Biotech Values

[DewDiligence]

Re: Fallout from NVO's CKD data

If I'm interpreting it correctly, the "clown show" does not pertain to NVO's clinical data (which are clearly superb in order for this kind of trial to be stopped early), but rather to today's steep selloff in many medical-device and food companies. It's unlikely, IMO, that the net effect of GLP-1 drugs on these various businesses will be anywhere near as substantial as the market-value losses to these companies' stocks in the recent selloff.

For instance, the demand for ZBH’s orthopedic implants may increase rather than decrease as a consequence of weight loss insofar as many physicians will not perform hip- and knee-replacement surgery on obese patients.

Similarly, it’s unclear whether weight loss will lead to less consumption of snack foods sold by such companies as PEP; it could conceivably lead to more consumption of such products due to the perceived “safety valve” afforded by GLP-1 drugs.

Further, DXCM (one of stocks being hammered today) claims to have data that patients taking GLP-1 drugs make more use of continuous glucose monitors than patients who are not on GLP-1 drugs. If true, this is bullish (not bearish) for ABT, whose FreeStyle Libre is the biggest-selling medical device, ever (#msg-172393915).

I could go on, but I think that’s enough examples to make the point.

p.s. I posted the primary endpoint of NOVO's 'FLOW' trial in #msg-172996917.