Replies to post #122351 on Biotech Values

[mcbio]

Diabetics contribute disproportionally to the prevalence of cardiovascular, renal, and ophthalmic disease, so one does not have to invest in companies that sell diabetes drugs per se in order to participate in The Global Diabetic Tailwind. Among the companies on my LTBH list, NVS (Lucentis), ABT (Bardoxolone, glucose monitors), PFE (Eliquis), and AGN (LapBand) are indirect beneficiaries of this trend.

I would like to own NVO at some point, but I’m looking for a better entry.

Dew, any thoughts on the much smaller and much more speculative diabetes plays among the small-caps, particularly in the ultra-fast acting insulin space? I am now long BIOD and don't recall if you've commented on them before. I know you are skeptical of MNKD and Afrezza (I don't disagree with you there). HALO is in this space as well and recently had some positive news in their program (#msg-64606879). I like BIOD just because it's such a tiny market cap (~$50M) and it's a turnaround play given their prior issues in Phase 3 (I prefer the beaten down turnaround plays over the highfliers). Clearly, if both of their two new ultra-fast acting insulins manage to fail in the Phase 1 trials set to report 3Q this year, they will be in some trouble and the stock will fall much further, but I am hopeful that this is a relatively low hurdle that they can meet with one or both. The key is likely going to be the Phase 2 results, which they are guiding for reporting 2H2012 (assuming all goes well in Phase 1), at which time they hope to partner if results are good.