After a long stagnation, is CNS starting to crack?

After being the industry’s graveyard for over 20 years, there is finally room for optimism in CNS (central nervous system) disorders. The void created in the field is now being filled by small companies which are using novel therapeutic (gene therapy, antisense, antibodies) and development (genetic validation in humans, biomarkers for patient selection) approaches. While clinical results are early and sparse they may represent the beginning of a new innovation cycle in CNS.

Tackling old problems with new tools

A lot of the progress stems from using new treatment modalities in order to modulate targets previously regarded as underuggable.

Gene therapy is making headways in rare genetic diseases led by Avexis’ (AVXS) SMA program and Abeona’s (ABEO) Sanfilippo programs. For these programs, as biology is already sorted out (driver of the disease is known) the challenge lies in delivery to the brain and duration. So far results with AAV9-based programs look promising but sample sizes are small and follow up is limited. If the data hold up, and AAV9 vectors can lead to meaningful protein production in the brain/CNS, the implications cannot be overstated. CNS is a particularly attractive domain for AAV-based gene therapy because neurons don’t replicate so the transduced cells should not be diluted with time.

Antisense drugs are proving to be a useful tool to modulate targets in the CNS (via repeated intrathecal administration). Biogen/Ionis’s (IONS) Spinraza, the first FDA approved treatment for SMA1, works by enhancing production of an alternative protein to SMN1 which is mutated in the disease. Last month, Ionis and its partner Roche reported that another antisense drug (IONIS-HTTRx) demonstrated target engagement, this time in Huntington disease. Although it is too early to conclude anything about efficacy, the dose-dependent reductions of mutant Huntingtin in the CNS are a remarkable achievement.

Antibodies are a successful class of drugs but their use has been predominantly limited to oncology and inflammation. After years of setbacks that included the never-ending beta amyloid farce and safety concerns with anti-NGF antibodies for pain, looks like anti-CGRP antibodies will become the first approved class of antibodies for a CNS indication (migraine). Multiple data readouts from Alder (ALDR) Amgen (AMGN), Lilly (LLY) and Teva (TEVA) validate this class and are likely to result in FDA approvals in 2018.

Promising small molecule CNS programs

The lion share of CNS drug development is still based on small molecule drugs. This segment has benefited from genetic research in humans that can validate targets more reliably (preclinical CNS models are notoriously hard to translate to humans) and more efficient drug discovery tools. Nav1.7 is the poster child for CNS target validation based on humans genetics (lack of pain sensation in people with Nav1.7 mutations) although the target has proven challenging to date.

My top three CNS picks in this group are:  Sage (SAGE) in depression, Xenon (XENE) in epilepsy and Minerva (NERV) in Schizophrenia and insomnia.

Sage – Potential breakthrough in depression

Despite a complete failure in preventing epileptic seizures, Sage’s GABA agonists are emerging as a novel class of antidepressants, potentially the biggest advancement in depression in decades.

In October, the company announced positive P3 data for SAGE-547 in PPD (post-partum depression), which will probably lead to the first FDA approval in this indication (especially in severe PPD where the effect was more pronounced). It is hard to estimate the commercial opportunity in severe PPD as there is no benchmark to rely on, but epidemiological studies and literature suggest an annual incidence of 40k in the US (1% of ~4M births) which translates to a global market opportunity of ~$500M.

In November the company announced positive P2 results for its proprietary next-gen oral drug (SAGE-217) in MDD (Major Depressive Disorder), a huge indication that has been in stagnation since the 1990’s. Results were highly positive with a 6.9-point placebo-adjusted decrease in HAM-D (a commonly used depression scale), the primary endpoint, with only two weeks of treatment. At day 15, the drug led to a remission (no signs of depression) rate of 64% vs. 23% in the placebo arm. The most striking pieces of information were the very fast onset (statistically significant benefit already after 1 day) and the long lasting effect (separation from placebo at 4 weeks, two weeks after the last dose).

These data are from a relatively small study (89 patients) and need to be corroborated by larger trials, but the emerging profile of SAGE-217 is very compelling. Efficacy is at the (very) high end of the spectrum of what is commonly seen in MDD and most depression drugs take several weeks to reach this effect. Safety profile continues to look benign and highly differentiated from approved antidepressants. Such a profile will likely make SAGE-217 an overnight blockbuster, if approved.

The primary risk for SAGE-217 is its long term safety profile, which is still an open question given the limited treatment period in the P2. The company claims it already has animal tox data covering chronic use but in CNS indications, even a low rate of severe adverse events can lead to termination.

SAGE-217 may compete with J&J’s esketamine (P2 data recently published) and Allergan’s (AGN) rapastinel. It is hard to compare across small studies that used different endpoints and design, but sage’s molecules appear to have a clear advantage on safety and route of administration ( Esketamine is given intranasally whereas  rapastinel is given IV).

Xenon – Genetically validated targets for epilepsy

Sentiment around Xenon is understandably poor following the setbacks in its pain programs with Genentech (on hold following preclinical tox findings) and Teva (failed multiple P2s). In 2018, investor focus will shift to the company’s epilepsy programs (XEN1101 and XEN901), which I view as attractive and de-risked based on genetic validation in humans. Xenon intends to pursue XEN1101 and XEN901 in rare genetic pediatric epilepsies in parallel to the general adult population, a strategy that has never been tried and will require the FDA’s blessing early on.  Long-term safety is another major overhang, as is the case with most CNS programs.


XEN1101 was in-licensed from 1st order Pharmaceuticals in 2017. The drug works by opening Kv7 ion channels, an approach validated by human genetics (inactivating mutations in Kv7 are seen in a severe form of childhood epilepsy) and clinical data (ezogabine, a predecessor of XEN1101 had been approved for epilepsy in 2011 but was later withdrawn due to safety issues). Ezogabine was a highly efficacious antiepileptic but prolonged use led to pigmentation in the eye and skin that at the time raised concerns about vision loss and skin toxicity, which in turn triggered a black box warning. Although later the FDA softened its language and stated that pigmentation had no adverse effect on vision or other tissues, sales of the drug plummeted until it was withdrawn from the market in 2017.

XEN1101 was developed by Valeant (who co-developed ezogabine with GSK) and was designed to avoid pigmentation, which is believed to stem from dimerization of the drug and binding to melanin. In contrast to ezogabine, XEN1101 does not dimerize or bind melanin so it should not lead to pigmentation (needs to be validated in the clinic). XEN1101 is also more potent and selective and appears to be superior to ezogabine in animal models.

Xenon recently initiated P1 in healthy volunteers with XEN1101 and incorporated an imaging endpoint that could demonstrate biological activity already in P1. A P2 in adult patients is slated to begin in H2/2018 with the potential to reach clinical proof of concept in 2019. The company plans to pursue a subset of pediatric patients with Kv7.2 mutations in parallel to the adult development program. This is a novel approach that has never been tested (typically, drugs are first approved in adults before moving to pediatric indications) so it remains to be seen if and how the FDA will address this. From a clinical perspective, treating these patients early could be critical for preventing long term cognitive damage. The company estimates there are ~1500 patients with Kv7.2 mutations in the US.


XEN901 is Xenon’s internally developed Nav1.6 inhibitor. Similarly to the case with XEN1101, the target is validated by activating mutations in Nav1.6 observed in a rare form of childhood epilepsy, making it a “driver” mutation. The drug is expected to enter P1 in Q1/2018 and its development plan is similar to that of XEN1101 (start with P2 in adults and in parallel pursue the rare pediatric indication).

Minerva – Traditional CNS pipeline with convincing P2 data

Although Minerva’s lead programs look “old-fashioned”, reminiscent of the traditional Pharma CNS pipeline, its lead programs, MIN-101 for schizophrenia and MIN-202 for insomnia and depression, have encouraging data sets that point to clinical differentiation.

In its P2, MIN-101 demonstrated a significant effect on negative symptoms (apathy, poor social functioning) as well as cognitive symptoms with a mild safety profile. While the effect was not dramatic, it appears clinically meaningful (no other drugs have a proven effect on negative symptoms, some drugs are used off label) and dose dependent. A P3 for MIN-101 started last month with data expected in 2019.


MIN-202 is Minerva’s orexin-2 inhibitor, originally in-licensed from Janssen in 2014. The drug recently started two P2 studies in MDD and insomnia patients based on preliminary positive efficacy in a small P1b study in MDD patients who also suffer from insomnia. Orexin 2 antagonist could be a safer alternative to traditional sleep medicines as well as Merck’s recently approved dual orexin 1/2 inhibitor, Belsomra.

Limited composition of matter patent protection is a significant issue since Minerva is not going after orphan diseases. The company hopes its formulation patents to prevent (or at least delay) generic competition. The primary issue with owning the stock in 2018 is the lack of catalysts but valuation is attractive ($242M with $130M in cash expected at year end).

Two additional CNS stocks to watch: Denali and Ovid

Two other CNS stocks on my watchlist are Denali Therapeutics (DNLI) and Ovid Therapeutics (OVID). Both employ a more “precision medicine” like approach by pursuing genetically validated targets and or biomarker-defined patient populations.

Denali’s lead program is DNL201, a LRRK2 inhibitor for Parkinson’s disease that just completed P1. While there is a strong rationale for targeting LRRK2 in Parkinson (activating mutations are linked to Parkinson), DNL201 (while at Genentech) generated a safety signal in monkeys that prompted the FDA to issue a partial clinical hold. Last month, the FDA lifted the hold, which will allow Denali to test the therapeutically optimal doses of the drug in patients. P1 data demonstrate very good target engagement, which further de-risk the program. The company is expected to start P2 with DNL201 or a backup compound later in 2018 so efficacy data is still 18-24 months away. The company has a broad preclinical pipeline for other diseases including Alzheimer’s and ALS, all programs will utilize a biomarker for patient selection.

Ovid’s lead program is OV101, an isoform-selective GABA agonist that was originally developed by Merck and Lundbeck for insomnia (generated P3 data). Similarly to Sage’s molecules, OV101 can activate a discrete subset of GABA receptors (extrasynaptic, delta subtype) but according to Ovid, OV101’s unique feature is its ability to activate the receptor even in the absence of the natural ligand, GABA. The company is pursuing 2 genetic disorders (Angelman and Fragile-X syndrome) where GABA levels are decreases, but the drug does not directly target the underlying genetic defect in these syndromes. Another factor to bear in mind is the short patent protection which means the company will have to rely on market exclusivity for orphan diseases. Ovid’s second drug is a CH24H inhibitor for rare genetic types of epilepsy, currently in a small P2.

In both cases, I amwaiting for a cheaper entry point given valuations. ($1.54B for Denali, $234M for Ovid).

Portfolio updates

I am buying more Xenon and initiating a new position in Minerva. While neither company is expected to generate clinical proof of concept data in 2018, I still think valuations are compelling. I am also initiating new positions in Zymeworks (ZYME), Madrigal (MDGL) and Viking (VKTX).


Portfolio holdings – January 14, 2018

portfolio - 14-1-2018 - after changes

biotech etfs - 14-1-2018

151 thoughts on “After a long stagnation, is CNS starting to crack?

  1. Thanks Andre as well. It is looking very iffy and I lightened my holdings just in case. Will be great to hear Ohad’s opinion on these developments.


  2. Andre (XENE) – Looks like they simply use the compound which has no patent protection (developed in the 70’s). Don’t thin they need to get a license from anybody for that.

    Alex (FMI) – Not sure…

    Bouschka (VBLT) – Having been following them, drug obviously doesn’t work.

    Andre (ESPR) – The company posted slides on their website.

    Chris (ESPR) – Wouldn’t say cheap but I plan on holding, I think it’s a drug.

    DAn (SNSS) – Hard to understand what they actually saw… there was a patient at the 50 mg cohort that discontinued treatment and now they need to expand the cohort to 6 patients. Don’t know if they think the AE is drug related but the tone on the CC was gloomy…



  3. Ohad
    ESPR – Thanks for pointing out to their slides.
    The results are confusing. The placebo arm when up by 5%?!? This really does not make sense, since if it was going up and up all the time, then why LDL-C is only 123 at baseline, not 150 or 200. Also the Bempedoic Acid baseline was 130+/- 23% and they got just 23% mean reduction from baseline, so it is the error bar of the base line. Not very convincing.

    REGN/SNY just lower the price of their PCSK9 to the same price level as the Bempedoic Acid (about $10-15 per day) but with two times higher efficiency. AMGN will also follow with price cut. MDCO/ALNY are coming soon with even more potent RNAi base LDL-C drug.
    Do you think ESPR can survive a price war with its late coming, inferior, yesterday technology?

    John Maraganore (ALNY CEO) twitted today
    “WOW! A 24% risk reduction + mortality benefit + discounted price! I think anti-PCSK9s are about to FLY! Love the #biopharma #innovation!”


  4. Andre where did you see that pricing would be 10-15 dollars per day for Praluent? I can only find that they are willing to adjust pricing for increased access for high risk patients and that ICER recommends $4500-8000 (11-20). I don’t interpret it as an across the board price drop and still see potential for ESPR to target patients that can’t use statins and don’t need large drops in LDL. Maybe I am missing something?

    As for ESPR 048 trial results. Baseline is what they were at before the trial started so they saw a decrease on average of 23% in LDL when adding bempedoic acid daily for patients who were already on optimized therapy. The placebo also would have continued the optimized therapy for patients without addition of Bempedoic acid so that is why their LDL did not continue to go up during the trial.

    REGN trial results are good for ESPR in a sense that they continue to show further decreasing LDL improves outcomes.


  5. Hello Ohad,

    Hope you are well. I wonder if you have any updates or new opinions to share on SNSS?
    Also, Have you had a chance to to reconsider or do some DD on APTO? seems that they will re-initiate the suspended ph 1 trial as well as hopefully encore for their fpan-BTK / pan-FLT3 inhibitor–some presentations at ACCR.

    Are you familiar with DMCAF? They are in ph2 with a Human Recombinant Tissue Kallikrien– supposedly the drug is already used and approved for inshemic stroke in china. They have attracted people with string resumes and top notch PI to lead the phase 2 and scientific advisory boards. Market cap is $40M. Seems that they are going after a big market and the fact that a drug using similar MOA is commercial in China bodes well.

    It seems to me that the valuation of ZYME, considering the big pharma partnerships and the breath of their technology, is still reasonable. What do you think?

    I have started a very small position in SELB a few weeks ago and I am thinking of adding more (recent drop). So I wonder if you have listened to the last CC.

    Thanks s always for your insight!


  6. Dan

    re ZYME, the old deals weren’t that great from a financial standpoint, but at least the last deal was very good and showed where deal terms are heading now after clinical PoC for their lead technology with ZW25. I would expect further deals from here at very good conditions, but of course it will take time with milestones etc… in the shorter term, quite a lot will depend on ZW25 further results. for people with some years horizon it is a very good investment imo.


  7. PS: even though the economics are not that great in older deals, the partnered programs entering the clinic will be a positive of course…


  8. Ohad
    ZYME replaced ZW33 with ZW49.
    In the Dec 2017 presentation they claimed:
    “ZW33 demonstrates superior tumor growth inhibition as compared to other HER2-targeted therapies ”
    -> Initiate Phase 1 clinical trial (H2 2017)
    March 14 Press release:
    “ZW49 exhibited superior activity when assessed against other approved HER2-targeted therapies ”
    -> file an IND application this year (2018) and begin clinical trails (it looks 2019)

    What is you take on the change and on the delay of their second drug by at least a year.


  9. Hammer

    Have u checked out this preclinical bio ticker $ALPN?

    Also what are the I/O targets that most interested u? Like; LAG3, OX40, GITR etc…..


  10. Ohad, I would appreciate your comments on both Arcus Biosciences [ rcus] and soon to be public Homology Medicines [ proposed symbol FIXX ]


  11. Alex (ESPR) – I don’t think it changes a lot as ESPR’s primary selling point is having an oral agent. For most patients that’s preferable over injectables.

    andre (ESPR) – I think the data are solid and the effect is real. It is not uncommon to see LDL increases in control arms and the effect is stat sig.
    Regarding competition with PCSK9, I think ESPR can easily compete with them in cases where patients need a more modest LDL lowering on top of statins/Zetia. It is an oral drug so should be the first choice regardless of pricing.

    Lorenzo (ARRY) – BRAF Melanoma data is truly impressive, survival benefit is huge. Totally missed out on them by selling last year just before the run…. Not sure they have a lot of room to go given the size of the opportunity. The CRC P3 trial is also very interesting but will take time.

    DAn –
    SNSS – Still unclear to me what was the SAE they observed and whether it was drug related. They definitely didn’t communicate that well…
    APTO – Not excited about the drugs, both may have safety issues.

    DMCAF – Sorry don’t know them.

    ZYME – Agree valuation is cheap relatively given their pipeline and licensing deals. The Daiichi HER2 ADC makes me a little bit more cautious, waiting to see data from ZYME’s bispecific HER2 ADC.

    SELB – Didn’t have a chance to listen but still quite interested in their program and applications for GTx and immunotoxins.

    andre (ZYME) – These things happen but don’t think it matters now, we need to see the data with ZW49.

    Robert Goulet (ALPN) – Have been following them as part of the IO field. Still qite early, tey seem to be big belieeers on multi specific agents, the CD28 agonist program is kinda scary although I am sure they figured out way to mitigate risk.

    So far all new IO targets are disappointing, I really hope INCY’s IDO study will have a positive readout but rumors and sentiment are quite negative. There are early new IO targets I find interesting but unfortunately I cannot discuss them.

    Ohadfan – Things have so busy here with the new fund, will try to post something soon…

    Bouschka (RCUS/FIXX) – Still need to familiarize myself with both.

    Richard Baker (GLYC) – Don’t think their data is compelling, hard to interpret single arm combo studies…



  12. Thank you for your work on this blog. What are your thoughts on ADXS. They have submitted for European approval for 2nd line cervical cancer, have a combo trial underway in cervical cancer with BMS’ Opdivo, a partnership with AMGEN starting trials in 2018 using patient specific antigens, and another antigen program entering the clinic in 2018. The market cap has slipped under $100M. Compelling value?


  13. Hey Ohad
    I was just listening to APTO cc. Here are is some info regarding the two programs and I wonder what your take is…

    Here wi what the CEO said regarding 253 (clinical hold hopefully will be remove din the next 3 months): “253, so we are not inhibiting the bromodomain proteins. We’re not directly c-Myc either. So we’re acting on a three-dimensional DNA structure and the promoter region of the Myc gene. We stabilize that and it turns off the c-Myc gene.” He thinks that this is wy to will be mower than for Bromodomain inhibitors.

    Regarding 806 – he said that in animal testing they have been using 1 gr (which is very high) for 5 consecutive days with no to so far. they will now test for 28 days and expect to find to so that they might have info on dose limits and starting doses. How do animal data translate to humans?
    Regarding differences with Ibrunitinb, the CEO of APTO states: “(with ibunitinib, you don’t kill the cells until you get up to 10 micromolar. So it’s a general toxicity to the cells. So it shows that just by inhibiting BTK in those cells does not directly kill the cells. However, if you treat with 806 what we see is nanomolar killing of the cells, so on average we’re about 1500 that’s 1,500 times more potent in directly killing the cells than is ibrutinib.”

    Any opinions on this, or we just have to have patience and see ph1 in humans?




  14. Hello Ohad,
    Re: ARRY, besides the good Phase 3 COLUMBUS trial data,
    The ARRY-LOXO partnership, where larotrectinib rolling NDA was completed in March. LOXO market value of $3.34 B (nearly the same as ARRY) is undoubtedly heavily premised on trial results of larotrectinib (which is an ARRY discovery). LOXO has essentially tripled in market value in just the past year, probably mostly due to trial results of the ARRY drug.
    Then all of the other promising drugs like selumetinib (with AstraZeneca)… begs the question if ARRY might actually be undervalued at this level?
    Your thoughts are always appreciated, thanks


  15. Andre (UNUM) – Still didn’t have a chance to read their S1. Unfortunately, patient deaths have been reported for all CD19 CARs so not sure this is a show stopper.

    dany (AIMT/ANAB) – Not following them closely. ANAB’s AD data are compelling but they are far from the market and will face competition from dupilumab and other IL13/4 antagonists.

    Harold (ADXS) – Personally I am not a big fan of vaccines, especially not ones targeting shared epitopes. So far , they simply haven’t worked in humans with metastatic disease.

    DAn (APTO) – Thanks. I am still skeptical about both, a lot of hand waving based on limited preclinical data…

    Roy – Thanks!

    Lawrence (ARRY) – The COLUMBUS data were really impressive. Not sure how significant the exposure to LOXO is, but it shouldn’t be meaningful near term. Next important catalyst in BRAF+ CRC which is 18-24 months away.

    cg (BMRN) – I usually focus on companies with lower market caps. For BMRN, their HemA could be first to market and ONCE does not look like such a threat but I am not optimistic about their commercial franchises that could be displaced by gene therapy. This applies to all enzyme-replacement therapies in the long run.

    Xavi (AFMD) – Tanks. They seem to have good bsAb tech but I am not excited about their approach to engagae NKs. So far clinical data with CD30 is underwhelming.

    Peter (BPMC) – Not sure… Their KIT/PDGFR program looks like a drug but valuation is quite high. Anxious to see their RET data at AACR.



  16. hi Ohad

    at which level would you find entering INCY interesting if one removes the IDO-inhibitor from the valuation?

    what value do you assign to Jakafi?



  17. “There are early new IO targets I find interesting but unfortunately I cannot discuss them.”

    Lets Parse This eXample ? 🙂


  18. Ohad In regards to AFMD and their CD-30 tetravalent bispecific engager. An ORR of 89%, double the CRR with Keytruda is underwhelming? Am I missing something or misinterpreting the data here?

    Also a CR, PR and SD in 3 patients on low dose 1.5mg/kg in CL not impressive?
    they seem to be pioneers in NK-Cell engagement. The data looks stellar to me.


  19. Thanks Ohad
    AVXS was a great pick. Also RGNX and BOLD are up nicely this morning.

    Curious to see where you are going to put $55K from AVXS.
    Maybe you will finally get some SGMO and VYGR 🙂


  20. AVXS, i bought on a big down day maybe in january then sold it before the market slide down in march for a nice profit along with almost all my high tech biotech holdings. then have been buying most back at low prices for 2 weeks including AVXS last friday afternoon.
    AVXS is a one day big gainer.
    thanks twice Ohad !


  21. Christian (INCY) – It’s still to expensive assuming Jakafi stays the only Jak inhibitor for MF/PV (need to keep an eye on CELG). I would like to see one of their pipeline drugs advancing towards meaningful markets but so far the only one I am familiar with is the FGFR in cholangiocarcinoma. Their JAK inhibitor for inflammation will face stiff competition imo (see ABBV’s data yesterday) and LLY will get most of the upside anyway.

    Gene Mc – Sorry, didn’t get it….

    Jaime Allen (AFMD) – An ORR of 89% is very high obviously but we don’t know what was their drug’s contribution. Initial data with Opdivo in HL weren’t much lower.

    Christian/paul/Emmanuel (AVXS) – Thanks!

    andre (SGMO/VYGR) – For some reason it’s very difficult for me to jump the zinc finger wagon, just don’t think it’s a viable approach. VYGR I like despite the recent iffy data, they have a deep pipeline and new vectors. It’s hard to find new reasonably priced biotechs even after the correction…

    Garry Xo (RGNX) – Thanks. Hope this one in partivular lives up to expectations



  22. GERN (Geron) looks like a compelling opportunity for MF and MDS indications with a recent third positive internal review of results. The big “if” is now the nod by partner Janssen of J&J for green light with the project to be announced in a few months.
    If given, this drug (imetelstat) has the potential to rival both INCY and CELG, which could be overwhelming..
    Do you think the odds are in favour of Janssen deciding to go ahead with the project?


  23. Hey Ohad
    Great job with your Gene therapy calls!
    I wish I had invested in AVXS… but ABEO, ADVM and RGNX are doing very well too… so cannot complain! Thanks. NITE and KRYS are the only two picks in GT you made that have not moved up in valuation and wonder if you are giving them a second look, especially NITE–hey added a program and are in phase three with their lead one.

    Any opinions on AUPH – they have added two indications (including dry eye – which might be interesting given the patent issues for restasis).



  24. Ohad,
    Can you comment on CELYAD (CYAD). Their IP in the CAR-T space plus their clinical program might make them a value play given their 300M market cap.
    Thinly traded so not on everyone’s radar.


  25. Ohad,

    I wonder if you have an opinion on BGNE and BPMC. Both have kinase assets, stock got huge boost recently. What’s your acceptable entry point?




  26. Hi Ohad,

    Congrats again on AVXS!! What are your current thoughts on XENE? Do you think it’s still a good time to buy?



  27. Ohad
    I know your opinion about VYGR & SGMO. My question was not about them but about what you are going to do with the cash from AVXS. Stay in cash?


  28. Ohad. Did you see the note from Goldman Sachs on how gene editing/therapy companies may be so successful they may have such a large impact that they could change the whole industry? That said don’t you need to have some significant exposure to Crispr stocks? I know you said you are waiting because they are expensive with no revenue but don’t you have to have exposure to them? The could impact every biotech stock! What do you think?


  29. Hey Ohad

    BPMC has $4.5B market cap. Quite extraordinary for a company in phase 1. I am puzzled by this. How is the market cap justified? And then the next question is, why are other companies in ph1, too, such as SYBX or MGEN, and plenty others with innovative platform technology, have market caps of $200M or less.


  30. Okay, I can see that RET (which BPMC and LOXO are both going after) is taunted as the next big thing – and AACR posters are proving this. LOXO valuation is still below BPMC, in spite of having a drug close to approval.


  31. Laurence (GERN) – This drug has been out there for years… initial data were intriguing but I am not sure the effect is real.

    DAn (NITE/KRYS) – I don’t plan to add more without additional data or a signficant drop in valuation. It is hard to find reasonably priced biotechs these days…

    AUPH – Need to check, haven’t followed them for a while. Overall, still not optimistic about their drug.

    Frank (CYAD – Sorry don’t know them well.

    Jinyu (BGNE/BPMC) – I thought they were overpriced one year ago, they stocks moved up considerably and BPMC’s RET data look good but it is still hard to justify at these levels imo.

    Jerome (XENE) – Thanks. Yes I still like the story, plan to write about them soon.

    Andre – That’s a very good question… Honestly speaking I am struggling to find new names to add to the portfolio. Valuations are very high…

    Mike W – Yes I did. That’s a fair point and I have been contemplating it during the past year. My main issue is not only valuations but dev stage, the first programs will only enter the clinic this year so I prefer to wait given the lack of near term catalysts.

    DAn (BPMC/LOXO) – Agree about valuation but BPMC is an ocean apart from companies like SYBX and MGEN that don’t have a product with a clear route to market.
    LOXO – I think they will release data only at ASCO so we need to wait. Their market cap is capped by the Bayer deal so they will probably need additional value drivers.



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