Best of the Week
Most Popular
1.What Happened to the Stock Market Crash Experts Were Predicting - Sol_Palha
2.London Housing Market Property Bubble Vulnerable To Crash - GoldCore
3.The Plan to Control ALL Your Money is Now at Advanced Stage
4.Why Gold Is Set For An Epic Rally This Spring - James Burgess
5.MR ROBOT NHS Cyber Attack Hack - Why Israel, NSA, CIA and GCHQ are Culpable - Nadeem_Walayat
6.Emmanuel Macron and Banking Elite Win French Presidential Election 2017 - Nadeem_Walayat
7.Trend Lines Met, Technical's are Set - US Dollar is Ready to Rally (Elliott Wave Analysis) - Enda_Glynn
8.The Student Debt Servitude Sham - Gordon_T_Long
9.Czar Trump Fires Comey, Terminates Deep State FBI, CIA Director Next? - Nadeem_Walayat
10.UK Local Elections 2017 - Labour Blood Bath, UKIP Death, Tory June 8th Landslide - Nadeem_Walayat
Last 7 days
SPX/NDX/NAZ Hit New All-time Highs - 27th May 17
GBPUSD Top in Place, GOLD Price Ready to Rocket? - 27th May 17
Silver Mining Stocks Fundamentals - 27th May 17
BBC Newsnight Falls for FAKE POLLS, Opinion Pollsters Illusion for Mainstream Media to Sell - 27th May 17
UK Local Election Results Forecast for General Election 2017 - 26th May 17
Stock Market & Crude Oil Forecast! - 26th May 17
Opinion Pollsters UK General Election Seats Forecasts 2017 - 26th May 17
Bitcoin and AltCoins Crypto Price Correction - 26th May 17
Bearish Head and Shoulders in EURUSD? - 26th May 17
SELL US Stocks - Massive Market CRASH WARNING! - 26th May 17
EURGBP: A Picture of Elliott Wave Precision - 26th May 17
Credit Downgrades May Prompt Stock Market Capital Shift - 26th May 17
Rosenstein and Mueller: the Regime Change Tag-Team - 25th May 17
Stock Market Top - Are We There Yet? - 25th May 17
Should I Invest My Fortune in Gold? Inaugural Lecture by Dr Brian Lucey - 25th May 17
USD/CAD Continues Decline - 25th May 17
Bitcoin Price Goes Loco! Surges through $2,500 Despite Unclear Fork Issues - 25th May 17
The US-Saudi Arms Deal - Sordid Saudi Signals - 25th May 17
The No.1 Commodity Play In The World Today - 24th May 17
Marks and Spencer Profits Collapse, Latest Retailer Hit by Brexit Inflation Tsunami 2017 - 24th May 17
Why Online Trading Platforms Are Useful for Everyone - 24th May 17
The Stock Market Will Tank Hard - 24th May 17
It’s Better to Buy Gold & Silver When It DOESN’T Feel Good - 24th May 17
Global Warming - Saving Us From Us - 24th May 17
Stock Market Forecast for Next 3 Months - Video - 23rd May 17
Shale Oil & Gas Production Costs Spiral Higher As Monstrous Decline Rates Eat Into Cash Flows - 23rd May 17
The Only Metal Trump Wants More Than Gold - 23rd May 17
America's Southern Heritage is a Threat to the Deep State - 23rd May 17
Manchester Bombing - ISIS Islamic Terrorist Attack Attempt to Influence BrExit Election - 23rd May 17
What an America First Trade Policy Could Mean for the US Dollar - 22nd May 17
Gold and Sillver Markets - Silver Price Sharp Selloff - 22nd May - 22nd May 17
Stock Market Volatile C-Wave - 22nd May 17
Stock Market Trend Forecast and Fear Trading - 22nd May 17
US Dollar Cycle : Deep Dive - 21st May 17
Bitcoin Breaks the $2,000 Mark as Cryptocurrencies Continue to Explode Higher - 21st May 17
Stocks, Commodities and Gold Multi-Market Status - 21st May 17
Stock Market Day Trading Strategies and Brief 20th May 2017 - 21st May 17
DOW Needs to Rally Big or Correction is Next - 20th May 17
EURUSD reaches DO or DIE moment! - 20th May 17
How to Get FREE Walkers Crisps Multi-packs! £5 to £28k Pay Packet Promo - 20th May 17

Market Oracle FREE Newsletter

Why 95% of Traders Fail

The Smart Money Is Piling Into Regenerative Medicine

Companies / BioTech Apr 18, 2017 - 06:12 PM GMT

By: John_Mauldin

Companies

BY PATRICK COX : The Congressional Budget Office released its long-term budget outlook. This report should have sparked a national discussion about societal aging, but big media largely ignored it.

Fortunately, there are signs that smart investors are hedging this failure by investing in regenerative medicine (RM).


Over the last few years, the CBO has emerged as one of the few grownups in the room. Its annual budget projections have focused on population aging as the main driver of US federal deficit and the debt.

The core message of "The 2017 Long-Term Budget Outlook" is simple: Mandated transfer payments for our increasingly older demographic are just too much.

These costs have crippled the federal government and the private sector. The CBO warns that this is causing economic instability. As a result, a cascade of financial crises is more and more likely.

Only three parts of the budget are growing in relation to the whole. They are Social Security, health care, and net interest.

Social Security is clearly about the aged, so are increased healthcare costs. The CBO says those costs will continue to rise.

The reason? We are living longer and new treatments for age-related diseases continue to emerge. But even if dramatic cuts are made to benefits for the aged, it will only slow the meltdown.

Why? Long-term demographic trends will continue. Life expectancies will keep rising as birthrates fall.

Progressive Approval Could Be a Game Changer for RM

Japan is ahead of the curve in terms of demographics, but the US will soon get there. It is important to note that Japan has failed to produce political solutions to its budgetary woes.

But Japan has started to look at this problem through a different lens. These economic issues can be solved by addressing aging itself.

Japanese lawmakers have instituted progressive approval for regenerative medicine (RM). That means after successful safety trials, RM therapies can be approved. Data will then be collected and made public.

Critics of progressive approval claim it could legalize ineffective treatments. The Japanese think that the risk of delaying true anti-aging therapies is greater than the risk of approving ineffective treatments.

Japanese leadership seems to have had a major impact on the investment community. Now, US firms are eyeing the prospect of gaining much faster approvals in Japan.

This has major financial implications for RM biotechs.

Investing in Regenerative Medicine

A recent report from Goldman Sachs includes a section titled “The Coming Age of Regenerative Medicine.”

Business Insider article about the report is aptly titled “Money is pouring in to a hot new area of science that could change the way we think about aging.

According to the article, “venture capital in companies pursuing regenerative medicine increased from $296 million in 2011 to $807 million in 2016, growing roughly 34% year-over-year.”

The author also writes that, “by the report's count, 80 regenerative-medicine companies received funding in the last three years, and the deals related to regenerative medicine accounted for almost half of the top venture-capital deals in 2015 and 2016.”

Two years ago, Fed Chair Janet Yellen threw cold water on biotech. She compared it to overheated social media.

I think Yellen was wrong. And her off-the-cuff comment hurt startups struggling to find funds in order to survive.

On the other hand, economist John Mauldin has long predicted that there will be a bubble following the public’s realization of the power of emerging RM.

But bubbles aren’t uniform things. History teaches us that under- and overvalued companies exist at almost all times.

Some of the companies covered in the Goldman report seem overvalued to me. Analysts, though, are frequently wrong.

We never know what a company is truly worth until its products are judged by consumers.

The Goldman report discusses Samumed, a private RM company. With $300 million in funding, it’s valued at a staggering $12 billion. Samumed’s drug platform aims to regenerate various tissues such as bone, cartilage, hair, and skin.

As Samumed is not yet public, my interest in the company is academic. The larger question is what it means to more established RM companies.

AgeX Plans to Reverse Aging

The original RM company, Geron, is now folded into BioTime subsidiary Asterias. BioTime (*see disclosure below) is the core of my RM portfolio. This is largely because of Michael West, who pioneered the SCI therapy at Geron over 20 years ago.

To date, West's stem cell treatment for spinal cord injury is the most successful example of RM, but it’s 20 years old. Since that time, West’s research has progressed much further.

Last week, BioTime announced a new subsidiary, AgeX. AgeX has a range of stem cell IPs aimed at conditions such as cardiovascular repair and diabetes.

The true goals of AgeX, though, are much more radical. West intends to reverse aging … hence the company name.

He believes he can reactivate embryonic gene pathways to completely regenerate limbs and organs, including eyes, joints, and hearts. AgeX’s induced tissue regeneration technology would not only regenerate damaged and missing tissues.

It would turn back the biological clock of aging. West gave an excellent talk on this new science in his keynote address at the 2016 World Stem Cell Summit.

If he’s right, we’ll still have lots of problems, but the cost of age-related diseases won’t be one of them.

Stay in the Loop on Life-Extending Research with Patrick Cox's Tech Digest

This weekly newsletter by biotech expert Patrick Cox highlights research that is much more advanced than most people know, and the profit potential for investors is vast. Read about the latest breakthroughs—from new, non-invasive cancer treatments to age-reversing nutraceuticals and vaccines that kill any virus–as well as the innovative companies that work on them. Get Tech Digest free in your inbox every Monday.

(*Disclosure: The editors or principals of Mauldin Economics have a position in this security. They have no plans to sell their position at this time. There is an ethics policy in place that specifies subscribers must receive advance notice should the editors or principals intend to sell.)

John Mauldin Archive

© 2005-2016 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Catching a Falling Financial Knife