Our correspondents stuck it out to the end at the JPMorgan HealthCare Conference. Here are the reports they filed about the final day of presentations.
The best presentation I saw today was deCode Genetics Inc. (DCGN). They have a number of diagnostic tests coming on line and a set of compounds for the prevention of major disease (heart attack, stroke, arterial disease). These compounds were discovered using their genetic testing. They found genes associated with certain pathologies and then found the pathways these genes were in, and noticed that these genes were over-expressed and that the pathways were over-active. They then developed compounds to block those pathways.
It sounds very plausible, and it may work. If it does, it is probably the first real drug development based on genomics. They claim to have a compound that has properties similar to aspirin and Plavix but does not cause bleeding.
I also saw Lexicon (OTCPK:LEXG) but was not impressed. The pipeline is very early. Lexicon also tried to justify its drug discovery based on its platform of knockout mice, but that was not really clear. Apparently, their drugs also have a novel mechanism of action, something everyone always wants but something that is actually problematic as the FDA is usually very reluctant to approve drugs with new MOA (see Sanofi's (NYSE:SNY) drug Rimonabant/Acomplia for obesity).
The presentations from other companies did not strike me as particularly interesting or exciting. As is usual the last day, attendance was pretty poor and some companies in the Grand Ballroom had more presenters than audience members. One good example was Hanger Orthopedic (HGR).
Overall, the meeting was well attended, and there was enthusiasm and great interest for some companies, but most of that interest went to established players with revenues. That is quite different from what JPMorgan (and especially H&Q) used to be like, when private businesses dominated the picture and attendance was driven by expectations (and some would say hype). But the small private companies added a certain dynamism and excitement that is now missing, in my opinion.
In yesterday's lunchtime presentation, the audience was asked to participate and was polled with some questions. It quickly became apparent that most investors are quite bullish (even when the experts are not, as for example happens in the Generics sector, which many believe will suffer from the $4 drugs at WalMart (NYSE:WMT) and other places). Investors do like big biotech and big pharma.
It also appears that most are quite happy to follow the herd. The answer to one question revealed that most would do whatever their JPMorgan person recommended. JPMorgan representatives may have thought that was great, but it shows a lack of independent thinking, and an aversion to anything that is novel and different.
Whew! I made it to the final day – what a relief! My mind is swirling with biotech investment fodder. The last two presentations I saw – Artes (ARTE) and NuVasive (NASDAQ:NUVA) – were both from San Diego, which was appropriate as I was about to jump on a plane to my home there. Artes was impressive. A recent IPO with approved products, and they only need 100,000 patients, out of a population of 1.6 million, to reach $100 million in revenue. Just jumped over 4% on positive Q3 report. (See our earlier report on Artes.)
Nuvasive – very impressive. Spine again. Strong franchise and leadership. Earnings call coming up on 2/20.
And outside of the conference, I met with Dr. Avtar Dhillon, the CEO of Inovio (NYSEMKT:INO). Very exciting technology applicable to surface tumors, gene therapy, and DNA vaccines. They have been running in stealth mode, but have about 10 major partnerships, including the latest worth $65 million with Wyeth (WYE). They should have announcements on 8-10 of their programs in the next 6 to 9 months. This is a “one-to-watch” with big break-out potential.