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Msg  35000 of 35004  at  9/26/2021 8:11:06 AM  by


Alnylam mentioned in Barron's

 Well, if the weekends rumors are true about XLRN, that was a good call. He likes Alnylam also.

Chris, take notes. Ziad, where do you see value today?

Bakri: I’ve got four companies, connected by a theme. All are platform companies. They are a bit bigger than Liisa’s companies, and we believe they are capable of becoming much bigger over time. The theme is investing in companies with A-plus management teams. Also, unintentionally, they all start with the letter A: Acceleron Pharma [XLRN], Ascendis Pharma [ASND], Alnylam Pharmaceuticals [ALNY], and Argenx [ARGX]. Acceleron has one drug approved, Reblozyl, to regulate TGF-B [transforming growth factor beta]. This is a complex, poorly understood area of biology implicated in many different diseases. Acceleron partnered on the drug with Bristol, and gets royalties of 20% or so on sales. Bristol has said this could be a $3 billion to $4 billion drug, longer term.

Acceleron’s second drug is sotatercept, a treatment for a life-threatening disease called pulmonary arterial hypertension, or PAH. This is a $5 billion to $7 billion market today. The drug seems to work on patients who aren’t doing well with other PAH drugs. I expect that the Phase 3 data will look good, and that this could become a multibillion-dollar drug. In the pipeline are other drugs to treat severe conditions whose biology is related. In 2016, Johnson & Johnson [JNJ] bought Actelion, a company specializing in PAH treatments, for $30 billion, to give you an idea of the value that can be generated in this space.

Next, Ascendis is developing a drug-delivery platform that modulates the rate at which drugs pass through the body. Its first focus is on hormones. It has one drug approved: a long-acting formulation of human growth hormone. It will be a decent-size drug, not a huge one, but that’s not why I love the company.

What else is in Ascendis’ pipeline?

Ascendis is developing a drug for hypoparathyroidism, a hormone-deficiency condition that has severe impacts on bone and cardiovascular health. This drug is best-in-class and could become a blockbuster. The third, an earlier-stage drug for dwarfism, has a good chance of working. This is a scarce platform company that can replicate its success with multiple drugs, and whose management team is capable of growing Ascendis into a much larger company over time.

Alnylam, my third pick, is pursuing a technology that’s kind of the opposite of Moderna’s. Messenger RNA sends instructions to cells to make certain proteins. Alnylam’s technology, RNA interference, or RNAi, turns off the production of certain proteins. Alnylam is probably the most innovative company in this space. It has launched three wholly owned drugs targeting rare diseases that are generating hundreds of millions of dollars in annual sales. Now, the company is going after more-common diseases and conditions, including high cholesterol, in partnership with Novartis [NVS], and high blood pressure. Soon, we may be able to deliver RNAi drugs for the masses. It could become a commonly used modality.

What is the case for Argenx?

Argenx, my last name, is building a platform based on FcRn inhibitors, a new class of drugs to treat autoimmune diseases. The company’s drug is efgartigimod. The category is a race between two players: Argenx and Momenta Pharmaceuticals, which was acquired last year by Johnson & Johnson for about $6.5 billion. Argenx has a market cap of $16 billion. Efgartigimod could become a multibillion-dollar drug, like AbbVie’s Humira, which treats rheumatoid arthritis.

Efgartigimod’s end-markets have been de-risked by IVIG, a product derived from blood donors that is meaningfully supply-constrained, yet still sells about $6 billion annually in many of the same autoimmune conditions. Argenx is in trials for six different disease indications, and its drug could potentially be used in more than a dozen diseases over time, potentially making it a megablockbuster. Argenx has a top-tier management team that is already scaling the company globally, in advance of efgartigimod’s first launch in Myasthenia Gravis next year.


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