An Integrated BioSci Alpha Intelligence On CytomX Therapeutics: A Prodrug Innovator With Substantial Unlocked Value

Summary

• Probody platform is a novel and powerful approach to delivering anticancer drugs to specific tumor environment (that enhances efficacy while reducing toxicity).
• Many cancer targets like CD71 (are susceptible to antibodies) but are also expressed in healthy tissues; hence, the conventional antibody drugs can be toxic to both cancer and healthy tissues.
• Probody leverages on the tumor environment to activate the conjugate antibody to be released exactly at the disease sites.
• Application of Probody is vast (as there are many cancer markers showing in both healthy and cancerous cells).
• Major pharmaceuticals already signed the development and commercialization partnership with CytomX to utilize Probody for various therapeutic development franchises.

“Don’t assume that the high price at which a stock may be selling in relation to earnings in necessarily an indication that further growth in those earnings has largely already discounted in the price.” - The Father of Growth Investing (Philip Fisher)

In the past 52-week, the shares of CytomX Therapeutics (NASDAQ:CTMX) - a firm focusing on the development and commercialization of novel cancer immunotherapeutics - traded $13.73 higher at $25.73 (for +114% profits). Similar to the stellar bioscience run-up such as Atara Biotherapeutics (NASDAQ:ATRA) that appreciated over 166% for subscribers of Integrated BioSci Investing (“IBI”), CytomX is brewing highly promising growth catalysts. In this report, we’ll elucidate the underlying science as well as fundamentals of the aforesaid firm.

Figure 1: CytomX stock chart. (Source: StockCharts)

About The Company

Prior to discussing the novel therapeutic platform (Probody), we wish to go over notable principles of cancer treatments. While there are various management modalities, a particularly prudent approach is to employ antibody treatment. Certain cancers express key molecular targets, in which the antibody specifically binds to (and either to neutralize the target alone or to deliver a toxic payload for its destruction). An example is a drug (trastuzumab), which is utilized for the treatment of HER2 receptor positive breast cancer. Another strategy that delivers even better efficacy and safety is the use of combinations therapy. In the traditional sense, a combination therapy entails the use of two or more drugs to neutralize different cancer targets. A unique and highly effective bent on combinations treatments is when a sole molecule - like cabozantinib of Exelixis (NASDAQ:EXEL) or poziotinib of Spectrum Pharmaceuticals (NASDAQ:SPPI) - can, in and of itself, simultaneously inhibit various marks. Of note, cabozantinib is already FDA-approved to treat three different cancers. And due to its stellar profiles, Exelixis is investigating its potential treatment in 20 different oncologic indications.

As mentioned, antibodies are overall safe and efficacious for treating cancers. Nonetheless, there are many cellular markers found on both diseased as well as healthy tissues (i.e. CD71). If we develop an antibody to those targets, it is most probable that healthy tissues are concurrently being affected, thereby rendering its therapeutic usability. This market is where Probody can tap into for the delivery of stellar treatment outcomes. Per figure 2, Probody uses an antibody and attaches it to a substrate linker (connected to a masking protein). The antibody itself can piggyback a payload designed to decimate the tumors. The ingenious aspect of this design is that the antibody itself is not activated in the normal physiology environment (hence, no destruction of normal tissues, thus limiting adverse effects such as hair loss, nausea, and vomiting). As Probody encounters the cancerous tissues, the diseased environment is usually acid: this induces the local proteases to cut the substrate linker; thereby, remove the masking protein from the antibody to deliver its therapeutic payload.

Figure 2: Probody therapeutic platform. (Source: CytomX)

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 CytomX), 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 310% profits; Spectrum Pharmaceuticals (NASDAQ:SPPI) delivered over 190% gains; Kite Pharma netted 82%. Atara Biotherapeutics (NASDAQ:ATRA) earned greater than 166% 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.

An Integrated BioSci Alpha-Intelligence On Ocular Therapeutix: All Eyes On The Investing And Acquisition Prospects Of A Stellar Innovator

Summary

• Recent acquisition Kite by Gilead (and the likely buyout of Juno by Celgene) foretell a highly favorable M&A environment for 2018.
• Innovating a highly enriched pipeline, Ocular’s trading reversal is powering a pending catalyst.
• Regeneron already partnered with Ocular for the development of the sustain-release version of its blockbuster drug (Eylea).
• With its existing partnership with Regeneron, Ocular is the prime M&A candidate by the aforesaid giant.
• The temporary share price recession of Ocular (coupled with its robust fundamentals) created an opportunistic entry point with significant upsides.

“Companies which have significant growth prospects for the next few years because of new demand for existing lines, but which have neither policies nor plans to provide for further developments beyond this may provide a vehicle for a nice one-time profit. They are not apt to provide the surest route to financial success. It is at this point that scientific research and development engineering begin to enter the picture. It is largely through these means that companies improve old products and develop new ones. This is the usual route by which a management not content with one isolated spurt of growth sees that growth occurs in a series of more or less continuous spurts.” - The Father of Growth Investing (Philip Fisher).

In the past 52-week, the shares of Ocular Therapeutix (NASDAQ:OCUL) traded $1.86 lower at $6.23 (for the potential loss of 22%). The share price recession was due to the complete response letter (“CRL”) that the Bedford, MA-based firm received from the FDA re the late-stage molecule dexamethasone insert 0.4mg (Dextenza) - a potential medicine to manage ocular pain, following eyes surgery. In the middle of this difficulty is the opportunity to invest in a bioscience with highly promising prospects as well as being a potential acquisition candidate by Regeneron Pharmaceuticals (NASDAQ:REGN).

Figure 1: Ocular Therapeutix stock chart. (Source: StockCharts).

Aside from our 2017 best performer, Nektar Therapeutics (NASDAQ:NKTR) that delivered over 280% for subscribers of Integrated BioSci Investing (“IBI”), we also published a few M&A candidates over the years. Our superb CAR-T innovator, Kite Pharma (NASDAQ:KITE) was consummated by Gilead Sciences (NASDAQ:GILD) while another CAR-T developer in the IBI Long-Term portfolio is in the discussions to be acquired by Celgene Corporation (NASDAQ:CELG). In this report, we’ll elucidate the investing thesis on Ocular while touching upon its aforesaid buyout prospects.

Fundamentals Analysis

The ophthalmology-focused bioscience, Ocular Therapeutix has one approved product, ReSure. As the first of its kind for sealing the clear corneal incision following cataract surgery, ReSure is prepared and applied promptly after surgery to protect the incision (in the immediate postoperative period) when the wound is most vulnerable. Notably, there is no need for ReSure removal (because the hydrogel gradually sloughs off in the tears during the healing process coined reepithelialization).

Similar to ReSure, other molecules in the pipeline utilize the hydrogel technology that is biodegradable while allowing for the extended delivery of various drugs (as shown in figure 2). Accordingly, there are three late-stage therapeutics, including two dexamethasone insert (Dextenza and OTX-DP), and travoprost insert (OTX-TP) indicated as the potential treatments of post-surgical pain and management, allergic conjunctivitis, and ocular hypertension relating to glaucoma, respectively.

Figure 2: Therapeutic pipeline. (Source: Ocular Therapeutix).

You can access the in-depth Integrated BioSci Alpha-Intelligence through our Integrated BioSci Investing marketplace.

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 280% profits; Spectrum Pharmaceuticals (NASDAQ:SPPI) delivered over 150% gains; Kite Pharma netted 82%. Exelixis Inc (NASDAQ:EXEL) earned greater than 50% 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.

How To Best Allocate Your Capital In The IBI Long-Term Portfolio?

Summary

• IBI Long-Term portfolio is compounding over 27% as of Jan. 12, 2018. New portfolio additions are continuing to deliver substantial profits.
• Despite that the best strategy is to mirror IBI long-term portfolio, there are alternative approaches to capture the lucrative profits in bioscience.
• This is an abbreviated version of the in-depth Integrated BioSci Alpha-Intelligence research available in advance to our marketplace subscribers.

“Successful investing takes time, discipline and patience. No matter how great the talent or effort, some things just take time: You can't produce a baby in one month by getting nine women pregnant.” - The Oracle of Omaha (Warren Buffett)

Since Integrated BioSci Investing (“IBI”) commenced operations back on June 27, 2017, we’ve compounded the 27% composite gains for the IBI Long-Term portfolio for the trailing 6-month. Our robust growth is mostly due to the notable performers as depicted in table 1. Accordingly, our picks in Kite Pharma (NASDAQ:KITE), Nektar Therapeutics (NASDAQ:NKTR), Spectrum Pharmaceuticals (NASDAQ:SPPI), Atara Biotherapeutics (NASDAQ:ATRA), Amicus Therapeutics (NASDAQ:FOLD), Exelixis Inc (NASDAQ:EXEL), and Crispr Therapeutics (NASDAQ:CRSP) procured 82%, 282%, 153%, 100%, 62%, 59%, and 45%, respectively.

Figure 1: Notable IBI performers. (Source: Google Finance).

Without further introduction, we’ll share with you the exchange between Dr. Tran BioSci of Integrated BioSci Investing with Len Nguyen ("LN") (that can shed further insight into how to best use the IBI Long-Term Portfolio).

LN: What do you recommend as the percentage of a particular stock in the IBI portfolio that one should allocate?

Dr. Tran: I suggest that investors allocate an equal percentage to all bioscience in the IBI Long-Term portfolio. Notwithstanding, for certain equities that have compelling reasons with nearly 100% certainty that they can trump other issues, I'd double up the stakes (but no more than that). Notably, there are always the random chances that no matter how strong a thesis is, it will not be played out as one anticipated; hence, it’s best to exercise adequate diversification to minimize the risks while maximizing one’s chances of finding the multi-bagger rewards.

LN: Will you notify of sell recommendation when a particular stock in the portfolio is no longer attractive?

Dr. Tran: I will most definitely issue the sell recommendation when any stock (in the IBI Long-Term portfolio) post fundamentals decline (and the chances of rebounding are slim). This way, I can add further value to subscribers.

LN: Re the maximum percentage one should invest in bioscience versus one’s total stock portfolio (i.e. if your total stock portfolio is 100K), how much of this amount would you allocate to biotech investing?

Dr. Tran: There are different strategies to portfolio allocation. The one I'm utilizing takes into consideration of an oncoming recession as well as new opportunities. A recession will surely come in the future; however, Buffett said that one can reliably forecast the exact timing. When it comes, I strongly recommend investors not to sell your shares of IBI holdings: stellar firms with robust fundamentals will rebound to their new highs when the market stabilizes (as great investors like Buffett, Fisher, Lynch, and Mohnish Pabrai advised). I, myself, witnessed that phenomenon during the 2008 recession. Moreover, Pabrai said that during the recession, you can close your eyes, throw a dart, and it'd hit. Most companies that you invest during the recession will increase multiple folds in the subsequent years.

Recession asides, there are great bioscience opportunities that IBI seeks to uncover over time. As the results, I'd leave ample cash in anticipation for both new opportunities as well as an oncoming recession. In applying the aforesaid approach to the 100K portfolio, a good strategy is to allocate $60K into IBI while keeping $40K in cash (to deploy during a recession or whenever opportunities emerge). Furthermore, it’s best to specialize in one niche (i.e. bioscience), where there is high growth (to reward you with market outperformance in the long-term). To every rule, there is at least one exception. And, I’ll keep my eyes on special situations in other industry and alert subscribers accordingly.

Final Remarks

In all, we recommend that investors mirror the IBI Long-Term portfolio. That way, you can ensure that your portfolio has the most number of companies to be strongly diversified. Of note, it is highly difficult to earn over 50% compounded annual gain for a well-diversified portfolio in the long-term. Notwithstanding, one can expect to beat the market with the good rate over the long-haul that will substantially grow your capital. As depicted in figure 2, we calculated the 10-year investment horizon for the IBI Long-Term portfolio - assuming the 27% annual compound gains on $100K of initial capital that is fully invested - and found that IBI should turn your money into about $1M. Last but not least, this is an abbreviated sample of the in-depth Integrated BioSci Alpha Intelligence research, published in advanced and to subscribers of Integrated BioSci Investing (a community of expert physicians, scientists, executives, market leaders, and everyday investors).

Figure 2: A compound interest case study. (Source: TheCalculatorSite)

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 210% profits; Spectrum Pharmaceuticals (NASDAQ:SPPI) delivered over 180% gains; Kite Pharma netted 82%. Exelixis Inc (NASDAQ:EXEL) earned greater than 50% 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.