• The top 10 best selling drugs in 2018 generated $90 billion in revenues for large pharma companies
• This comes at a time when many of the top drug makers are facing pressures about drug pricing

AbbVie’s (NYSE:ABBV) arthritis drug Humira remains the best selling drug in the world with over $20B in sales, more than double the second place Eliquis.

Combined, the top 10 best selling drugs in 2018 generated over $90B in revenues. Many of the drug developers, including Bristol-Myers Squibb (NYSE:BMY) and Merck (NYSE:MRK) are facing scrutiny for pricing drugs north of $100,000/year in the USA when in other countries the same drugs sell for a fraction of the costs.

Article by: Mick Ross
Mick is currently a full-time investor and formerly a buy-side analyst (2yrs) covering healthcare companies. Before that, he was a salesperson at a bulge-bracket firm, based in Dallas, Texas. Mick blogs to clarify and synthesize his investment thought process and to elicit feedback; additionally he likes to connect with other investors and swap ideas.

• Gene-editing technology CRISPR is being tested in disease settings where vaccines are currently not effective
• Although years away from market, early data shows promise

Vaccines work by jump-starting the immune system’s B-Cells to manufacture specific antigens, our body’s defense mechanisms against particular viruses.

Naturally, the body’s immune system will manufacture B-cells when there is a foreign virus that comes from a vaccine or natural infection. Once the body realizes the foreign virus, it produces the virus-matching antigen that can destroy the invader.

An issue arises when the foreign virus has DNA that the body cannot replicate or when the DNA is constantly changing. This is because the B-cells cannot manufacture the required antigen needed to fight the foreign virus. As a result, vaccines are limited or ineffective in people with compromised immune systems (old people), or when someone catches a viral disease that has no vaccine antigen. Examples here are viral diseases and the flu.

Scientists are now testing CRSIPR, a gene-editing technology, in the hopes of turning the immune system against viruses for which there are no vaccines. B-Cells are being engineered to program the defense mechanism to produce and keep producing whichever antibody is needed to fight the foreign virus.

In simple term, CRISPR is being used to nudge B-cells to produce the right antibody needed to fight the disease. The hope is that CRISPR could edit B cells that could produce immunity against diseases where traditional vaccinations fail. CRISPR may be able to manufacture a better equipped B-cell capable of fighting off diseases better than traditional vaccines.

However, there are hurdles that must be overcome. For starters, CRISPR will not replace traditional vaccines due to the high costs. CRISPR is used to modify patients’ B-cells individually (patient by patient). A “mass manufacturing” CRISPR approach would be rejected by our immune system. This makes vaccines, by comparison, are cheap. Secondly, the approach will have to be tested in human clinical trials for years before being commercial. The probability of failure in these clinical trials is high.

Three companies developing CRISPR and gene editing technologies are:

1. CRISPR Therapeutics (NASDAQ:CRISPR)
2. Sangamo (NASDAQ:SGMO)
3. Editas Medicine (NASDAQ:EDIT)

Article By: Fatimah Aminu
Fatimah is an experienced editor at various financial and consumer publishing houses. She obtained a master’s degree in Publishing from NYU, where she earned a bachelor of fine arts degree. She is currently earning a second masters degree at CUNY online in Psychology. Fatimah covers healthcare, cannabis and technology.

• The ING International Survey Savings 2019 surveyed 14,695 people in Europe, the US, and Australia, and discovered the majority worry about not having enough money in retirement.

Residents of economically stressed European nations are worrying as they near retirement. More than half of all people, in primarily developed nations, are worrying about their retirement savings. 69% of surveyed Spanish and 67% of French worry about their retirement fund. In the US, that number is 62%.

Approximately half of retirees are taking a hit in their standard of living once they reach their golden age. Again, French are at the top of the list with 69% of surveyed participants saying they do not enjoy the same standard of living in retirement as they had when they were working. In the US, this number is only 30%.

With governments all burdened in debt, it’s widely expected that budget cuts are in the near future. Low saving rates are becoming a norm amongst the middle class who are living paycheck to paycheck. Inequality is becoming a bigger issue. Retirement is not the forward looking event it once used to be.

Article by: Francisco Cortez – Delgado
I graduated from Queen’s University with a Master’s of Political Studies. The intertwined world of politics and economics intrigue me. My favourite stories to cover are the ones that show how a few selected officials can impact nationwide macro-economic policies. I also follow the broader markets and FOREX.

• Healthcare spending will rise by 5.5% annually over next decade as more people get on Medicare
• In order to cover these added costs, governments will be pressured to raise taxes and private insurers to raise premiums
• Investors of insurance and healthcare companies will benefit from increase in spending

Government health agency, Centers for Medicare & Medicaid Services (CMS), estimates that US health spending will reach $6T over the next decade. From 2018 – 2027, health spending is expected to increase annually by an average of 5.5% every year. This adds up to health spending that will be 70% higher in 2027 than it is today.

Rising income levels, better employment rate and more people enrolling for the federal health insurance program Medicare will cause healthcare spending to rise to 19.4 percent of the U.S. economy by 2027. In 2017, this figure accounted for 17.9% of the US GDP.

What does this all mean?

Well, approximately 47% of the health spending will be funded by government, compared to 45% in 2017. This additional money will have to be sourced from somewhere. The government will be left with two options to cover the higher spending: higher taxes or go into further debt. The likeliest scenario will be a combination of both.

The remaining 43% of health spending will be funded by private insurance companies. That is approximately an extra $1T in spending for insurers, who will likely raise premiums to cover the costs.

Who stands to benefit most?

Increases in healthcare spending will benefit insurers and healthcare companies. With the industry expected to increase by an average of 5.5% annually, the market remains healthy for investors in the following names:

Insurance Companies

1. UnitedHealth Group (NYSE: UNH)
2. Humana (NYSE: HUM)
3. Berkshire Hathaway (NYSE: BRK.B)

Healthcare Companies

• Amgen (NASDAQ: AMGN)
• Merck (NYSE: MRK)
• Bristol Myers Squibb (NYSE: BMY)

Article by: Francisco Cortez – Delgado
I graduated from Queen’s University with a Master’s of Political Studies. The intertwined world of politics and economics intrigue me. My favourite stories to cover are the ones that show how a few selected officials can impact nationwide macro-economic policies. I also follow the broader markets and FOREX.

• Nations that vowed to cut oil production have not lived up to their word
• The oversupply of oil has caused the commodity to fall 27% from a peak of $76 in September 2018 to a current price of $56/barrel

There’s a global surplus of oil, and in recent months some of the biggest producers have been promising to cut their output. An alliance of 21 nations known as OPEC+ is trying to remove about 1.2 million barrels/day to provide greater balance to the market.

Among them are OPEC members including Nigeria, Saudi Arabia and the United Arab Emirates, as well as non-members such as Malaysia, Mexico and Russia.

However, only 10 of the nations have achieved at least 100% of their target, while the others have fallen short. Below is a percentage of cutback target reached.

Notably, UAE (94%), Saudi Arabia (130%) and Kuwait (116%) have hit their target while Iraq (-11%), Nigeria (-102%) and Russia (18%) are not even close.

The price of crude oil will continue to struggle with an overflowing supply from countries that refuse to cut production.

Article by: Francisco Cortez – Delgado
I graduated from Queen’s University with a Master’s of Political Studies. The intertwined world of politics and economics intrigue me. My favourite stories to cover are the ones that show how a few selected officials can impact nationwide macro-economic policies. I also follow the broader markets and FOREX.

• Auto sales are down in China due to a slowing economy and US trade war
• In major developed markets such as Europe and North America, competitive threats from ride-sharing services have lowered the need for owning a vehicle
• Investors of General Motors, Tesla and Ford should be wary

The number of cars sold in China has fallen again, after the first annual slump in more than two decades. January’s drop of 17.7% in vehicle wholesales (below) was accompanied by an eighth consecutive monthly decline in retail sales.

Automakers are facing headwinds in all major markets. Chinese sales are down as the world’s second-largest economy slows and the trade war with the US drags.

The markets in Europe and North America are also shrinking as the increasing availability of ride-hailing and car-sharing services like Uber and Lyft makes it less necessary to own a vehicle.

These threats pose a problem for automakers already relying on razor thin profit margins. General Motors (NYSE:GM), Tesla (NASDAQ:TSLA) and Ford (NYSE:F) are all reporting profit margins lower than 5%.

Article by: Mick Ross
Mick is currently a full-time investor and formerly a buy-side analyst (2yrs) covering healthcare companies. Before that, he was a salesperson at a bulge-bracket firm, based in Dallas, Texas. Mick blogs to clarify and synthesize his investment thought process and to elicit feedback; additionally he likes to connect with other investors and swap ideas.

• Roche was the best selling oncology company of 2018, with double the sales of second place Celgene
• Bristol Myers Squibb acquired Celgene in early 2019, which will likely create the largest cancer company

Roche (OTC:RHHBY) generated over $25B in oncology sales for 2018 due to billion dollar drugs such as Rituxan, Herceptin and Avastin. Roche, however only saw a 2% growth in sales over 2017, which could indicate that its time as the top selling oncology company may be nearing an end.  

Celgene, was in second place thanks to their blockbuster Revlimid, which is also the best selling cancer drug worldwide. Their oncology division grew sales at 17% over 2017.

In January 2019, Bristol Myers Squibb (NYSE:BMY) announced a mega-deal to acquire Celgene in a $74B deal. BMY was in 4^th spot in 2018 due to the rise of immue-oncology Opdivo.

Combined, the two companies are expected to overtake Roche as the number 1 selling cancer company globally, as early as 2019.

Article By: Fatimah Aminu
Fatimah is an experienced editor at various financial and consumer publishing houses. She obtained a master’s degree in Publishing from NYU, where she earned a bachelor of fine arts degree. She is currently earning a second masters degree at CUNY online in Psychology. Fatimah covers healthcare, cannabis and technology.

• EV and renewable energy are progressing, but we are far away from having the necessary technology to make these the widespread standards.

The renewable energy push is real and progressing daily. The global fleet of electric vehicles is expected to reach 125M by 2030. Today there are roughly 3M EVs on the roads globally. Solar energy is expected to become a top source of energy production in developed nations like Germany.

Panels and EVs are reliant on batteries to store the energy once it has been drawn from the sun or recharged from an EV charging stations. This brings up the importance of lithium and energy storage.

Lithium is an essential component of the renewable energy future because of its use in batteries that store electricity and energy. Thanks to its lightweight and highly reactive properties, lithium is a necessity for renewable energy to work on a grand scale. It’s currently used in the batteries of EVs and the battery storage components of solar panels.

When discussing the future of renewable energy, lithium’s scarcity is overlooked. If all the conventionally-fueled cars in the world were replaced with electric cars overnight, the global supply of lithium would be completely depleted in just approximately fifty years. 

While both electric vehicles and renewable energy resources are still very far away from being widespread enough to threaten the world’s lithium stores in the near future, lithium itself is not really the point. It’s just one small problem that exemplifies a larger issue with renewable resources–they are not completely renewable, and we still haven’t discovered the technology to get around that fact.

Renewable energy still relies on several non-renewable resources. Solar panels, for example, can’t be made without the use of finite rare earth elements. Batteries, too, are completely dependent on finite earth-sourced materials for their fabrication.

Bottom line: EV and renewable energy are progressing, but we are far away from having the necessary technology to make these the widespread standards.

Article by: Francisco Cortez – Delgado
I graduated from Queen’s University with a Master’s of Political Studies. The intertwined world of politics and economics intrigue me. My favourite stories to cover are the ones that show how a few selected officials can impact nationwide macro-economic policies. I also follow the broader markets and FOREX.

• A barrel of oil has fallen in price, since peaking in October 2018. Yet not all countries have seen prices fall.
• Venezuela has cheapest gallon at $0.01 and Hong Kong most expensive at $7.61

Crude oil has fallen from a 52 week high of $75/barrel in October to just under $55 in February 2019. Each country has experienced a different story, however. Below is a chart showing which countries had the most affordable fuel and which were still feeling pain at the pumps.

Note: The lighter the shade of blue, the lower the cost.

The average price of a gallon is $0.01 in Venezuela but $7.61 in Hong Kong. Keep in mind that the USD is currency used to measure the price, so fluctuations in exchange rates will impact the USD price. In Venezuela’s case, the inflation of their currency, the bolivar, has made the price seem relatively cheaper than it actually is for locals.

Much of the Euro zone is seeing some of the highest prices, due to the fact that the commodity is imported from the likes of OPEC producers.

Article by: Francisco Cortez – Delgado
I graduated from Queen’s University with a Master’s of Political Studies. The intertwined world of politics and economics intrigue me. My favourite stories to cover are the ones that show how a few selected officials can impact nationwide macro-economic policies. I also follow the broader markets and FOREX.

• Reddit raised $300 million at a $3 billion valuation, up from a $1.8 billion valuation in 2017, when the company took in a $200 million investment.

• Reddit had focused efforts to clean its platform to attract advertisers

Reddit has faced criticism for its lax regulation around hate speech, piracy, harassment and even election interference. As a result, the social media company is seeing valuations much lower than peers because advertisers have shied from Reddit.

Reddit has roughly 330 million monthly active users (MAUs), making it on part with Twitter. Yet, monetizing efforts have been significantly lower. It’s estimated that Reddit revenues are approximately $100M. This means that each monthly active user is worth about $0.30.

To compare, Facebook (NASDAQ:FB) yields a average revenue per MAU of $7.37 and Twitter (NYSE:TWTR) of $2.83.

Reddit has focused its efforts over the past year on cleaning up its platform to build a better advertising model. As a result, it has cleaned up its site and focused on more lucrative advertising opportunities, primarily video. Investors have rewarded the company most recently with a $3B valuation.

Article by: Mick Ross
Mick is currently a full-time investor and formerly a buy-side analyst (2yrs) covering healthcare companies. Before that, he was a salesperson at a bulge-bracket firm, based in Dallas, Texas. Mick blogs to clarify and synthesize his investment thought process and to elicit feedback; additionally he likes to connect with other investors and swap ideas.