biologics based medicine is gaining momentum as these drugs offer targeted
therapy and often safer treatment options, higher returns on investment and
slower erosion of market share post patent expiry compared to small molecule
based drugs. First Generation Monoclonal antibody based drugs are the
cornerstone of treatment of major diseases (RA, MS, cancers, AMD, etc). As the
patents for these 1st generation Mabs are set to expire from 2014 onwards we
focus on companies with novel technology platforms developing 2nd Generation
mabs to deliver better biologics.
Second Generation Targeted Therapies using
Monoclonal Antibodies (mAbs) could offer drugs for, 1) novel targets and 2) old
validated targets with better efficacy/safety profile and/or improved versions
of existing blockbusters. This “Ever Greening Effort” has the potential to
deliver molecules with a higher therapeutic index enabling optimally effective
treatment to be achieved at a dose below the maximal tolerated dose minimizing
the adverse event profile of the drug.
Our analysis of two maturing platforms has
yielded several attractive RS investment opportunities which are discussed
throughout the report and highlighted in company-specific capsules.
• Second Generation Monoclonal Antibodies:
Ablynx (ABLX), Morphosys (MOR), Trubion (TRBN), and Micromet (MITI).
• Antibody Drug conjugation (ADC): Seattle
Genetics (SGEN), Immunomedics (IMMU).
We expect the innovative technology platforms
used to generate new mAbs to accelerate M&A and attract robust
collaborations as some of these companies are at their inflection point as
their products enter proof-of-concept (POC)/pivotal clinical trials.
Collectively, all the companies in this report offer a long-term investment
opportunity, as the technology platforms used for generating these products are
being validated by multiple partners. Positive data could trigger M&A at a
premium like Abgenix, CAT, or Medarex .