Sunday, January 6, 2008
RNAi Therapeutics Model Portfolio
1) Initial balance: $10,000.
2) Initial purchases are made based on last Friday’s closing prices (January 4, 2008).
3) Currency fluctuations are not taken into account.
4) Sales/Purchases based on closing prices and are posted on the blog the same day.
5) Updated portfolio balance will be displayed at the beginning of each month.
Some comments on my selections:
Alnylam: The proven leader in RNAi Therapeutics. Human proof-of-concept data, new collaboration deals (including for Regulus), ability to file for new INDs, and the upcoming Novartis adoption license decision as potential value drivers. Main concerns: human proof-of-concept taken for granted by market and priced in and delays of systemic delivery programs.
Tekmira: Most speculative position in my portfolio. Timely advancement of SNALP-enabled RNAi development programs into the clinic should be well received and trigger a significant bounce in the stock. Strong Alnylam relationship with R&D essentially paid for by Alnylam. Main concerns: making SNALPs safe enough for clinic may take more time than anticipated, and protracted Protiva litigation.
ISIS Pharmaceuticals: Partnering of mipomersen (ApoB100 antisense) could be eye-opener for how much Big Pharma is willing to pay for novel RNA-based therapeutics. Growing revenue stream from IP (esp. from Alnylam, but also other companies based on RNA technology), diagnostics, and licensing out antisense programs. Should also benefit from Regulus deal. Main concern: Safety of mipomersen.
Benitec: Main DNA-directed RNAi player. Potentially lucrative, lean IP licensing model with some strategic investments in clinical programs. Main concerns: weak balance sheet and currently shaky patent estate; perception of DNA-directed RNAi versus siRNA-mediated RNAi.
Rosetta Genomics: Main publicly traded microRNA diagnostics player with potentially large, valuable microRNA target IP estate set to commercialize first microRNA diagnostics products and looking for partnering opportunity. Main concerns: issue of patenting microRNA sequences and pre-mature focus on microRNA therapeutics.
Nastech: Punished stock should recover if they can capitalize RNAi spin-out MDRNA on favourable terms. Strategy of patenting the steps of RNAi around the classical Tuschl siRNA design could attract partnering interest from Big Pharma. Main concerns: poor negotiation position with credibility problem and weak balance sheet; unvalidated IP.
Silence Therapeutics: So far productive RNAi Therapeutics engine and deal flow. Depending on the eventual scope of Kreutzer-Limmer I and ability to get their own patent applications granted, a takeover candidate by Big Pharma.
CytRx: Tuschl I play. Main concerns: delay of Tuschl I, getting their RNAi therapeutics R&D into gear and spinning out RXi.
Targeted Genetics: DNA-directed RNAi play with Sirna/Merck relationship. Leading AAV gene therapy company that should benefit from the fact that AAV is very promising for RNAi delivery to the liver, eye, and brain, with near-term clinical opportunities. Main concerns: perception of DNA-directed RNAi versus siRNA-mediated RNAi.
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