Endonovo Therapeutics (OTCQB: ENDV) is an innovative biotechnology company developing bioelectronics-based products and therapies for regenerative medicine. The company is in the process of obtaining an orphan drug designation for its off-the-shelf, allogeneic treatment for Graft-Versus-Host Disease (GvHD), which if successful could see the company's $40 million valuation rise significantly.
Graft-Versus-Host Disease is a rare condition that occurs when donor bone marrow or stem cells attack the recipient and can cause a failure of the graft and is a significant cause of morbidity and mortality in transplants.
Endonovo's treatment for GvHD uses bioelectronics-enhanced mesenchymal stem cells from the human umbilical cord. These stem cells are expanded and enhanced using their proprietary bioelectronics platform called Cytotronics to create next-generation, more biologically potent cell therapies.
The company's approach to creating next-generation cell therapies differs from approaches currently being pursued by others, which include genetic modification and the use of small molecule drugs to enhance the therapeutic properties of stem cells. This means that ENDV's approach may be translated to other types of stem cells, easier to scale up and ultimately manufacture.
At the current share price, we believe that Endonovo presents a potential opportunity for growth investors and any chance of buying before potential FDA approval could bode well for traders.
As it turns out, rare diseases are not so rare after all. An estimated 25 million people in the US alone collectively live with some sort of orphan disease. Therefore, these rare diseases present biotechs and investors alike "rare" opportunities to reap huge profits.
Some of the most notable deals involving orphan drugs include Horizon Pharmaceutical's acquisition of Hyperion Therapeutics for $1.1 billion to gain a product to treat a rare inheritable urea disorder that can cause a build-up of ammonia in the body, and Alexion Pharmaceutical's $8.4 billion acquisition of Synageva Biopharma which was developing a drug to treat a rare metabolic disorder.
While the examples above may seem to represent the higher end of the market potential, we believe that there are still a number of firms that have the capability to match or even surpass these results as highlighted below.
Multiplied Economics
For those up to the task of fulfilling the need for orphan drugs, the probability of massive gains is nearly certain. According to a recent research report by EvaluatePharma, global sales for orphan drugs are expected to grow 10.5 percent annually to around $176 billion in 2020. Apart from this impressive growth, the other aspect that makes orphan drug makers so appealing is the fact that the price range of these drugs ranges from $200,000 - $300,000 per year for a single patient with treatments usually lasting a lifetime. On top of the rich economics, once an orphan indication is approved the sponsor receives seven years of patent exclusivity under the Orphan Drug Act and the FDA cannot approve another drug in that designated orphan indication for the period.
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