Biotech's FutureWritten by Ophir Gottlieb
A lot of the information we're about to cover might feel like a surprise. In many ways it is. That's because our purpose is to provide institutional research to all investors and break the information monopoly held by the top .1%.
Drug pipelines and research & development (R&D) are the life blood of biotechs and pharmaceuticals companies. Let's examine the large caps and rank them on the number of Phase III and Phase II trials in progress and finally, look which companies have dedicated the most to R&D.
A Phase III trial occurs when a drug or treatment is given to large groups of people to confirm its effectiveness, monitor side effects, compare it to commonly used treatments, and collect information that will allow the drug or treatment to be used safely.
After these trials companies move to the formal step called New Drug Application (NDA). In this step a drug sponsor takes the results to ask that the FDA to consider approving a new drug for marketing in the United States.
Here we chart all of the biotech and pharma companies with market caps above $5 billion and rank them by the number of Phase III trials they have in progress:
The narrative has been for a long time now that Gilead Sciences Inc. (NASDAQ:GILD) is out of ideas, out of products and holding onto a few blockbuster drugs with no growth. Perhaps that narrative has missed the more than sixty Phase III trials the company has in place.
We have also highlighted Celgene Corporation (NASDAQ:CELG), Amgen Inc., (NASDAQ:AMGN), Biogen Inc. (NASDAQ:BIIB) and Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) -- the rest of the "big five" biotechs.
A Phase II trial occurs when the drug or treatment is given to a larger group of people to see if it is effective and to further evaluate its safety. It's usually the step before a Phase III trial.
Next we chart all of the biotech and pharma companies with market caps above $5 billion and rank them by the number of Phase II trials they have in progress:
Here we see that Pfizer (NYSE:PFE), a mega cap pharmaceutical company, and Celgene (NASDAQ:CELG), a large cap biotech, have the most Phase II trials. Again, for convenience we have highlighted Amgen, Biogen and Regeneron.
RESEARCH AND DEVELOPMENT
Finally, we can turn to R&D and see which of these companies spends the most on innovation for every dollar of total operating expense. Here is the chart:
Incredibly, Alnylam Pharmaceuticals (NASDAQ:ALNY) spends $0.82 out of every dollar on R&D. While we have highlighted the super stars of the biotech world again in this chart, we also highlight one of the most incredible companies in the world -- Illumina, Inc. (NASDAQ:ILMN). This is the company that is single handedly leading the genomics revolution.
According to next BIG Future, "in the 13 years since the conclusion of the Human Genome Project, [Illumina] pushed the cost and time of sequencing a full human genome from $3 billion and 10 years to $1,000 and mere hours.
Illumina is a marvel.
SEEING THE FUTURE
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These are just two of the themes we have identified and this is just one of the fantastic reports CML Pro members get along with all the visual tools, the precious few thematic top picks for 2016, research dossiers and alerts. For a limited time we are offering CML Pro at a 90% discount for $10/mo. with a lifetime guaranteed rate. Join Us: Get the most advanced premium research delivered to your inbox along with access to visual tools and data that until now has only been made available to the top 1%.
The author is long Celgene and Illumina shares. Thanks for reading, friends.
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