Release date: 2015-12-09
This week, UBS global chief investment officer Mark Haefele, who manages $2 trillion in funds, also said that cancer immunotherapy will be one of the next most promising long-term investment themes, with an expected attractive return on investment. .
Immunotherapy provides a cure for cancer
Immunotherapy is an increasingly popular cancer therapy in recent years. To put it simply, the immune system recognizes cancer cells and initiates attacks. The body's immune system is usually chosen to ignore cancer cells, and research on immunotherapy over the past few decades has been to overcome this problem.
Some therapies produce a protein component that labels cancer cells for the immune system to recognize. Other therapies include extracting the most effective anti-tumor leukocytes from the patient and genetically modifying these white blood cells to specifically attack cancer cells.
When the clinical trials of immunotherapy began to show results gradually a few years ago, this treatment method began to become the focus of public attention. In 2013, pharmaceutical company Bristol-Myers Squibb found in clinical trials that immunotherapy increased the lifespan of 22% of 1800 patients with advanced melanoma by 3 years. The two drugs developed by Yervoy and Opdivo have produced encouraging results. At that time, cancer immunotherapy was also ranked as the top of the top ten scientific breakthroughs in the world by the international top magazine Science.
Jennifer Couzin-Frankel of Science magazine wrote: "For the medical practitioner, there are many people who see their patients lose their lives due to advanced cancer every day, and this cure rate was simply unimaginable a few years ago."
“As the population ages, the cancer treatment market is expanding rapidly, and government, insurance institutions, and individuals are increasingly investing in life extensions,†Haefele said. “Between 2010 and 2014, cancer patients in the United States, Germany, and Canada. Per capita spending has increased by 60%."
According to Credit Suisse's forecast, by 2020, the average annual income of immunotherapy will reach 8.5 billion US dollars, which is more than half of the total operating income generated by all New York companies in 2014.
For many patients who have tried various traditional therapies, immunotherapy has given them new hope, but the average cost of immunotherapy in the United States is expected to be almost twice that of ordinary therapy.
“Early immunotherapy may be expensive – each patient can cost as much as $10,000 a year,†Haefele said.
Nova of the Wall Street Biotech sector
In the past five years, American biotechnology companies have achieved leapfrog development. Venture capital, IPO, financing and M&A activities in such industries are very active. From 2013 to the present, the Nasdaq Biotechnology Index has risen by about 500% (about 200% of the composite index), especially in the cancer immunotherapy sector.
In fact, Wall Street has already smelled business opportunities. In 2013, Goldman Sachs reminded investors to focus on the field of cancer immunotherapy. Earlier this year, Standard & Poor's released a report that included five cancer immunotherapy agents in the most promising drugs in 2015 and said it would continue to increase its investment in this area. In fact, such immunotherapeutic drugs have never been included in this list until 2009.
Since March of this year, a Langke Cancer Immunization Index (LCINDX) has been released, consisting mainly of 25 companies that have adopted relevant technologies. In October, the first ETF to track the stock of cancer immunotherapy companies, the Loncar Cancer Immunotherapy Index, has also started trading on the Nasdaq.
Juno is the hottest startup in the field and first publicly listed on Nasdaq for $24 a share in December 2014. Juno then launched three immune cell therapies and quickly grew to be a leader in cancer immunology. As of this Thursday, the company's stock price is 55.83 US dollars, a year-to-year increase of 133%. Another biopharmaceutical newcomer, Kite Pharma, has risen from $28 in October 2014 to the current $73.25, an increase of about 162%. Bluebird bio, which focuses on the development of rare disease gene therapy, has grown by as much as 108% since December of last year.
Some of the treatments of these three companies are very complicated, expensive, and cause some serious side effects, many of which have not yet been approved. But these treatments have shown dramatic results in early clinical trials of leukemia and other blood cancers, and developers are racing to expand these technologies into other cancer therapies.
In fact, medical researchers around the world are working hard to develop a variety of cancer immunotherapy, combined with traditional therapies to help patients escape the disease.
David Bonderman, founder of TPG Capital, is the fourth largest shareholder of Kite. At the beginning of this year, his personal investment accounted for 6% of the company's shares. Its investment market value has soared to 200 million US dollars.
The fund management company of Soros is the 11th largest shareholder of Kite, with a shareholding of 1.7% and a purchase price of $30 at the time.
The Arch Venture Partners fund company occupies half of the pharmaceutical company Juno. Its co-founder, Robert Nelsen, said that Amazon founder Jeff Bezos and Microsoft co-founder Paul Allen also invested in Juno. Nelsen pointed out that he has been investing in biopharmaceutical companies for 28 years, and this is the first time he has seen doctors struggling with the cure for terminal illnesses show their smiles because of immunotherapy.
In the US stock market, pension funds and venture capital funds also invest heavily in the immunotherapy sector. The Alaska Permanent Fund is one of Juno's early investors, with a stake of approximately 30%, and a net worth of approximately $1.1 billion at the time. Even if the current global stock market volatility, the fund company insists on holding these shares.
14% annual growth rate
The origins of immunotherapy theory can be traced back to the 19th century. In the late 1980s, French researchers discovered a receptor called CTLA-4 on T cells. James Allison, a pioneer in cancer immunotherapy, discovered that this receptor prevents T cells from attacking the invaders, which can help kill cancer cells. Professor Paul Ehrlich, a medical Nobel laureate, also predicted in 1990 that antibody molecules that bind to tumor cells will play an important role in cancer therapy.
Dr. Allison is currently the director of the Cancer Center at the Anderson Institute of Immunology at the University of Texas. He discovered the natural inhibitory mechanisms of the immune system and developed a monoclonal antibody therapy that promotes the immune system against cancer, which is for patients with melanoma. Come to the Gospel and pave the way for the successful development and listing of Yervoy of Bristol-Myers Squibb.
In 2010, the US FDA approved the first cancer immunotherapy drug, Provenge, a tumor vaccine for the treatment of advanced prostate. After clinical trials, this treatment can prolong the life of patients for 4 months. In 2011, the FDA approved the monoclonal antibody ipilimumab, a negative co-stimulatory factor inhibitor, for the treatment of metastatic melanoma.
In 2014, Blincyto, a new anti-cancer drug against leukemia developed by biopharmaceutical giant Amgen, was approved by the FDA. Astra Zeneca, a big-cap pharmaceutical company, now has its own immunotherapy platform. In August, the company reached an agreement with Sosei's biotechnology division on immunotherapy trials, which could be worth up to $500 million.
In recent months, Keyruda, a new immunotherapeutic drug against lung cancer developed by German pharmaceutical giant Merck, has also been approved by the FDA. Today's beleaguered Canadian pharmaceutical giant Valeant can also produce Provenge, an immunotherapeutic drug against prostate cancer. This week, according to Business Insider, another new type of immuno-oncology drug from Bristol-Myers Squibb has been approved by the FDA.
In the United States, the cancer immunotherapy industry is growing at a rate of 14% a year, and within a few years its industry will reach $35 billion. For example, Keytruda's sales are expected to reach $1.5 billion in 2017, and the sales of such drugs may increase as other cancer treatments develop.
Haefele said: "We believe that there will be new drugs listed in the next two years, and their sales potential will be worth billions of dollars. Those companies highly related to immunotherapy are likely to bring higher than GDP income. Growth, investors can also get a higher return on investment and a growing dividend."
CAR-T therapy
Broadly speaking, cancer immunotherapy mainly includes three major contents, Cell-based therapies, Antibody therapies, and Cytokine therapies. Among them, CAR-T (T cell chimeric antigen receptor) as an immune cell treatment program has attracted a lot of attention from research institutions, doctors, patients and investors worldwide.
The principle of CAR-T is that T cells modified by chimeric antigen receptor can specifically recognize tumor-associated antigens, making the targeting, killing activity and persistence of effector T cells higher than those of conventionally used immune cells, and It can overcome the local immunosuppression microenvironment of the tumor and break the host immune tolerance state.
At present, the research and development of CAR-T therapy abroad is in full swing. The main related companies include Novartis, Juno, Bellicum, and Kite Pharma. In July 2014, the FDA granted Novartis's personalized CAR-T cancer therapy CTL019 breakthrough drug certification, and hopes to promote this therapy research. It is understood that the entire course of CAR-T will last for about 3 weeks, and the cell "extraction-modification-amplification" takes about 2 weeks and takes a long time.
In fact, the current CAR-T cell therapy technology is still in the clinical trial stage internationally, and there is no relevant legal norm in China, so there is no charging standard. Professor Carl June, the inventor of the therapy, said: "CAR-T technology began its first clinical trial in 2010, and it is estimated that the US FDA passed in 2017, only seven years, which is very fast."
According to major analysts, the market for cancer treatment based on CAR-T cells may reach 35 billion to 100 billion US dollars.
Immunotherapy in China
According to relevant media reports, many hospitals in China are conducting cancer immunotherapy, and it is difficult for many cancer patients to be tempted by it. Some hospital directors said that there are many large hospitals in China that are implementing this therapy. However, the efficiency of this therapy is also demonstrated by clinical research. As far as the existing data are concerned, it is not effective for all patients. And its cost is still high, a treatment needs about 30,000 yuan, sometimes three or four courses.
On October 9, 2015, Chen Wanqing, director of the National Cancer Center, led the team to publish cancer statistics of residents in China for the first time in the internationally renowned cancer journal Cancer Letters. The results showed that the number of cases diagnosed as cancer in China within 5 years and still surviving was about 7.49 million, and the overall 5-year cancer prevalence rate was 556/100,000. In addition, the number of leukemia patients diagnosed as cancer in China within five years and still alive is 117,300, and the number of patients with lymphoma is 157,600. Considering the outstanding efficacy of CAR-T on hematoma, according to the domestic treatment cost of 100,000 RMB per person, the potential market size of CAR-T therapy in these two major hematomas exceeds 25 billion yuan.
Up to now, there are 76 CAR-T clinical trials underway, including 48 in the US, 19 in China, 7 in Europe, and one in Japan and Australia. Although some domestic CAR-T technologies are still relatively backward and R&D is relatively extensive, the breadth and depth of research and development are among the highest in the world.
According to data from Founder Securities, nearly 200 companies in China currently use traditional adoptive immune technology for clinical treatment of cancer. Generally, a business model that provides medical cell therapy technology services to medical institutions and charges a service fee is adopted. The hospital pays the company's technical service fee, and the company does not participate in the patient's diagnosis and treatment, nor does it charge the patient directly, just as a technology supplier for the in vitro culture of the cell.
Some cancer patients need to pay attention to the fact that in terms of immunotherapy, China still lacks complete and complete clinical trials. Moreover, there is no relevant approval route and management norms. The immunotherapy performed by the top three hospitals in China is basically in an anarchic state. ".
According to the research of Founder Securities, in the A-shares, domestic pharmaceutical companies have not directly carried out CAR-T research, but they have gradually begun to get involved through mergers and acquisitions. For example, Hengrui Medicine, a leading domestic innovative pharmaceutical company, established Hengruiyuan Zheng Biotechnology Co., Ltd. in cooperation with Shenzhen Yuanzheng Cell Co., Ltd. this year to start the development of immunotherapy. Anke Bio also entered the field by working with Boshengji. In the New Third Board, Shenzhen Heyikang has also carried out basic research on CAR-T treatment based on traditional immune cell therapy and made some progress.
Invest in areas you are familiar with
Cancer immunotherapy is a very complex field that is not well understood by many experts. As an investor in this field, especially for retail investors, we must understand the basic functions and potential value, and understand what research and clinical trials these scientists are doing for immunotherapy.
For long-term investors, the investment in the biopharmaceutical sector can see very significant returns, and some big-value, mature companies like Merck, Bristol-Myers, Amgen will be a relatively safe choice. Of course, lower volatility corresponds to a relatively small rate of return, which is a better strategy for investors with low risk appetite.
For investors with high risk appetite and hoping for greater returns, there are many opportunities for start-ups in related industries. Investment in biomedicine requires investors to do more research and analysis, at least to know their main products, industry advantages and risk exposure.
Cancer immunotherapy is a challenging area for researchers and investors. On the basis of its existing success stories, immunotherapy is constantly changing and developing. The opportunities that exist are not negligible, and more and more professional investors will participate in such investments. As Peter Lynch said, “Invest in what you know.†If you want to invest in the concept of cancer immunotherapy, I believe that the investment made on a well-known basis will pay off even more.
Source: Tiger Finance
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