Wednesday, February 28, 2018

An Integrated BioSci Alpha Intelligence On Mallinckrodt Pharmaceuticals: What The Fiscal 2017 Earnings Foretell?

Summary

Q4 2017 earnings show promising results that signaled robust upcoming growth.
The Succampo acquisition for Amitiza and other phase 3 molecules will close in Q1 2018. And, the aforesaid catalyst is most likely to deliver substantial growth.
Amitiza can generate roughly $1B in the foreseeable future while other acquired late-stage therapeutics to add further value.
Highly favorable valuations and a strong balance sheet.
Significant insider purchases and share buybacks signify tremendous unlocked value.
This matter of training oneself not to go with the crowd but to be able to zig when the crowd zags, in my opinion, is one of the most important fundamentals of investment success. - The Father of Growth Investing (Philip Fisher)
On Feb. 27, 2018, the shares of Mallinckrodt Pharmaceuticals (NYSE:MNK) - the specialty pharma that spun off from Covidien (NYSE:COV) in 2013 - traded $2.47 (+15%) higher at $18.86. The aforesaid rally is due to the robust earnings reported for Fiscal 2017. In this report, we’ll go over key earning highlight as well as what investors can expect going forward.
Figure 1: Mallinckrodt stock chart. (Source: StockCharts).

Fundamentals Analysis

In 2013, Covidien (NYSE:COV) spun off Mallinckrodt to maintain its emphasis on medical devices. As follows, the United Kingdom-based firm, Mallinckrodt then focuses on the innovation and commercialization of branded and generic medicines. Accordingly, the company is servicing various markets such as autoimmune, neurology, rheumatology, nephrology, ophthalmology, pulmonology, respiratory, and anesthesiology (as shown in figure 2). Of note, the generic subsidiaries include active pharmaceutical ingredients, biologics, medicinal opioids, controlled substances, and acetaminophen. On the other hand, the branded franchises feature corticotropin injection (Acthar Gel), nitric oxide gas (Innomax), acetaminophen injection (Ofirmev), Therakos photopheresis, fibrin sealant (Raplixa), surgical sealant (Preveleak), and topical thrombin (Recothrom).
Figure 2: Branded products portfolio. (Source: Mallinckrodt).

Earnings Highlight

For Fiscal 2017, Mallinckrodt procured $3.22B net sales, which is 4.7% lower than $3.38B last year. One of the reasons is that 2016 has an extra selling week. In addition, the ongoing pressure in the generics segment contributed to the slight decline. That aside, the diluted earnings per share (“EPS”) from operations were $18.09 compared to $4.39 for the year prior, thus reflecting the benefits from tax reform and other corporate reorganization). Additionally, the adjusted diluted EPS were $7.49 compared to $7.85 for the same period of comparison.
As for Q4 2017, the branded therapeutics segment delivered $582M net sales compared to the $603M a year ago, thus representing -3.7% decline (as depicted in table 1). The generics segment brought in $196M and $213M for Q4 2017 and Q4 2016, respectively (thereby, signifying the -8.5% decreased). Despite not falling off the cliff as what the market seemingly believed, both the generic and branded segments continue to experience significant growth decline (as illustrated table 1 below). The cooling off re Acthar Gels’ growth is due to the previously disclosed patient withdrawal issue. In response, the company implemented various approaches to address the issue mentioned (i.e. the engagement with payers, prescribers, and patients). Be that as it may, it is not far from the truth that Acthar Gel will continue to experience modest sales decline (if the stated efforts cannot pay off).
Branded Therapeutics
Generics Segment
$582M net sales for Q4 2017 vs $603M for Q4 2016 (-3.7%)
$195.8M in Q4 2017 vs. $212.9M in Q4 2016 (-8.5%)
Acthar Gel: $295.2M vs $325.4M (-9.3%) net sales

Inomax: $125.6M vs $118.2 (+6.1%)

Ofirmev: $78.0M vs $72.5 (+7.6%)

Therakos: $57.2M vs $47.4M (+20%)

Table 1: Quarterly figures for branded and generics segments (source: Dr. Tran BioSci)
In assessing the balance sheet, Mallinckrodt has $1.26B at the end of Q4, which include the total cash and equivalents as well as the revolving credits. This capital will be used to close the Succampo transaction sometimes in Q1 this year. The cash provided by operating activities for the said quarter was $278.8M. In addition, the free cash flow was $244.0M. For the whole year, the corresponding figures are $727.3M and $541.2M, correspondingly. Moreover, the company repurchased approximately 10% of shares outstanding (i.e. 9.4M common shares for $214.0M).
Despite that sales growth has been cooling off (due to the pressure from the generic pricing as well as the slowing down of growth for Acthar Gel), the earnings figures reflect a strong underlying business. Furthermore, the combinations of substantial insider purchases (as elucidated below) and the company’s shares buybacks can only mean that they insiders strongly believe in the company prospects (and that shares are on sales significantly below their true worth).

Insiders Transactions

Per figure 3, Mallinckrodt insiders acquired shares en masse for an extended period of time. As alluded, the most likely reason a company buys its shares is that they believe those shares are trading significantly below their intrinsic value. Interestingly, this view resonates with the wisdom of Peter Lynch: “Insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.”
Figure 3: Mallinckrodt insider purchasing. (Source: OpenInsider).

Fiscal 2018 Estimates

Pertaining to the Fiscal 2018 guidance, Mallinckrodt expects the net sales to increase from 3% to 6% (and the diluted EPS to come in at $6.00 to $6.50) as demonstrated in table 2. 
Table 2: 2018 financial guidance (source: Mallinckrodt)

Final Remarks

Of note, this is the preview of the Integrated BioSci Alpha Intelligence research, published in advance to subscribers of Integrated BioSci Investing (a community of expert physicians, scientists, executives, market leaders, and everyday investors). In the aforesaid article, we took the deep-dive into the data analysis (and elucidate the potential upsides) that you can expect from this firm. If you're an investor (or thinking about investing in Mallinckrodt), it's a good idea to check out the pending catalysts of this firm.
Author’s Notes: We’re honored that you took the time out of your busy day to read our market intelligence. Founded by Dr. Hung Tran, MD, MS, CNPR, (in collaborations with Dr. Tran BioSci analyst, Ngoc Vu, and other PhDs), Integrated BioSci Investing (“IBI”) marketplace research is delivering stellar returns since inceptions. To name a few, Nektar Therapeutics (NASDAQ:NKTR) procured more than 381% profits; Spectrum Pharmaceuticals (NASDAQ:SPPI) delivered over 194% gains; Kite Pharma netted 83%; Atara Biotherapeutics (NASDAQ:ATRA) appreciated +207%. Crispr Therapeutics (NASDAQ:CRSP) garned plus 147%. Exelixis Inc (NASDAQ:EXEL) earned greater than 54% capital appreciation. Our secret sauce is extreme due diligence coupled with expert data analysis. The service features a once-weekly exclusive in-depth Integrated BioSci Alpha-Intelligence article (in the form of research, reports, or interviews), daily individual stocks consulting, and model portfolios.
Notably, we’ll increase our price soon. SUBSCRIBE to our marketplace research now to lock in the legacy price and save money in the future. To receive real-time alerts on our articles as well as blogs, be sure to check out our profile page and CLICK the orange FOLLOW button . Asides the exclusivities, this article is the truncated version of the research we published in advance to IBI subscribers. Further, you can read up on Dr. Tran’s background by following this link. If you'd like to get our other once weekly ideas sent to your mailbox, check out Dr. Tran BioSci and sign up with our mailing list.

Friday, February 23, 2018

Integrated BioSci Investing: CEO Abelardo Fraga To Transition Into The Role Of President Of Business Development

Summary

Abelardo Fraga (“AB”) currently serves as the CEO and Founder of the successful Brazilian firm, AFDatalink.
With wisdom in both business and investing, AB made the stellar calls like Atara Biotherapeutics that delivered over 224% profits for our community.
AB to join IBI as President of Business Development.
IBI to benefit from AB’s high quality thought-process as well as his market and business acumen.
The decades of experience as a top-level executive is the key growth catalyst to power IBI.
I am a better investor because I am a businessman, and I am a better businessman because I am an investor. - The Oracle of Omaha (Warren Buffett)
It is with great honor to introduce to Integrated BioSci Investing (“IBI”) partners, Abelardo Fraga who will join us as President of Business Development. Chief Executive Officer Fraga brings in decades of experience in high-level management as the Founder and CEO of AFDatalink (a Brazilian tech firm that focuses on electronics). Prior to founding AFDatalink, AB served as the Global Account Director for the prestigious firms, Motorola and Alcatel/Lucent Technologies and as a M&A consultant. Moreover, AB is trained in investment management at the University of Geneva-Switzerland as well as investment at Stanford University and the University of Omaha. Furthermore, AB also studied financial evaluation and strategy at the University Illinois at Urbana-Champaign.
Figure 1: Notable bioscience recommendations by CEO Abelardo Fraga (Source: Google Finance)
Joined IBI back in 2017, AB has been advising Dr. Tran on market intelligence and business development. For instance, AB pioneered various programs to push for the robust growth in making our community what it is today. According to Dr. Tran,
AB has one of the best thought processes I’ve witnessed in the investing world in general (and in bioscience in specific). I believe this is due to the combinations of his Master in engineering background with the natural talent for finding multibagger investments. AB demonstrated the similarity to my other teachers by books, Warren Buffett and Phillip Fisher.
With wisdom that spans beyond business development, AB made stellar calls on various firms. Three months prior, AB presented a highly promising thesis on a relatively unknown bioscience, Atara Biotherapeutics. As an oncology-focused firm with substantial unlocked value in its pipeline, Atara has a molecule that functions analogous to the off-the-shelf CAR-T. Leveraging on our strength in data forecasting in combinations with AB’s investing acumen, we presented the bull thesis on Atara. In just over three months, the stock appreciated over 224% profits for our partners. Per AB,
I’ve been a member of Seeking Alpha since the beginning of 2016, and as a growth-oriented investor and I look for authors who can bring both expertise in their field of competence as well as in the financial markets.
I was very fortunate to find the IBI marketplace, and quickly I realized that Dr. Tran is a very talented professional, a hard worker, and customer-oriented entrepreneur. During this time as a subscriber, I got confident that Dr Tran will add more and more value to the investors in the biotech industry.
When he invited me to join the IBI team, it was hard to refute the invitation despite my heavy workload as CEO. I’m excited to work with Dr Tran and the IBI team in this new venture. I’m confident that IBI will bring great investing ideas to the subscribers.
I’m very excited and committed to helping IBI to grow in building value for investors as well as to support therapeutic innovations that deliver hopes to patients worldwide.
IBI is delighted to have AB to direct the prudent corporate growth strategies. With his ingenious mind and tireless efforts, IBI will continue to push for advancement. Ultimately, our work will translate into differentiated intelligence to profits for our partners. As a community of experts, we seek to support bioscience firms that are innovating lifesaving therapeutics, which deliver hopes for countless patients worldwide.
As the final note, we wish to send our appreciation to you all as well as other experts like our colleagues, SA’s editors, Daniel Shvartsman, and Robyn Conti (for the ongoing support and guidance to help us grow).
Author’s Notes: We’re honored that you took the time out of your busy day to read our market intelligence. Founded by Dr. Hung Tran, MD, MS, CNPR, (in collaborations with Dr. Tran BioSci analyst, Ngoc Vu, and other PhDs), Integrated BioSci Investing (“IBI”) marketplace research is delivering stellar returns since inceptions. To name a few, Nektar Therapeutics (NASDAQ:NKTR) procured more than 359% profits; Spectrum Pharmaceuticals (NASDAQ:SPPI) delivered over 167% gains; Kite Pharma netted 82%; Atara Biotherapeutics (NASDAQ:ATRA) appreciated +211%. Crispr Therapeutics (NASDAQ:CRSP) garned plus 110%. Exelixis Inc (NASDAQ:EXEL) earned greater than 51% capital appreciation. Our secret sauce is extreme due diligence coupled with expert data analysis. The service features a once-weekly exclusive in-depth Integrated BioSci Alpha-Intelligence article (in the form of research, reports, or interviews), daily individual stocks consulting, and model portfolios.
Notably, we’ll increase our price soon. SUBSCRIBE to our marketplace research now to lock in the legacy price and save money in the future.To receive real-time alerts on our articles as well as blogs, be sure to check out our profile page and CLICK the orange FOLLOW button . Asides the exclusivities, this article is the truncated version of the research we published in advance to IBI subscribers. Further, you can read up on Dr. Tran’s background by following this link. If you'd like to get our other once weekly ideas sent to your mailbox, check out Dr. Tran BioSci and sign up with our mailing list.

Saturday, February 10, 2018

An Integrated BioSci Investing Partners Reward Program: To Deliver Increasing Value For Subscribers

Summary

IBI Partners Reward program launched to increase the value for our subscribers.
Partners to earn points after staying with us for at least 3 months.
Points are rewarded for new subscriber referral. Quality stock tips and activity in the chat are also honored with points. Those who leave us a positive review also get points.
Points earned can be exchanged for cash monthly.
With certain milestones achieved, partners can gain entry into the VIP program.
Price is what you pay. Value is what you get. - The Oracle of Omaha (Warren Buffett)
Regardless of the tumultuous market this previous week, we’ve procured substantial gains for Integrated BioSci Investing (“IBI”) partners since 2017. If the bear market is to come, you’ll still continue to compound substantial capital if you have a long-term approach. With the 40% cash reserve in the IBI Long-Term portfolio, we’ll be in the position to take full advantage of the opportunities to purchase firms (on sales at significant discounts to their intrinsic values (if the recession will come soon).
Figure 1: Notable IBI performers. (Source: Google Finance)
Without further ado, let’s shift gear into the next growth catalyst. And, it is an honor to introduce you the Partners Reward (“PR”) Program - a new implementation that is seeking to deliver increasing value for our community of experts (physicians, scientists, fund managers, investment advisors, executives, market leaders, and everyday investors).
As follows, the program is based on a system that honors partners with points to be accumulated over time for rewards (including cash as well as the entry into our VIP Partnership). Later, we’ll go over how you can gain entry into the aforesaid VIP membership and how the cash conversion from points works. But first thing first, we’ll elucidate following ways for you to earn the points.

Subscribers Referral

With each new subscriber that you referred to IBI, you’ll receive 100 points. All you have to do is to reach out to your friends and family to subscribe to IBI. A good way is to advertise about us via your Facebook or other social media. Just make that you inform the new subscriber to let us know that you’re the person who made the referral. You can use your real name or pseudonym as you wish.

Loyalty Partners

By staying with us for at least three months, you’ll earn 100 points. For every 3 additional months, another 50 points will be added.

Market Intelligence

In addition, points will be rewarded to partners who are active in the chat forum (and to provide stellar stock tips as well as being helpful to the community). Of note, subscribers who tipped us with stock ideas that proved to work out over time will also rack up more points. Despite that the rewarding of this aspect can be subjective, we’ll try our best to make sure that it is fair to all partners. Accordingly, each reward in this category comes in as 100 points.

Business Development

Subscribers who provided us with insightful advice on business development as well as connecting us to various resources will also receive 100 points for each occasion. For instance, we’ll reward a partner with the pseudonym “8iron,” with 100 points, who helped us with the design of the IBI Long-Term portfolio. Moreover, those who wrote us a positive review (to enable investors to learn more about our service) will be rewarded with 100 points.

Partner of The Month

A subscriber who earned the most points for the month will be featured in our “Partner of The Month.” In this case, we’ll give you an additional 1,000 points on top of what you’ve earned.

Points Conversion

With the points accumulation over time, you can cash out monthly. If you choose to cash out, we simply need to have your PayPal for us to send you money within a day of your request. We can also send money via MoneyGram, but we prefer PayPal. In terms of conversion, every 100 points are worth $10. For 20K points accumulated, you can cash out your $2K or trade it for the entry into the aforesaid VIP Program.
VIP Partners have the best service, hands down. As a VIP, you can consult with Dr. Tran as much as you like. You’ll have his cell phone as well as Skype. And, he will feature your favorite stocks in the Integrated BioSci research, which often helps to unlock its value of your holding substantially. Nevertheless, the stocks have to meet certain criteria. You’ll also get periodic exclusive intelligence not available to regular members. Furthermore, you’ll gain the first invitation to join IBI’s management team.

Transparency And Tracking

We’ll keep a Google Spreadsheet that is viewable with a password. All you have to do is to provide us your email (and we’ll send you an email invitation for access. Notably, you can check your progress in real-time (as well as to chat with us and let us know what else we can do to better serve you).

Final Remarks

We’re testing this new PR Program to assess its efficacy in delivering increasing value for our partners. Of note, we’ll honor the points with the cash as stated. Be that as it may, we wish to disclaim that the points do not have cash value and are subject to change anytime on our behalf without due notice. Last but not least, we’ll update this program based on your feedback. Let us know what you think. As you are our business partners, your voice is important to us.
Author’s Notes: We’re honored that you took the time out of your busy day to read our market intelligence. Founded by Dr. Hung Tran, MD, MS, CNPR, (in collaborations with Dr. Tran BioSci analyst, Ngoc Vu, and other PhDs), Integrated BioSci Investing (“IBI”) marketplace research is delivering stellar returns since inceptions. To name a few, Nektar Therapeutics (NASDAQ:NKTR) procured more than 359% profits; Spectrum Pharmaceuticals (NASDAQ:SPPI) delivered over 167% gains; Kite Pharma netted 82%; Atara Biotherapeutics (NASDAQ:ATRA) appreciated +211%. Crispr Therapeutics (NASDAQ:CRSP) garned plus 110%. Exelixis Inc (NASDAQ:EXEL) earned greater than 51% capital appreciation. Our secret sauce is extreme due diligence coupled with expert data analysis. The service features a once-weekly exclusive in-depth Integrated BioSci Alpha-Intelligence article (in the form of research, reports, or interviews), daily individual stocks consulting, and model portfolios.
Notably, we’ll increase our price soon. SUBSCRIBE to our marketplace research now to lock in the legacy price and save money in the future.To receive real-time alerts on our articles as well as blogs, be sure to check out our profile page and CLICK the orange FOLLOW button . Asides the exclusivities, this article is the truncated version of the research we published in advance to IBI subscribers. Further, you can read up on Dr. Tran’s background by following this link. If you'd like to get our other once weekly ideas sent to your mailbox, check out Dr. Tran BioSci and sign up with our mailing list.

Thursday, February 8, 2018

An Integrated BioSci Alpha Intelligence On Gilead Sciences: What the Fiscal 2017 Earning Foretells?

Summary

Gilead reported favorable Q4 earnings that beat the market’s average estimate. HCV revenue is still in a downtrend.
As Sovaldi’s entry into China to take root, sales should be improved.
Progress is being made in the NASH segment.
CAR-T is progressing robustly as we anticipated.
To push for robust growth in the coming years, the company is in discussions to potentially acquire a gene-editing company.
However, to all this should be added something of equal importance if an investment is to prove a genuine bonanza. The largest profits in the investment field go to those who are capable of correctly zigging when the financial community is zagging. The Father of Growth Investing (Philip Fisher)
On Feb. 7, 2018, Gilead Sciences (NASDAQ:GILD) - a giant bioscience at the forefront of the innovation and commercialization of therapeutics to service various niche markets - traded $2.38 (+2.9%) higher at $82.76 (due to the positive earnings). Since we recommended the firm to subscribers of Integrated BioSci Investing (on Nov. 10, 2017), the stock has appreciated more than 12%. The capital gain is mostly due to the following powerful catalysts powering the company: Chimeric Antigen Receptor and T-Cell Receptor (“CAR-T”) platform, Hepatitis C franchise expansion into the vast China market, as well as nonalcoholicsteatohepatitis (“NASH”).
Figure 1: Gilead stock chart. (Source: StockCharts).
At Integrated BioSci Investing (“IBI”), we have much success in finding robust performers. For instance, Nektar Therapeutics (NASDAQ:NKTR) appreciated over 306% for subscribers. Exelixis Inc procured over 55% profits. In this research, we’ll explicate the ramifications of the Q4 earnings for Gilead (and what investors can expect from this stellar growth company).

Fundamentals Analysis

The Foster City, CA, based-firm (Gilead Sciences) is at the forefront of the innovation and commercialization of highly advanced medicines to treat various conditions - HIV/AIDS, cancer, as well as heart, liver and respiratory diseases (as shown in figure 2). As alluded, the company is powered by stellar catalysts (i.e. CAR-T, NASH, and infectious diseases). Despite the temporary downturn in earnings in the recent years, it’s not far from the truth that the firm is gearing up for its next robust growth cycle.
Figure 2: Therapeutic pipeline. (Source: Dr. Tran BioSci).

Earning Highlights

Per figure 3, Gilead reported $5.9B revenues for Q4, 2017,  compared to $7.3B for the same period (a year prior). The net loss for the quarter came in at $3.9B ($2.96 per share loss) versus $3.1B ($2.34 per share) net income. Interestingly, the $1.78 non-GAAP diluted earning per share (“EPS”) beat the market consensus of $1.70 but is still lower than the $2.70 of last year. Of note, the decline is due to the $5.5B charge related to the tax reform. For fiscal 2017, the company procured $26.1B in sales (and $4.6B or $3.51 per share in net income) - a sizeable decline from the $30.4B revenues ($13.5B or $9.94 per share) from the previous year.
Figure 3: 2017 earnings. (Source: Gilead Sciences).

Infectious Disease

The aggregate revenues for the infectious disease segment (HIV/HBV/HCV) came in at $5.2B for Q4 compared to $6.6B for last year. Of this figure, the HIV/HBV franchises procured $3.7B compared to $3.4B for the similar period. The higher revenues for these two franchises are due to the increased uptake of the tenofovir alafenamide-based medicines. Despite favorable sales for HIV/HBV, HCV continues to post declining sales. Notably, this is due to the intense competition in the HCV market from Abbvie (NYSE:ABBV) and others. In light of the said environment, the company is tapping into the vast China market (and recently got Sovaldi to be approved by the China FDA). With the powerful China market as one of the key growth catalysts, we expect that the HCV sales to pick up in 2018 (while both the HIV/HBV continue to improve).

NASH

While the earnings beat the market estimate, the best is yet to come for Gilead. We noted that Gilead is brewing highly powerful growth catalysts to fuel its next growth cycle: one of those is the NASH franchise. Accordingly, the market for NASH (estimated by Global Data across 7-major markets - the USA, Germany, Italy, Spain, UK, and Japan - to grow at 45% CAGR from $618M in 2016 to $25.3B by 2026. Per table 1, there are several firms racing to secure a NASH molecule.

Final Remarks

Of note, this is the preview of the Integrated BioSci Alpha Intelligence research, published in advance to subscribers of Integrated BioSci Investing (a community of expert physicians, scientists, executives, market leaders, and everyday investors). In the aforesaid article, we took the deep-dive into the data analysis (and elucidate the potential upsides) that you can expect from this firm. If you're an investor (or thinking about investing in Gilead Sciences), it's a good idea to check out the pending catalysts of this firm.
Author’s Notes: We’re honored that you took the time out of your busy day to read our market intelligence. Founded by Dr. Hung Tran, MD, MS, CNPR, (in collaborations with Dr. Tran BioSci analyst, Ngoc Vu, and other PhDs), Integrated BioSci Investing (“IBI”) marketplace research is delivering stellar returns since inceptions. To name a few, Nektar Therapeutics (NASDAQ:NKTR) procured more than 306% profits; Spectrum Pharmaceuticals (NASDAQ:SPPI) delivered over 169% gains; Kite Pharma netted 82%; Atara Biotherapeutics (NASDAQ:ATRA) appreciated +166%. Crispr Therapeutics (NASDAQ:CRSP) garned plus 113%.  Exelixis Inc (NASDAQ:EXEL) earned greater than 63% capital appreciation. Our secret sauce is extreme due diligence coupled with expert data analysis. The service features a once-weekly exclusive in-depth Integrated BioSci Alpha-Intelligence article (in the form of research, reports, or interviews), daily individual stocks consulting, and model portfolios.
Notably, we’ll increase our price soon. SUBSCRIBE to our marketplace research now to lock in the legacy price and save money in the future.To receive real-time alerts on our articles as well as blogs, be sure to check out our profile page and CLICK the orange FOLLOW button . Asides the exclusivities, this article is the truncated version of the research we published in advance to IBI subscribers. Further, you can read up on Dr. Tran’s background by following this link. If you'd like to get our other once weekly ideas sent to your mailbox, check out Dr. Tran BioSci and sign up with our mailing list.