Fortnightly Publication Highlighting Latest Insights From IRF Providers
Company Research
Alpha generating Healthcare shorts
Healthcare
Bios' top 5 short ideas for 2024 had an 80% hit rate with Moderna the standout performer (down ~60%). For 2025, they select: 1) ~$13bn facilities and services company to be materially impacted by changes in reimbursement and by the growth in GLP1. 2) ~$6bn medtech company to be significantly impacted by new competitive launches. 3) ~$20bn commercial pharma/biotech company to suffer a notable decline in sales y/y and poor regulatory environment. 4) ~$3bn healthcare services and development company that is grossly overhyped and is burning excessive amounts of cash. 5) ~$1.5bn commercial launch failure in the biotech space that is grossly overhyped and could see greater than 80% decline in 2025.
Edition: 203
- 24 January, 2025
Healthcare
There has been much excitement around Merck and MRNA's latest cancer vaccine after ASCO, with data appearing impressive. However, Foveal Research’s latest report suggests otherwise, with the vaccine Keytruda combo performing similar to historic Keytruda alone, along with an unusual underperformance of the control arm that flatters results. Secondary endpoint at ASCO reveal the real concerns over the true treatment effect of MRNA's addon. Dr Amit Roy pitched this idea at our recent Equity Shorting Conference. Click here to listen.
Edition: 170
- 29 September, 2023
Healthcare
MRK's flagship cancer treatment, Keytruda, is under patent until 2028, and as a biological, has a stronger economic moat than the market recognises. Valens believe the market appears to be understating Keytruda’s total market opportunity as the number of approved indications continues to increase. New indications have the potential to grow Keytruda’s target market substantially, which could boost revenues 10%-25%+ annually. It’s currently used in several collaborations with pharma and biotech companies like Moderna. These combination therapies add to Keytruda’s competitive moat, as they mean any potential generic would need to get approval for the same combination therapies to be disruptive.
Edition: 168
- 01 September, 2023
Short Shots
Is a collection of technically vulnerable charts culled from the “Negatively Inflecting” and “Toppy” columns within Vermilion’s Weekly Compass report or from various technical screening processes. The charts contained in this report have developed concerning technical patterns that suggest further price deterioration is likely. For these reasons Short Shots can also be a great source of ideas for investors interested in short-selling candidates.
Charts highlighted include Corteva (see above), Enphase Energy, General Mills, Kraft Heinz, Hershey, MarketAxess, Moderna, Newmont, Penumbra, Roblox, SolarEdge and Valmont Industries.
Edition: 167
- 18 August, 2023
Healthcare
In newly published data from MRK / MRNA’s PD1 + mRNA cancer vaccine trial at AACR last week, headline efficacy may be flattered by Keytruda alone control arm underperformance by c.11% compared its historic phase III performance, with the vaccine combination arm performing similar to previous monotherapy Keytruda alone trials, suggesting the phase III confirmatory trial may have a higher than expected hurdle to beat.
Edition: 159
- 28 April, 2023
Healthcare
Concerns surrounding the appointment of Jorge Gomez prove justified as the new CEO lasts one day on the job after probe at former company. Last month, Paragon Intel described Gomez as a "Career underperformer" - his career alpha destruction is nearly (-103%) compared to outgoing CFO David Meline who created positive alpha totalling +181% at all three C-Suite positions during his career. Gomez also has a history of concerning audit, financial, and governance red flags, enduring material impairments each year he held a CFO role dating back to 2018. His ManagementTrack rating is very low at just 2.5 vs. Meline's 7.6 and the platform average of 4.9.
Edition: 136
- 27 May, 2022
Unloved Biotech
Healthcare
While Aaron Fletcher writes a lot of short research (with a focus on the 3 F’s - Fads, Fakes and Frauds), following the worst alpha year in biotech history, he currently sees the biggest opportunities on the long side. Aaron compares the sector to how energy was in the second half of 2020, when no one wanted to touch it. He expects M&A to pick up significantly later this year. IRF recently hosted a conference call with Aaron where he discussed his top picks for 2022 including TFF Pharma, Taysha Gene Therapies, Aptose Biosciences, IN8bio and Lantern Pharma. On the short side he highlights Ocugen and Moderna.
Edition: 130
- 04 March, 2022
Market moving legal disputes…
MDC's “Event-Driven Legal℠" Weekly Report summarises near-term legal events including analysis on their potential as share-price catalysts for the indicated companies. Recent coverage includes:
Arbutus Biopharma and Genevant Sciences recently filed Patent Infringement Lawsuit against Moderna seeking licensing fees for the manufacture and sale of Moderna’s vaccine for COVID-19.
IDT Corporation's Defense of a shareholder lawsuit challenging the repurchase of an Indemnification Claim from Straight Path Communications that spared it from having to pay $614m in FCC fines.
Sonos and Alphabet's continuing battles at the US International Trade Commission and US District Courts.
Edition: 130
- 04 March, 2022
Healthcare
ABUS should experience high volatility when the US Court of Appeals for the Federal Circuit issues its Decisions in Appellate Case Numbers: 20-1184 & 20-2329. Although Decisions may still be a few months away, these Patents relate to a Nucleic Acid delivery system comprising of a composite of multiple lipids. This delivery system appears to have ranges that overlap with Moderna's recent Covid-19 Vaccine; and therefore, ABUS may have grounds for an eventual Patent Infringement lawsuit.
Edition: 123
- 12 November, 2021