin 37%
8. Marvell Technology (NASDAQ:MRVL), sales 20%, margin 35%
Low profit.
Russell 3000 companies with market cap above $5B, consensus 2023 revenue growth over 15% and 2023 net profit margins less than 5%.
DraftKings (NASDAQ:DKNG), consensus sales CAGR 2021-23 40%, consensus 2023 net loss $722M, consensus 2023 margin -29%
Snowflake (NYSE:SNOW), sales 62%, loss $694M, maring -24%
Nikola (NASDAQ:NKLA), sales 1,414%, loss $487M, margin -63%
Guardant Health (NASDAQ:GH), sales 32%, loss $377M, margin -60%
Lyft (NASDAQ:LYFT), sales 31%, loss $330M, margin -6%
Wix.com (NASDAQ:WIX), sales 22%, loss $328M, margin -17%
Smartsheet (NYSE:SMAR), sales 29%, loss $254M, margin -29%
Pacific Biosciences (NASDAQ:PACB), sales 41%, loss $250M, margin -96%
Bill.com (NYSE:BILL), sales 50%, loss $244M, margin -28%
Oak Street Health (NYSE:OSH), sales 51%, loss $244M, margin -7%
You don’t have to trust the SA author, you can simply look up the following 2 patents
U.S. Patent 10,385,135 has been granted for the co-formulation of Darzalex and PH20. The priority date for this patent is 01Nov2016 which means its expiry date is 01Nov2036. A patent has also been filed for Phesgo, US 2021/0085597.
And here is what Helen said about this topic during the last CC
Q&A session:
“Charles Duncan
Yes. Hi. Thanks Helen and Elaine for taking the follow-up. A quick question regarding the continuation of royalty growth as a function of co-formulation patents. You mentioned that some had been filed. Do you anticipate being able to say that any of those are public or granted say that publicly over the course the next say two years?
Helen Torley
Yes. The timing says it is not in our control. Obviously, we're thrilled that the partners did file them. It'll be down to the patent office and in part due to the partner strategy. So we can't give you a time for it. But as we're thrilled to see this progress because of the benefit this has both in terms of the opportunities to extend the duration of time look at royalties, but also push the times of the step down. But I can't give you a time window. It'll be on a product by product basis.
Charles Duncan
I know you probably can't disclose identities, but can you say whether or not any of them are on Wave 2 products.
Helen Torley
Yes. I can't say that. We have a relatively small pool of opportunities in terms of that. But just to say, that we are excited that our partners are working very hard with us to find that moment of innovation and novelty that we all feel very strongly about has got a very good chance of getting these cool formulation patents. And we're not done yet. I think that's another core thing to hear. While these several partners have moved forward we continue to be very active with several others. And so you're going to see more and more of these co-formulation patterns being submitted over time based on the novelty that can be found when they're co-formulated with ENHANZE.”
Yes, I would like to see the insiders buying shares now on the open market.
Thanks for your post. Institutional hedges are usually PARTIAL and to reduce potential downside. Longterm, they are either net bullish or net bearish. It would make no sense to pay the fees if you want to be net neutral.
In this case they are clearly net bullish. This is a rinse and repeat of history. If you recall, years ago they bought low interest convertible bonds when Halo was trading in the teens and make handsome profits when they converted those bonds above the strike price and did quite well.
If they have any hedges left and if they are smart (I know they are), they would close out their hedges at these silly prices.
Correction: PEG of 0.67
I have been buying everyday this week. Present value is defined as the current value of a future sum of money or stream of cash flows. Right now Halozyme is trading at less than the sum of its earnings through just 2028!!! We are at a PE of 12.7 and a PEG of 1.0
Remember the convertible bonds? The institutions that sold it to Halozyme are only making a 1% interest rate return on it. This is well below the rate of inflation even before COVID. Why did they do it? Because they stand the chance to make more if they can convert the bonds to shares. At what price are they allowed to convert to shares? Not below $65. Institutions much smarter than you and I thought there is a good chance halo will exceed $65.
We know from the SA article that Faspro already has a coformulation patent and others are in the works. On every presentation, Helen has also reiterated a 40% CAGR in royalties for every year between now and 2027. This is all based on existing programs and not dependent on new partnerships.
However, if this not clear to you, then perhaps there are others who don’t understand it either and she should explain it more clearly. The Seeking Alpha article on this topic is helpful.
Halozyme is officially into Alzheimer’s indication. Rhuph20 (Enhanze) Clinical trials dot gov study updated yesterday:
Recruiting in phase 2
This is an open-label pilot study designed to explore whether daratumumab may have a clinically meaningful effect in patients with mild to moderate Alzheimer's disease. During the treatment phase, eligible subjects will receive daratumumab SC 1800 mg (daratumumab 1800 mg with rHuPH20 30,000 units) subcutaneous infusion over 3-5 minutes (15 mL) once weekly for 8 weeks followed by daratumumab SC 1800 mg every 2 weeks for 16 weeks.
Janssen Scientific Affairs, LLC
https://clinicaltrials.gov/ct2/show/NCT04070378?term=Rhuph20&draw=16&rank=76
My sense is that the Halozyme/Enhanze story is still largely unknown to the retail investors. There are many including Cramer who believe the retail investors are and have been far more influential and consequential than the traditional institutions for the past year. Collectively, there is so much money in the hands of the retail cohort (simply because there are so many of them) that they affect the direction of the market and individual stocks. Many of the institutions have given fighting this trend and actually joined them by chasing the momentum stocks. This in turn has amplified the effect.
Halozyme will have its day in the sun again when one or both of the following occur:
1) The momentum/meme stocks crash and retail participation starts to trend back to historical averages. This is when fundamentals will start to matter again. We have seen this movie before (late 90’a and early 2000’s).
2) Helen and team start sharing the halo/enhanze story with the retail cohort via social media, CNBC and Bloomberg. Helen might want to give interviews on YouTube with some of the young retail influencers or go back to MadMoney. Last time she went, the focus was on Pegph20. She now has a much more compelling story to share. Cramer will eat up the fantastic growth offered at PE of 13 and PEG of 0.7.
Smart/patient investors won’t mind if 1&2 don’t happen tomorrow. It just means they have more time to accumulate at these low prices.
Fidelity, google finance, yahoo finance, Etrade and finviz all show a PE ratio of 13 for Halozyme now. For PEG ratio of 0.73 (see finviz) and the rapid forcasted growth, Halozyme is a steal at these prices. Buying on all dips. ??????
From fiercepharma.com
With subcut Darzalex driving growth, Halozyme eyes role for drug delivery tech in cell therapies
Halozyme Therapeutics has outlined plans to expand use of its Enhanze drug delivery technology, branching out beyond antibodies to cover small molecules and cell therapies.
Enhanze is best known today as the technology behind subcutaneous formulations of antibody therapies such as Johnson & Johnson’s oncology blockbuster Darzalex. But Halozyme and potential partners are starting to look beyond monoclonal and bispecific antibodies, with small molecules and cell therapies on their hit lists. The cell therapy opportunity is in its early stages.
“It's fair to say it's a minority of the conversations we're having. But I do think as cellular therapies are advancing more and more in the clinic, we're going to have companies come and want to discuss with us what potential benefits could be with Enhanze,” Halozyme CEO Helen Torley told investors on a quarterly results conference call.
Torley said bispecifics and monoclonal antibodies make up the largest slice of the conversations that Halozyme is having with potential customers, followed by small molecules and cell therapies. While it is early days for the move into new modalities, Halozyme sees reasons to think it can make a mark outside of the biologics that are the focal point of its business today.
RELATED: GSK's ViiV eyes 'ultra-long-acting' HIV drugs with Halozyme deal
According to Torley, people are now “thinking about small molecules and in particular thinking about longer duration of therapy and how that could improve the patient experience, potentially even improve compliance,” opening up a broader set of opportunities for the company. Halozyme could open up further opportunities by adding to its toolkit of technologies.
“We continue to evaluate the potential for new technology platform expansion through acquisition with the goal of accelerating and extending long-term revenue growth. We're looking at platforms that are somewhat or largely derisked where we can take our skills and license it to other types of companies,” Torley said.
Don’t take my word for it, have a look at this beautiful discounted cash flow analysis from Simply Wall St:
Bottomline: current fair market value for Halozyme based on its discounted furure cash flow is $120.69.
Below are the data sources, inputs and calculation used to determine the intrinsic value for Halozyme Therapeutics.
Details:
NasdaqGS:HALO Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 12 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 6.2%
Perpetual Growth Rate 5-Year Average of US Long-Term Govt Bond Rate 2.0%
An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.
Calculation of Discount Rate/ Cost of Equity for NasdaqGS:HALO
Data Point Calculation/ Source Result
Risk-Free Rate 5-Year Average of US Long-Term Govt Bond Rate 2.0%
Equity Risk Premium S&P Global 4.4%
Biotechs Unlevered Beta Simply Wall St/ S&P Global 0.86
Re-levered Beta = 0.33 + [(0.66 * Unlevered beta) * (1 + (1 - tax rate) (Debt/Market Equity))]
= 0.33 + [(0.66 * 0.857) * (1 + (1 - 21.0%) (15.35%))] 0.974
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm) 0.974
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 1.96% + (0.974 * 4.38%) 6.23%
Discounted Cash Flow Calculation for NasdaqGS:HALO using 2 Stage Free Cash Flow to Equity
The calculations below outline how an intrinsic value for Halozyme Therapeutics is arrived at by discounting future cash flows to their present value using the 2 stage method. We use analyst's estimates of cash flows going forward 10 years for the 1st stage, the 2nd stage assumes the company grows at a stable rate into perpetuity.
NasdaqGS:HALO DCF 1st Stage: Next 10 years cash flow forecast
Levered FCF (USD, Millions) Source Present Value
Discounted (@ 6.23%)
2022 349.75 Analyst x4 329.25
2023 458 Analyst x4 405.88
2024 548.67 Analyst x3 457.73
2025 643.67 Analyst x3 505.51
2026 713.55 Est @ 10.86% 527.54
2027 771.97 Est @ 8.19% 537.28
2028 820.75 Est @ 6.32% 537.75
2029 861.88 Est @ 5.01% 531.6
2030 897.18 Est @ 4.1% 520.94
2031 928.18 Est @ 3.46% 507.35
Present value of next 10 years cash flows $4,860
NasdaqGS:HALO DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value FCF2031 × (1 + g) ÷ (Discount Rate – g)
= $928.182 x (1 + 1.96%) ÷ (6.23% - 1.96% ) $22,181.65
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
$22,182 ÷ (1 + 6.23%)10 $12,124.56
NasdaqGS:HALO Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= $4,860 + $12,125 $16,984.56
Equity Value per Share
(USD) = Total value / Shares Outstanding
= $16,985 / 141 $120.69
NasdaqGS:HALO Discount to Share Price
Calculation Result
Value per share (USD) From above. $120.69
Current discount Discount to share price of $40.71
= ($120.69 - $40.71) / $120.69 66.3%
Learn more about our DCF calculations in Simply Wall St’s analysis model.
Close
Mr. market is giving us a huge bargain. Halo is trading at a 2022 PE ratio of 13 (see below). We will at least double from here.
High margin platform with forecasted/de-risked growth for at least a decade.
“analysts at Cantor Fitzgerald boosted their FY2022 EPS estimates for shares of Halozyme Therapeutics in a research report issued on Wednesday, November 3rd. Cantor Fitzgerald analyst C. Duncan now expects that the biopharmaceutical company will post earnings of $2.89 per share for the year, up from their previous estimate of $2.86.”
Have a look at Halozyme’s chart between November 2020 and Feb 2021. Rinse and repeat for the next 3-4 months
No, quite the opposite. They need to do more buybacks.
Halozyme’s return on equity is 209.20% (https://finviz.com/quote.ashx?t=HALO).
Show me another biotech or pharma with such handsome derisked ROE and cheap enough that halo can buy them and I will say yes go for it. Otherwise they should buy back more.
Cash sitting in the bank is losing value due to inflation.
Buybacks are one of the best things they have done for the shareholders. The average buyback price so far has been in the 20’s (read the CC script). That was super smart.
Should see $50’s before year end
JMP Securities raised price target from $34 to $55 this am.
New price target:
https://www.investing.com/news/jmp-securities-stick-to-their-buy-rating-for-halozyme-therapeutics-2665374
Previous price target:
https://www.benzinga.com/analyst-ratings
Great quarter. In addition to fantastic financial results which far exceeded analyst consensus, what we heard on the CC which were material news/catalysts:
- Janssen signed and paid $30 mil for new product (HIV reverse transcriptase) in the 3rd quarter
- Halo is in talks re “neurology and psychiatric” therapies. “Psychiatric” indication was definitely the first time Helen mentioned this category.
-Halo is in talk regarding “cell therapies.” This was also a first mention by Helen.
-It sounded like starting 2022 they plan on authorizing a brand new share buy back program.
Don’t be surprised to see new analyst coverages/upgrades and raised price targets based on these results and news. Also expect to see an increase rate of new partnerships.
From a new Seeking Alpha article posted today:
“SA: What’s one of your highest conviction ideas right now?
Small Pharma Analyst: Halozyme (NASDAQ:HALO). Their ENHANZE drug delivery system allows drugs to be dosed subcutaneously instead of IV. They have established long-term contracts with companies with the highest-selling IV drugs, converting them to subcutaneous delivery. Royalties are expected to grow to $1 billion by 2027. Wall Street thinks there will be a large drop off after that due to patent expirations but co-formulation patents should protect revenue well into the 2030s. This is one of the safest investments I have in biotech. I expect earnings and the share price to appreciate 20% per year for the next decade.”
SA Interview: Investing In The Pharmaceutical Industry With Small Pharma Analyst https://seekingalpha.com/article/4459368-sa-interview-investing-in-the-pharmaceutical-industry-with-small-pharma-analyst?source=copyToPasteboard
1- Yesterday, insider exercised options but did not sell the resulting shares. Added to his holdings.
2- from Nasdaq dot kom:
Price/Earnings Ratio
2021 Estimates 20.09
2022 Estimates 13.2
2023 Estimates. 10.92
Forecast P/E Growth Rates:
Growth 2021 99.63
Growth 2022 52.26
PEG Ratio:
Forecast 12 Month Forward PEG Ratio 0
Based on what I see on clinicaltrials.gov, it does not appear so
Conservative Halozyme valuation using Benjamin Graham’s stock value formula:
Benjamin Graham formula, estimates the intrinsic value of a stock by multiplying the current annul earnings per share of a company with the factor (8.5 + 2g), where g is the growth rate over the next several years.
Halo’s 2021 EPS is 2.27 (from seeking alpha) and a very conservative earnings growth rate is 20% annually. (Halo has guided a sustained multiyear 40% CAGR in royalties but I’ll use seeking alpha’s 20% conservatively forecasted rate for earning growth for the next 10 years). So g = 20.
If you plug these numbers into Graham’s formula:
2.27 x (8.5 + 40) = 92.72
$92.72 per share. Let this sink in a bit and remember the famous quote; “in the short run, the market is a voting machine, but in the long run, it is a weighing machine.” Don’t be surprised if share prices double up from here over the next few months.
This intrinsic value is not lost upon institutions and this is why Halozyme is 92% institution owned. It won’t be lost on big pharma either. They might convince halo’s board to sell the company with an offer significantly over $100 per share.
… and a quote from Helen:
“there's also the potential to obtain additional co-formulation patents on certain novel partner products, potentially extending the mid single digit royalty term up to 20 years post patent filing date. While each agreement is negotiated separately, and terms and conditions vary across agreements, in general, the co-formulation patents have the favorable effect on the duration of the royalty term and potentially delay the timing of the royalty step down.”
20 years of $$$ from Faspro and Phesgo:
“U.S. Patent 10,385,135 has been granted for the co-formulation of Darzalex and PH20. The priority date for this patent is 01Nov2016 which means its expiry date is 01Nov2036. A patent has also been filed for Phesgo, US 2021/0085597. If granted this patent will extend the patent life of Phesgo until 2037. We expect similar patents to be filed and granted for all products in development using ENHANZE.”
$$$
Correction:
“Anyone who thinks pharma would give up additional years of exclusivity for a 2% cost difference knows little about this industry.”
Again, she never said ALL products will have a step down. As I said, it is clear that Janssen and Roche, the two biggest royalty generators for Halozyme applied for and RECEIVED co-formulation patents for their products in the US and will likely do so elsewhere. Others will do the same as indicated by the seeking alpha biotech analyst. The nay-sayers’ argument was that it is not in the interest of the pharma to get co-formulation because they would have to continue to pay royalties to Halo at full price. However, this hypothesis has been nullified for good. It’s just common sense that the benefits of a coformulation significantly outweighs the difference between a 4% and 2% in royalties to halo. Anyone who thinks pharma would not give up additional years of exclusivity for a 2% cost difference knows little about this industry.
Also, don’t think that pharma would switch to a generic ph20 after 2024 or 2027. They would gladly accept the 2% difference to avoid running trials all over again with the generic ph20.
Your inference regarding what Helen or CFO said recently is incorrect. Helen or the CFO never said that all royalties are subject to a 50% step down.
They have repeated over and over again that if there is coformulation patent, there would not be a 50% step down. Clearly in case of the 2 largest royalty generators, Phesgo and Faspro there will no step down in 2024 or 2027 due to the coformulation patents references in the seeking alpha article.
Remember that CEO’s and CFO’s have SEC mandates to be transparent. Even if one or two of their partnered products don’t have co-formulation patent they have to make sure the investors are aware of the potential step-down. Since their big pharma contracts forbids them to provide agreement details, we need the good research work of the likes of seeking alpha analyst to find out which partnered product has a co-formulation patent and not subject to step-down.
It sounds like majority of the products do have the patent or will.
This issue has now been settled for good. Nay sayers will continue to spread doubt. Longs will continue to invest and enjoy steady a conservative 20% compound gains in halo’s stock.
This is huge (from seeking alpha):
“U.S. Patent 10,385,135 has been granted for the co-formulation of Darzalex and PH20. The priority date for this patent is 01Nov2016 which means its expiry date is 01Nov2036. A patent has also been filed for Phesgo, US 2021/0085597. If granted this patent will extend the patent life of Phesgo until 2037. We expect similar patents to be filed”
“Every drug that uses PH20 is going to have a formulation patent since the primary purpose of the subcutaneous formulation is to extend the drug's patent life beyond the composition of matter expiration.”
New trial posted: TAK-881 and Enhanze
https://clinicaltrials.gov/ct2/show/NCT05059977?cond=Rhuph20&draw=4&rank=46
ClinicalTrials.gov Identifier: NCT05059977
Recruitment Status : Not yet recruiting
First Posted : September 28, 2021
Last Update Posted : September 28, 2021
ASAP BioPharma Conference Keynote Preview: A Powerful Combination Brings Many Benefits
September 23, 2021
Posted By: Michael Burke
How do you create a great collaboration?
Old alliance hands will tell you: it has to be built on trust, transparency, clear communication, and a compelling value proposition for both parties. And in biopharma, the results should benefit the patient as well.
It’s sage alliance wisdom—and represents just a fraction of the insights to be gleaned beginning Monday, September 27, in the keynote address opening the 2021ASAP BioPharma Conference. And it’s a two-for-one: Helen Torley, CEO and board member of Halozyme Therapeutics, and Tim Van Hauwermeiren, cofounder and CEO of argenx, will speak on “The Power of Collaboration in Bringing Greater Value to Patients.”
In a great collaboration, each side brings something to the table. In the case of Halozyme, it’s the company’s Enhanze® drug delivery technology, which facilitates subcutaneous injection of certain drugs, thus saving time and in some cases avoiding lengthy hospital or clinic visits. Halozyme has entered into 11 collaborations so far to marry its technology with its partners’ drug candidates—a powerful combination for pharma companies looking for alternative means of drug delivery.
A World of Difference
One such company is argenx, which brings a very promising asset in the form of efgartigimod (ARGX-113), currently being investigated for potential treatment of six autoimmune diseases including myasthenia gravis. CEO Tim Van Hauwermeiren said the combination of argenx’s asset with Halozyme’s technology is definitely a win-win.
“The beauty of Halozyme’s technology [is] you can [take] a one-hour infusion, for which you need to drive a few hours in many cases, you need to register, you need to sometimes be premedicated, then you sit in the chair for an hour, then they need to monitor you for another 30 minutes, then you drive back home again—if you can replace that with a 30-second self-administered shot under the skin, that is a world of difference,” he said.
That’s especially true in a pandemic, where the potential quickness and efficiency of subcutaneous injection may help address such issues as “capacity constraints” in hospitals and clinics and also an ongoing nursing shortage, according to Halozyme CEO Helen Torley.
But aside from the novel technology, what makes the collaboration work? Torley said it comes down to just a few fundamentals.
“One of the things Tim and I will talk about is how to start an effective collaboration,” she said. “I think argenx clearly started well: they showed a level of trust that allowed them to be very transparent about what they were trying to achieve. Trust is number one. The second one really is listening. Each company has different stakeholders who may be trying to achieve different things, so you’ve got to be able to listen and hear what matters. And then you’ve got to be able to come up with a win-win path forward, and have that openness to recognize that in a collaboration everything will be stronger if you find a path that everybody feels comfortable with. That’s how we work, that’s how we’ve trained our alliance teams and our internal teams.”
Meet the New Boss: The Patient
The patient-centric element is another key ingredient in the Halozyme-argenx formula, according to both CEOs. Van Hauwermeiren acknowledged that it’s part of a growing trend in the biopharma industry.
“I started my career at Procter & Gamble,” he said. “That’s a fast-moving consumer goods company, and there the dominating mantra was ‘The consumer is the boss.’ When I joined [the biopharma] industry in 2003 I was a little bit shocked because the patient was not really the boss. This industry is shifting as a whole, becoming more and more patient-centric. The industry is reaching out to patients; patients are also reaching out to industry—they want to get involved, they want to be heard, they want to have a voice in how we do endpoints, trial designs, etc. That is a very interesting trend.”
It’s a trend that’s been accelerated by COVID-19.
“Things which this industry should have done already years ago indeed were catalyzed by COVID—because we had to,” said Van Hauwermeiren. “For example, in our clinical trials it became easier to dose patients at home: why do we need to go to a hospital each week? Collecting data started being done remotely: why do you need to go to a physician’s office each time to sample or collect data? The situation forced [the industry] to do what we [should have] done a long time ago. And it does speed up [trends like subcutaneous injection].”
Among the keys to this collaboration, according to Van Hauwermeiren, are that argenx treats Halozyme as an “equal partner,” that the two companies’ teams are fully integrated and aligned on a shared patient focus, and that they have expanded the partnership twice already. “That is the hard, bottom-line metric you use to judge the success of a collaboration,” he said.
For her part, Torley stressed clear communication and ease of decision making as essential factors in the alliance’s success.
“Listening is so important, because each company has got a slightly different strategy, a different decision-making process,” she said. “But you’ve then got to adapt what you’re doing to that particular company, and that’s where the art of being a very strong alliance lead comes in. You need to know who to talk to, how to talk to them, what information is going to be important. You’ve got to listen and you’ve got to learn and you’ve got to adapt to meet each customer’s needs because they’re all at different phases and just have different priorities and decision making. There’s no one-size-fits-all for partnership.”
For these and many more insights on the art and science of great biopharma collaborations, be sure to register now for the ASAP BioPharma Conference taking place virtually Sept. 27–28, 2021. Go to asapbiopharma.org for more information.