[Ed note: This article was originally published in June, 2013 when the shares of the stock teased, Alnylam (ALNY) were around $30 and the Oxford Club was saying that the first person to live to 1,000 is already alive ... now they're touting it as the "The Tiny Company About to Go 'Public' With True Fountain of Youth" and the company that will "unleash 'holy hell' on Social Security and Medicare, but the tease and the details (and the stock) are still the same.
What follows has not been updated, edited or revised, but ALNY is now a $3 billion company with a share price of roughly $50, it briefly hit nearly $100 and $6 billion earlier this year and was one of the better-performing large biotech stocks in a year that saw a real biotech bull market. I don't know a lot about the company or the science behind it, and didn't know much about it then either (sometimes I've got an opinion, sometimes I can just get you the stock name and ticker and let you get started on your own), so I'm republishing this instead of re-writing it -- that will let us stay connected to the original stream of comments.
I hope you find the following helpful, but it at least answers the question so many have asked: "what's Oxford Club's Fountain of Youth stock?"]
—-following was published June 29, 2013 and has not been edited or updated—
“Just one company stands to make the lion’s share from this radical life extension phenomenon…
“It’s locked down nearly every patent behind this technology.
“The founder of this company, a Nobel Prize-winning scientist, is the same man who founded one of the most storied biotech companies ever.
“His first biotech outfit saw its stock go from $3.08 a share to over $240 a share. That’s when his company developed and released a treatment for a debilitating – and often deadly disease.”
I can see why so many folks have been asking about this latest pitch from the Oxford Club — not only do you get that kind of exciting story, but you also get the coincidence that the folks who buy investment newsletters tend to mostly be in their 60s and 70s and quite interested in health and rejuvenation and life extension, and the ad came in under the headline that …
“The First Person to Live to Age 1,000 Has Already Been Born…“
Presumably that’s going to be one of the people who are a few months old now, and you also have to see a real exponential hockey-stick chart of life expectancy to get to 1,000 years old — along, of course, with a complete change to the structure of human life on earth — but the more realistic-sounding projections, based on some big breakthroughs like the one being teased here, are that it’s possible for adults alive now to reach 150 years of age, and that the longer you live the more science will catch up with you and push that envelope further. Of course, you won’t be able to retire at 65 if you’re looking at making those monthly condo payments for another 80 years after that, but presumably you’ll be so strong and vibrant that you’ll be working as a longshoreman for a little fun and pocket change in your spare time.
But anyway, this Oxford Club pitch is that there’s a spectacular biotech company that’s got RNA technology patents locked up, and visionary leadership, and they’re going to shoot to the moon over the next few years — starting soon as they release their next FDA trial results in the days and weeks to come, and accelerating by next year as Phase III trials and possible drug approvals get closer to reality.
And no, it’s not the same idea as the “God Switch” ads still being run by Patrick Cox and the Agora folks — that’s a different “become immortal” strategy based on stem cells and they were (and are, and have been for a while) teasing BioTime (BTX). This is a different approach to living “forever.”
Here’s some more from the ad, talking about the huge success this scientist had with his last company:
“In the next 90 days, we’re expecting an unprecedented and shocking announcement from this gentleman’s new ‘start-up’ biotech company…
“It’s a ‘coming out party’ of sorts for this technology.
“And when this news hits the mainstream media, I believe it could become the most talked about technology breakthrough of our lifetimes. And the stock is likely to storm up the charts as a result.”
Here’s how they describe the actual science … and let me just warn you, from here on out I’ll be playing the role of “dumb guy”, the science is out of my sphere of understanding:
“Think of your cells like tiny photocopiers. Even if you have the highest-quality printer in the world, there will be a problem if you make copies of copies of a photograph. The little imperfections add up. Eventually you won’t even recognize the image.
“But, consider if you just used the original every time you wanted a copy. Then you could make perfect replicas for years and years.
“That’s what this company’s technology does.“Its scientists have found a way to get the ‘original’ make-up of a cell. Its treatments convince the body to use the originals only, and to destroy any damaged ‘replacement’ copies.
“The industry term for this medicine is ‘RNA Interference.’
“Biologically it works like this…
“RNA is a messenger, copying genes from an old cell to a new cell. But what happens when RNA starts transmitting imperfections to the new cells? The answer is what we call aging… when these imperfections add up, and our body starts breaking down.
“But ‘RNA Interference’ stops the RNA from passing along these imperfections. It interferes with these mistakes, so your genes only pass along the blueprint of the original ‘perfect’ cell.
“In other words: All your new replacement cells can be as perfect as the original cells….
“Right now, doctors treat you by working outside in – using either invasive drugs or surgery.
“But using RNA Interference, it’s possible to treat disease by going inside out. That’s because this technology makes it possible to ‘turn off’ harmful genes.
“For example, let’s say one tiny cell in your body begins producing cancerous cells. With RNA interference, doctors can keep the cancer cell from ever reproducing.
“In other words, you can destroy the cancer inside your cells, before it starts.”
And here’s the understatement of the day:
“It’s unlikely you’ll be able to get a shot or pill in the next five to 10 years to get you to age 1,000.”
But they turn that into “still damn good” in the following sentences:
“After all, RNA Interference is still a very new technology…
“At its current level of development, we are perhaps decades away from using it to live a thousand years.
“That said, I am certain this company’s technology will be used to add as many as 60 to 70 additional healthy years to your life.”
Not bad, eh? So which company is this? Clues, please:
“… a small, American-based company, near the campus of MIT.
“This unknown company has unlocked the secrets of RNA. At this very moment, it’s administering these treatments to hundreds of Americans… But those numbers could be on the verge of a dramatic rise. And here’s why…
“We are only months away from an explosive announcement from this biotech company… One that could show up on the front page of every financial newspaper and website across the country.
“This is the start of something bigger than the introduction of flight by the Wright brothers. Even bigger than the birth of personal computers in the 1970s….
“The company I’ve been telling you about was founded by a scientist we’ll call ‘Dr. Allen.’ Dr. Allen is one of our greatest living scientists. In the 90s, he won the Nobel Prize for a different biotechnology, something called gene splicing.
“He’s also a professor at MIT and a member of the prestigious Royal Society of London, which once included Sir Isaac Newton among its members.
“But beyond his many scientific credentials, Dr. Allen is also an incredible businessman. In the late 70s, he founded a company we’ll call ‘Bio-Inc.’
“It was a tiny start-up at the time, but today that company has over $2 billion in annual revenue.
“You’ll be interested to know that Bio-Inc’s stock is up more than 7,547% since Dr. Allen founded it.”
Sounds intriguing, no? Any more little details that we can feed into the Thinkolator? Perhaps just a few …
“… only a $1.3 billion market cap …
“It owns nearly all the patents related to RNA Interference… over 700 granted patents worldwide for RNA Interference. In total, it has over 300 granted or issued patents in the world’s major pharmaceutical markets – the United States, E.U., Japan… No other company comes this close to completely controlling this technology….
…it’s arranging 30 licensing deals with pharmaceutical and biotech companies right now. And even more deals are expected soon….
“Dr. Allen’s latest company has an advisory board made up of scientists from Harvard Medical School, MIT, Howard Hughes Medical Institute, Swiss Federal Institute of Technology and Koch Institute for Integrative Cancer Research. In just three months, this company will announce incredible medical results, which could shoot its stock to the moon.”
OK … so that’s the pitch on the company — how are they going to make us rich? We’re told that there’s a catalyst coming soon — results from one of their trials:
“Dr. Allen’s company is on the verge of announcing incredible results from a Food and Drug Administration study about its top RNA Interference medicine.
“This study, conducted with the Boston University School of Medicine, will be shocking even to most doctors.
“We know. We’ve seen the earlier FDA reports for ourselves.
“The results of this announcement should lead to immediate Phase 3 approval from the Food and Drug Administration. Meaning…
“The first RNA Interference treatment of its kind will soon be commercially available in the U.S.”
“… laser-focused on a treatment for a rare ‘orphan’ disease. By taking this unusual route to get this medicine on the market, the company cut down the final approval time for its RNA medicine to as fast as 12 months.
“Specifically, Dr. Allen’s team is going after a terrible, genetic disease that more than 40,000 people are diagnosed with each year. Most die from it within three years.
“At this point, Dr. Allen’s company is winding down its Phase 2 trials treating this ‘orphan’ disease… based on early reports we’ve seen, after a single dose of this RNA medicine, patients had a 94% reduction of the protein causing this genetic disease. In other words, most of the problems were “turned off” after a single treatment. In addition, side effects were non-existent… we fully expect this treatment will almost certainly pass into final Phase 3 testing in the next three months. And when the company announces this next stage of approval, this event alone could be worth millions in profits.
“The door will be wide open for brand new medicines developed by Dr. Allen and his scientists. In fact, they’re working on five new treatments as we speak….”
So who is being teased by the Oxford Club folks here? Thinkolator sez it’s Alnylam Pharmaceuticals (ALNY), which was actually one of the top teaser touts of 2012 after the folks at Casey Extraordinary Technology teased it back in May of last year at about $10 a share (it went to $18 or so at the end of the year, and recent strength has driven it to $30).
I think you probably all know well that I’m no doctor, and no scientific expert, but Alnylam Pharmaceuticals is a very active developer of early stage drugs that use RNA interference or RNAi technology — they’re not the only ones, there are other competing platforms and strategies that also aim to lasso the “turn off a gene” power of tinkering with RNA, including the one that’s probably a bit more well-known, Isis Pharmaceuticals (ISIS). And yes, ALNY is headquartered in Cambridge, not far from MIT, and the big brain on the board is Nobel-winning RNA-splicer (and MIT faculty member) Dr. Phillip A. Sharp — the A is for Allen, in case you’re wondering where the “Dr. Allen” bit came from.
They are also expecting Phase II data from their lead trial sometime this Summer, that’s the trial for their “orphan drug” to treat TTR Amyloidosis (the drug is called ALN-TTR02 at this point), and they do see this moving into a Phase III pivotal trial by the end of the year (assuming, of course, that good results continue). This is an exceedingly rare and terrible disease with no effective therapies, so the treatment would have to be pretty bad to not at least get the drug a fighting chance. You can see the rest of the pipeline here, the goal of the company is to advance at least five compounds into advanced stage clinical trials by 2015 (they call it their “5 in 15″ campaign), which would presumably help to validate their RNAi platform and patents and technology and get other partners on board to work on other diseases.
The company has had a pretty steady drumbeat of positive-sounding announcements during the first half of this year, which has helped to spur the shares higher, and the last note I saw in their quarterly annoucements said they expect their Phase II TTR02 results by the end of June, so that’s awfully dang close to now … along with a “data rich” period of expected information being released about their preclinical and less-advanced products over the next few months. They’ve also been making the rounds of investment conferences recently, so you can check out some of those presentations here if you’re interested in hearing their pitch more directly, or the latest earnings call transcript here. That said, they’ve had plenty of periods of weaker news as well — they had a different Phase II trial fail a bit over a year ago, so these are not guaranteed compounds.
Financially, ALNY’s stock price can really only be justified because it’s a biotech stock that investors believe is creating a platform that will lead to a series of novel drugs inching closer to the market over the next several years. Their revenue is minuscule for a company that has a market cap now of almost $2 billion, and they have a couple hundred million in cash on hand but that’s only because they issued new stock this year to raise cash — they will be using all of that cash and more as their clinical development programs move forward, trials are expensive and they get more expensive as you move along to later stages (though their lead candidate, with a very small number of afflicted patients and orphan status to speed things up, may not cost as much to usher through the process as the average drug). The stock trades on sentiment about their clinical trials, and about speculation about what a real platform for RNAi drugs might mean — which almost means the share price is irrelevant, you can argue that the company is worth $500 million or $1 billion or $5 billion or whatever number in between, but it’s all based on the current drugs, all in early stages except for their lead orphan drug, continuing to show the promise of RNA. Massive returns from here, as have been achieved by a few biotechs that made the leap to becoming real “big pharma” names with real products and profits, are possible, I suppose, but that depends on the science working. And probably on a bit of luck, as well.
Oh, and yes, “Dr. Allen” was involved with one of those previous mega-successes — the stock they tease as “Bio-Inc” is Biogen-Idec (BIIB), and Dr. Sharp was the founder of Biogen. If performance like Biogen’s is the goal — and that would be a lofty goal, indeed — then it’s worth noting that even this clearly spectacular company has had some very weak periods of stock performance, so investors would have had to show either great prescience or great patience to enjoy all of that run. BIIB has been a huge success since 2000, running from $50 to almost $250 in just a couple years, and it was also hugely successful in the 1990s, running from a couple dollars in 1990 to almost $50 in 2000 … but it also had a “lost decade” there in the middle, bouncing from $35 to $70 and back again several times in the 2000s as their lead drugs showed promise and disappointment along the way.
ALNY last had a heyday for investors in the mid-2000s when their first compound were being readied for the clinic, and RNAi and SiRNA and other technologies and techniques to silence genes were just getting investors excited for really the first time. RNAi and the like have been very promising but very challenging develop for at least a decade now — that oft-cited quote that was in the ad that this is “The Greatest Medical Advance Since the Discovery of Antibiotics,” from an article in New Scientist, was published in 2005, when the first clinical trials for RNAi drugs seemed likely … it always takes longer than you think, and the FDA is always extra-worried about brand new treatments or technologies.
From what I can tell in the dumbed-down articles I’ve skimmed, the biggest issue with RNAi is how to delivery it to the right cells, a challenge that is being addressed in many different ways (intravenous, subcutaneous, oral compounds with engineered coatings, etc.).
Anything else I say about the technology or the company’s drugs in development will only further illustrate my ignorance … so I can tell you that the Oxford folks are almost certainly teasing Alnylam, but I don’t know what the news will be from their Phase II trial in the weeks (or days) ahead, how the other compounds in their “five in 15″ campaign will develop, what partnered drugs might bring in milestones in the years to come, or how strong their patent portfolio is. This is a very young science still, at least when it comes to actually developing drugs, so I can easily see a successful drug approval in a couple years, if it does indeed come, being hugely important even if this first orphan drug won’t be itself a big enough seller to “make” the company.
If you’ve been an ALNY investor or follow the stock, or just paid more attention in science class than I did, feel free to jump in and let us know what you think of this one.