Stockmoney Lizards Newsletter - Issue #1
Editorial
Dear stockmoney hunters and biotech lovers,
Congratulations on following us and welcome to our weekly newsletter “Stockmoney Lizards”! It is all about stocks, the market, trading ideas and updates on selected stocks that we think are worth following. In this first issue, we will explain to you why this letter will be helping you Stop losing money and significantly increase your return on investment. But first, we will start with a biotech-associated market report and our first stock recommendation for the year 2022. At the end there is a short FAQ interview, to get right to the point, answering the most important questions. Stay tuned, your Lizards.
Index
Biotech market report
Stock report - AnaptysBio: A successful developmental stage biotech with capital-efficient business model
FAQ
Biotech market report
A lot happened in the biotech sector in 2021, even though the #XBI was on a dive. The global COVID-19 pandemic is entering its third year. 84 novel active ingredients (NAS) were first launched globally in 2021, twice as many as five years ago. Eight COVID-19 vaccines or therapeutics were approved by the FDA. Oncology, neurology and infectious diseases accounted for 60% of all NAS (197 of the 330 new launches), up from 49% five years ago. There was a slowdown in Phase I drug growth in 2021 due to uncertainty, closed outpatient clinics, and study sites. Gene editing, CAR-T and cell therapies continue to be the focus, with 804 next-generation biotherapeutics in development as of Phase I 2021.
The number of covid trials logically increased. COVID-19 vaccines and therapeutics led to more than 1200 trials. We will soon be in the endemic phase of Covid research as well. 15% of Covid trials are planned but not active (this number has increased in recent months and may be a sign of funding difficulties), and 43% are either completed or discontinued. Of the completed trials, there are 31 vaccines and 9 new therapeutics to date!
At an average of 5%, the success rate for trials is at its lowest level in more than 10 years. This means that only 5% of drugs make it to a successful registration trial. Stock picking on an asset basis is of increasing importance, although impacted by other factors.
Notwithstanding the performance of the #XBI and biotech companies, there continues to be a run through IPO's. On the one hand, this is an expression of the high innovative power of the sector, but also here there are many black seeds that are heading straight down the path of the money death spiral.
Taken together, the biotech sector is prospering and Covid implications will soon be history. Stock picking is currently highly interesting and #XBI will catch up massively again. There has probably rarely been a better time to invest your money in biotech.
Stock report - AnaptysBio: A successful developmental stage biotech with capital-efficient business model
Anaptys Bio ($ANAB, share price at closing 17 Feb 22: $29.93, -3.08%)
Rating: Bullish, Selling zone above 60$
Key facts
The company
AnaptysBio is a San Diego based clinical-stage antibody development company advancing therapeutic antibody product candidates focused on unmet medical needs in inflammation.
Research and development pipeline
AnaptysBio owns a platform that is used to design therapeutic antibodies to treat various immunological diseases as well as various types of cancer. The platform uses the natural process of somatic hypermutation (SHM) that is embedded within the human immune system to rapidly develop a diverse range of therapeutic-grade antibodies in vitro.
The pipeline
The lead asset is JEMPERLI (dostarlimab) which is an anti-PD-1 antagonist targeting the tumor microenvironment. Commercial rights have been sold to GlaxoSmithKline (GSK) / Sangard. However, AnaptysBio is still receiving revenues from royalty payments. Other, earlier-stage (Phase 1 and 2) oncology and inflammatory assets are also partnered with GSK and BMS (CC-90006, GSK4074386, Cobolimab).
Besides the partnered assets AnaptysBio holds full commercial rights to its inflammatory program including Imsidolimab (ANB019) which is in Phase 2 and 3, respectively, for several indications, Rosnilimab (ANB030, alopecia arreata, Phase 2) and ANB0300 for various inflammatory diseases.
Financials
estimated as of Jan 2022:
- Cash of ~$ 600 m
- debt: ~$20 m
- shares outstanding 27.5 m
- MCAP ~$850 m
- Enterprise value ~170m
License deals:
- 12-25% royalties of JEMPERLI sales on global sales >$1 bn
- Estimated peak annual global JEMPERLI sales of approximately $1.4-$2.8 billion → $48 - $216 m in peak annual revenues for AnaptysBio
- 10/2021: AnaptysBio sold portion of JEMPERLI royalties for $250 m upfront to Sagard
- BMS deal: milestone payments of up to $53.0 million per target, low single-digit royalties on net sales of antibodies against each target, and reimbursement of specified research and development costs.
The chart, support, resistance
- continued uptrend since 2019
- Support levels at $30.15 and $27.40, resistance at $31 and $37
- consolidation at low volume between $30 and $31
Management / Investor base
Management
CEO: Hamza Suria (since 2011)
- track record of transforming pipeline from early-stage to approved therapies
- great deal-making record
- capital and shareholder oriented focus
Ownership
>90% institutional ownership, top shareholders EcoR1 Capital LLC, Tang Capital and Blackrock.
The biggest portion of shares are held by Oleg Nodelman’s EcoR1 Capital, LLC. Nodelman is known as one of the top investors in the biotech space. He has a unique track record with his strategy to invest in "un-followed, unloved, misunderstood and generally orphaned" biotechs. A list of EcoR1 Capital’s holdings can be found here.
Rating
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Your #lizards
Next issue highlights
Scheduled Friday, 4 March 2022
Biotech weekly roundup
Updated sample portfolio
New stock coverage
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Disclaimer:
We may have beneficial long & short positions in the shares of the stocks presented here. It expresses our own opinions regarding trades. It’s no investment advice. We are not receiving compensation for it. We have no business relationship with any company whose stock is mentioned here.
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