Personalized medicine will treat investors well
The nanotech drug sector looks particularly promising.
The personalized medicine market is in the midst of explosive growth. From personalized diagnostics to specifically tailored treatments, there are opportunities for investors to gain exposure.
The latest report on medical trends costs from PriceWaterhouseCoopers pegged the overall medical cost growth rate at 7.5% for 2013. Similar studies (including a 2009 report from PWC) indicate that the personalized medicine or PM growth rate will be, at worst, in the low-double digits. But it is a recent report by Infiniti Research that should entice even the most risk-averse investor. This report expects the nanotech drug market will grow at a compounded annualized growth rate of 74% through 2016.
It is no wonder, therefore, that major medical suppliers like Thermo Fisher Scientific (TMO) are adding to their portfolio of analytic equipment to support this niche, especially protein biomarkers.
Thermo just signed two small deals in this area. One is with Proteome Sciences (PMSNF) to create a new wrinkle on Tandem Mass Tag mass spectrometry to improve profiling of cancer pathways and aid in drug selection. The other is with Perfinity Biosciences (PurdueResearchPark.com), which will automate protein sample preparation and analysis. This deal should fold back into the deal with Proteome to accelerate biomarker development.
Thermo Fisher is shoring up the production and analysis of changes in the protein pathways of tumors, which should have significant impact on the development and data accuracy of targeted immunotherapies like those being developed by ImmunoCellular Therapeutics (IMUC) and OncoSec Medical (ONCS). Both have novel Stage II or later clinical trials in progress for their flagship products, vaccine-based direct application immunotherapies.
IMUC announced interim results recently on its current Stage II trial for its patented ICT-107 glioblastoma vaccine with the recommendation from the Data Monitoring Committee to see the trial through to its completion, which should occur by the end of the year. The stock popped on the news but has since settled back near its IPO price of $2.25 per share, indicating some profit-taking by initial investors. Thanks to the IPO, the company has at least two years' worth of working capital to take ICT-107 through to a now more likely Phase-III follow up trial.
ONCS recently updated its Stage II trial on its ImmunoPulse therapy for treating patients with Stage III or later metastatic melanoma. The trial is now fully enrolled and set to complete by early 2014. ImmunoPulse is both a vaccine and novel delivery system in which a very targeted amount of DNA IL-12 cytokine which boosts the local production of cytotoxic T-cells to aggressively fight the cancer cells.
Together they make up the OncoSec Medical System in which electroporation creates temporary pores in the cell walls to deliver what are highly toxic chemotherapies in such a way as to maximize their efficacy while minimizing their damage. Moreover, these are treatments for skin cancers -- metastatic melanoma, Merkel cell, and cutaneous t-cell lymphomas -- with high mortality rates because of a lack of acceptable delivery system. It announced a recent Sponsored Research Agreement with Old Dominion University to do nonclinical research on both ImmunoPulse and NeoPulse with three new therapies for treating melanoma.
ONCS is a small cap whose stock looks to have long-term support at $0.20 per share is showing signs of accumulation with a move above $0.25 per share on its weekly chart. A full interim report on the current Stage II trial involving IL-12 is expected in the coming weeks and could have a big effect on the price for those willing to take a bit of a risk. [Editor's note: ONCS is a micro-cap stock whose shares trade below $1, at 26 cents. As such, the stock is highly risky.]
The personalized medicine industry is going to be home to a number of these new technologies and will drive all new analytic techniques and solutions to current problems. With the amount of expected growth investors will do well to go where investment is the strongest. The NASDAQ Biotech Index ($NBI) has been a stellar outperformer during this equity rally, outpacing the S&P 500 (SPY) 2:1 year-to-date.
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These hot movers could rise by double digits in coming months.
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