Dave Lashmet’s got a new ad out for his Stansberry Venture Technology ($2,500 “on sale” at the moment, list price $5,500, no refunds), and it’s pretty exciting — he talks up a big announcement that will be coming in less than two weeks, and tells us that it’s going to bring us a big step closer to a “cure” for cancer. Here’s the intro:

“On October 23, the world’s leading doctors and scientists will gather to hear what could be a historic announcement. It could change the way we treat one of the world’s deadliest diseases… and could send a flood of money into just THREE companies.

“Their exclusive patents could soon be worth up to $150 BILLION… and lead to multiple gains up to 400%+ no matter what’s happening in the market…”

And he fills it out with some storytelling, to help you imagine this payday…

“On October 23, 2022…

“5,000 of the world’s leading doctors and scientists will meet in a giant auditorium. Thousands more will tune in online… all to witness what could be a historic announcement.

“It could change the study and treatment of one of the world’s deadliest diseases… something one in three Americans will suffer from.

“But it could also send a flood of money into three companies.”

Whatever are those three companies? What is this big announcement? Have no fear, we’ll jump in and dig out some answers for you.

As with a lot of teaser ads, this one is built on a few different events and developments that together paint a picture of a potential change — in this case, a change in the way cancer is treated. He’s talking about a conference presentation of some clinical trial results that might make a new kind of radiation therapy leap forward as a front-line treatment, but also about how that might work in conjunction with immunotherapy drugs to really provide a functional cure for more people.

The radiotherapy one is the big announcement, the October 23 story… so let’s dig into that first:

“I dug and found the exact room this announcement will be made in. No one waits to reveal their data in a venue – that seats thousands – unless they have major news…

“Think about it…

“If you had a choice to just publish your research in a journal… or be cheered on by 5,000 peers at one of the biggest conferences in the world… which would you choose?

“Especially a conference that specializes in treatments for one of the world’s deadliest diseases you’re trying to treat.”

He references some other hints, including a redacted tweet from the research facility hosting this breakthrough testing, and it’s clear that what he’s referring to is the 2022 Annual Meeting of the American Society for Radiation Oncology (ASTRO), and specifically about a paper that will be given detailing the results of a FLASH radiotherapy study on Sunday morning for conference attendees, then followed up with a press briefing (for that paper and several others that they expect to be worthy of press attention) on Monday morning.

And as one of the images in Lashmet’s presentation hints, the content of that “special session” presentation is currently “embargoed,” so they haven’t released it yet — the title of the presentation is, “FAST-01: Results of the First-in-Human Study of Proton FLASH Radiotherapy.”

And while this study is small, I think it had ten patients, Lashmet says that he expects it to be successful, and to move markets… in his words…

“We’ve been waiting for the announcement of trials that have a strong chance to be successful.

“For an announcement that could act as the catalyst to move markets….

“And if everything goes as I expect… while doctors are clapping… journalists are racing to hit their deadlines.

“Know this: Money WILL be moving.

Are you getting our free Daily Update
"reveal" emails? If not,
just click here...

“It could flood into the companies behind this breakthrough, sending these stocks up as high as 400%.”

So what’s the story of what he says is the “biggest headline in medicine” that “hasn’t been printed yet?” Well, it’s apparently not an “all or nothing” moment for the investments he’s talking about…

“I’m not going out and investing in some biotech startup just getting off the ground. At least, not right now. This is not the time for that. This is the time to weigh risk and reward.

“It’s the time the find the right companies that have good products and steady revenue streams already in place… but are on the cusp of a new breakthrough that could launch them into an incredible new market revenue.”

But they still load up on the importance of buying NOW, before the news is reported… this is from the guy “interviewing” Lashmet, Stansberry editor Scott Garliss…

“The secret to seeing extraordinary gains is getting in at the RIGHT moment.

“Like when you told readers to buy a $16 stock called Regeneron before it soared 3,193%”

Assuming that’s true, and Lashmet was behind a Stansberry recommendation to buy Regeneron that year (he didn’t have his own newsletter way back then, in 2002), then yes, it would have worked out very well… but it took a really long time. Just to give some back story, REGN lost 60% of its value within six months of that recommendation, and trailed the market with very weak returns for about seven years, so it was essentially “dead money” until after the financial crisis in 2009, when it really started to take off. It looks spectacular in retrospect, but be honest with yourself — many investors do not have the stomach to stay with a volatile investment for that long, or to wait seven years for a stock to begin to have it’s day in the sun. This is not an easy kind of investing, speculating on biotech stocks that don’t yet have a product for sale — it only looks easy in retrospect, when you can look back and say, “of course, I would have bought it and waited for that 3,000% return.”

This is what that Regeneron investment would have looked like, compared to the S&P 500, since that 2002 recommendation at about $16.

That looks great… but the huge returns from 2009 to 2015 really mask how hard those first seven years were… we get a better idea of that if we look at the log scale chart for that same time period. that purple line is REGN bouncing up and down for years while people overreacted to clinical trial results:

I say that not to dissuade you from biotech speculation, or any kind of high risk investing, just to remind you that it’s a lot harder in real time than you’d expect — both because there’s a lot of failure, and the companies who bounce up and down for years could just as easily lose 90% of their value as gain 3,000% in the end, and because, even if you are right about the end result and you’ve chosen the right stock and the right drug to get behind, you won’t be sure that you’re right until later, and those first seven years of REGN were filled with periods when the headlines were ugly and the stock market was trying to scream at REGN investors that they were wrong. Being yelled at by a stock like that is hard to stomach, but if you want to make long term bets on speculative products (like drugs that are still in clinical trials), then it’s part of the deal — you have to be patient, and you have to accept that even when you do what you’re sure is the right thing and wait it out, you still might “lose.” There are a lot of frogs in the swamp, they don’t all turn into princes.

And he gives a little back story on this radiation oncology stuff…

“… three years ago, almost to this very day, I reported a similar story to Stansberry readers.

“I had just learned about a cutting-edge theory at a conference in Chicago back in 2019.

“Today, that ‘theory’ is printed in medical journals and textbooks around the world as fact.

“What I learned in 2019 wasn’t the cure yet… but it was as close as we had come to date. Until now….

“You see, it’s at this same conference… days away on October 23… where we could finally get the missing puzzle piece needed to actually say what doctors have been waiting centuries for.

“It involves taking what we learned about in 2019…

“And merging it with a second treatment.”

So that rings a bell — he had a very similar tease about advancing closer to a cancer cure back in 2019, saying at the time that the combination of radiotherapy and immunotherapy was showing signs of providing a “1+1=4” treatment to knock out some cancers. The particular stocks he hinted at didn’t have any great returns in the subsequent years, but it was a good story.

And apparently it’s getting better…. more from the ad:

“In 2019, I reported on a new radiation therapy, called targeted radiotherapy.

“Dave began tracking this breakthrough story back in 2019 with new radiation therapy. But today, there’s a new technology that, on its own, is proven to be 11 times more effective.

“It was more precise than typical radiation treatments….

“Back then, it was considered groundbreaking…

“But today, there’s a new technology that, on its own, is proven to be 11 times more effective than even radiotherapy.”

So what’s this advancement? Well, as you can guess from the title of the conference paper that will be reported in a week and a half, it’s FLASH radiotherapy…

“It’s better than anything else on the market, ever.

“And delivers doses of radiation up to 1,000 times faster than what most doctors use today.

“It’s like replacing a sledgehammer with a scalpel.

“…. a method called FLASH radiotherapy.”

And while this report on October 23 is about the first trials of this technique, apparently this is not the first “results” information that has come out about this kind of treatment. Either that, or he might be referring not to this first clinical trial, but to the first time this was tried on a human, which reportedly was in 2018 in Switzerland:

“… the most important thing to note is that in the first human trial, the tumor treated with flash radiotherapy completely dissolved without any severe reaction, much faster than the ‘normal’ treatment time.

“And it’s far, far less painful.”

FLASH radiotherapy is essentially the use of targeted much higher doses of radiation, but in very short bursts of time. So while Lashmet was excited about past advancements that indicated an abscopal effect on cancer if you combine immunotherapy drugs and radiation, the hope is that if FLASH radiotherapy itself is much more effective than regular radiotherapy, maybe that overall impact on cancer will be greater, too.

The abscopal effect is when local therapy on a specific tumor also makes tumors in other parts of the body that weren’t directly targeted shrink or disappear.. with the idea being that the radiation in that one area also may help the body to fight the cancer more broadly, he refers to that in the ad here:

“As effective as each of these treatments – flash radiotherapy and immunotherapy – are on their own… the magic happens when they’re used in unison.

“The real story – the one that’s barely yet known even among doctors and research scientists – is what happens when you put the two together.

“The combination harnesses a scientific effect in the body so extraordinary it was once thought to be a myth.

“This combined treatment, known as flash-radioimmunotherapy – opens the door to the treatments we’ve been waiting for.

“Something remarkable happens when you put radiation therapy and immunotherapy together.

“The effects are synergistic.

“See, the combination of radiation and immunotherapy unleashes a powerful effect in the body.

“Doctors have called it the unicorn of cancer treatment.

“It happens when you treat cancer at just one site in the body… but then it starts to disappear everywhere.”

Lashmet has been talking up that abscopal effect (I agree, “unicorn effect” sounds better) since at least 2015, and he seems doubly sure now that we’ll hear big news about this…

“This ‘unicorn effect’ is about to make headlines.

“Now, we not only know how to make ‘the unicorn effect’ happen routinely – across many types of cancer…

“But what we’re going to see on October 23 is this phenomenon being taken to a whole new level.

“All by combining two treatments that are EXPONENTIALY better than the simple radiation and immunotherapy treatments used back in 2019 when this ‘unicorn effect”’ discovery was just made.”

That sums up most of the sales pitch. So… what are the companies who will end up benefitting from this latest breakthrough?

Essentially, after those big promises of an October 23 announcement, it comes down to three stocks Lashmet likes. One of them is an immunotherapy treatment pioneer, and two others are leaders in radiotherapy, and presumably well positioned to sell more machines and provide more services if FLASH radiotherapy becomes the standard of care for cancer in the future. Here’s when he starts talking about the specific companies…

“These technologies are so new and unchallenged, these three companies share ownership of the most coveted patents in medical science now.

“One of them has won lawsuits against every top cancer drugmaker that has tried to copy the success of their immunotherapy drugs. Now, they collect a royalty on every single life-changing immunotherapy drug sold.

“More so, any company that gets an immunotherapy drug approved in the future… has to likely pay this company a royalty…

“On every drug they sell.

“That’s the power of a patent and market dominance – they’re taking a cut of every immunotherapy drug.”

So who’s that? Bristol Myers (BMY) is the easier choice here, they are getting some royalties on Merck’s (MRK) Ketyruda after winning a patent case about infringement on Merck’s Opdivo-related patents… but the Thinkolator sez that Lashmet is probably actually teasing BMY’s partner, the Japanese R&D firm Ono Pharmaceutical (4528 in Tokyo, OPHLY or OPHLF OTC in the US) — BMY did recently sue Merck, and win a settlement and royalties on Keytruda, but Ono, who helped develop Opdivo and is a 25% partner with BMY, is a part of that lawsuit, too, so will earn some of the royalties… and Ono has also sued AstraZeneca (AZN) this year for infringement, and before that, Roche (RHHBF, RHHBY) (for Tecentriq), winning some other settlements in the past that seem to validate their patent rights.

And Ono itself has also been sued to get a bigger piece of the pie by their contractor, the actual innovator, Tasuku Honjo, who won the Nobel Prize for identifying PD-1 and therefore did foundational work in harnessing those proteins to kill cancer. He wants a bigger cut of the revenues than was originally agreed — I’m not sure what the status is of that complaint.

Ono is relatively small (market cap around $11 billion), pretty inexpensive (15X trailing earnings), and pays a little dividend, so it’s probably got less downside risk than the big pharma companies who spend a lot more freely on drug development (ONO generally partners instead of spending heavily on its own), and it does have some exposure to royalties on at least most of the big immunotherapy drugs right now. The challenge over the longer term might be that royalties run off fairly quickly in pharma, due to patent expirations, so a lot will probably depend on whether Keytruda and Opdivo and the other key drugs continue to grow for the next several years before generic competition (or better drugs) enter the space.

So that’s the immunotherapy one, sez the Thinkolator… what about the two radiation ones?

“Those two companies own almost the entire flash-radiotherapy market.

“And what’s great about the flash-radiotherapy market… is that, in a way, their patents will never run out….

“Two words: Maintenance contracts.

“Nurses can’t service these machines. Every firmware patch and software update needs to be FDA approved, so it’s an extremely specialized market to be in. This means endless revenue streams.

“And the two companies sitting on flash-radiotherapy patents are among the first in this space. Which is why they have a 95% controlling stake of the market… and that market is showing extreme early success.

“I see both of these companies gradually taking over control of the radiotherapy market, which is expected to be worth $8.1 billion by 2027.

“And that’s not including the radio-immunotherapy market, which early data shows will grow to $100 billion.”

So what are those two commpanies? Well, the one that’s actively involved with this first trial of FLASH radiotherapy that will be reported at ASCO on October 23 is Varian, which is now owned by Siemens, an $80 billion giant of a company that’s sort of like the German equivalent of General Electric… but it’s also now listed somewhat separately as part of a Siemens subsidiary called Siemens Healthineers (SHL.DE, SMMNY, SEMHF).

Despite the silly name, and the horrifying launch song and dance routine a few years ago, Healthineers is, frankly, probably the most interesting part of Siemens. Even if you’re not super-excited about Varian’s radiotherapy work, they are a leader in medical imaging and in healthcare management software in a variety of ways, the debt is low and the return on equity is high and the valuation looks pretty reasonable (about 22X trailing earnings)… despite the fact that health care spending has not yet fully recovered from the COVID shutdowns. Siemens (SIE.DE, SIEGY) still controls Siemens Healthineers, they still owned about 72% of the company after the Varian acquisition went through in 2021. The Healthineers subsidiary has a market cap of about $47 billion, so they’re very large, and Varian and its various radiotherapy businesses should account for roughly a third of that value.

FLASH therapy can apparently be delivered by proton therapy machines, which were already the high end of radiation therapy and have been somewhat slow to “take off” as a major treatment for cancer because of the higher cost of the machines and treatments (relative to conventional radiation therapy). Varian makes proton therapy machines, but also makes many other types of radiotherapy and radiosurgery equipment… so they are not a “pure play” on proton therapy, but they are one of the two leaders, at least in the US.

Which brings us to the second one — what’s the other stock?

That’s very likely Ion Beam Applications, also sometimes called IBA (ticker IBAB in Belgium, IOBCF OTC in the US). This is interesting primarily because it’s such a pure play on proton therapy — and because it’s profitable, albeit only marginally so, which means they’re in a decent position to capitalize if proton therapy grows dramatically… which would be the end result, most likely, if this FLASH radiation therapy ends up becoming the mainstream standard of care.

It’s also MUCH smaller, this is an established company and has been public for a long time, with a network of proton therapy centers in the US (albeit a network that has grown much more slowly than investors expected a decade ago), but it’s got a market cap of less than $400 million, so if the impact of these advances in FLASH radiotherapy is more demand for proton therapy equipment, they would presumably benefit more quickly and more dramatically from that than would Siemens Healthineers and its Varian subsidiary. Though “quick” isn’t the word typically used for the speed with which proton therapy has grown as a treatment option.

There are other providers of proton therapy, and other companies who make the equipment, but they’re relatively less available to investors — some that have won at least a few installation orders are still private, like Mevion Medical Systems or ProTom International, and we don’t really know anything about their financials, others are part of very large companies that do a lot of different stuff, notably including Hitachi, which is probably the third largest player in the US market after Ion Beam and Varian/Siemens.

Ion Beam is the leader in installed systems, having gotten well ahead of the story while proton therapy was seen as an expensive luxury, so they may be poised to benefit nicely if Proton enters the mainstream and the usage of their centers goes up, and Varian is the well-financed alternative that’s got Siemens heft behind it to win new contracts and build on what is probably a second-place position in the US market. And Varian/Siemens is doing these first-in-humans clinical trials of FLASH therapy, both the one whose results are being announced in detail in about ten days and the second trial that is approved to begin enrolling patients, so it’s entirely possible that they’ll get more attention as a result.

I thought Ion Beam was pretty reasonably valued for the growth they were expecting back in 2015, when I first saw a Dave Lashmet tease for the stock — back then, as now, Ion Beam and Varian were the two big competitors, and Varian would have worked out much better for investors over those years, partly because they were acquired by Siemens Healthineers in 2020 at a nice premium but mostly because Ion Beam has been pretty disappointing, with no real earnings growth materializing over the past seven years. Both may will still be rational ideas here, though that’s partly because proton therapy has gotten somewhat higher acceptance in recent years, and because there are a bunch of studies underway to compare proton therapy with conventional (and cheaper) radiotherapies, and that means there may be room for this segment of the market to grow handsomely if those results are good. With or without this new FLASH radiotherapy leap forward.

So what does that mean for our future riches? I don’t know what the timeframe will be for approval for FLASH therapy, or for proton therapy in general becoming more popular than other radiotherapy techniques (that probably depends on getting to the point where some “big” cancers, with a lot of patients, are obviously better treated by proton therapy, with clearly better clinical results), but the regulatory approval timeline is pretty much always a LOT shorter for a medical device for approving a new drug.

Which doesn’t mean fast approval leads to fast riches. Proton therapy itself has been approved since the 1990s, but there are fewer than 50 centers in the US that offer it today… there are optimistic “now it’s time for proton therapy” stories every year or two that give some hope, like this one from last year, but so far progress in making this kind of therapy more accessible (and affordable) has been very slow. It’s not the FDA slowing down that part of the business, it seems to be the business part — the cost, the insurance coverage, and the clinical research needed to support investments in expanding proton therapy.

Part of that is just that it’s capital intensive, ordering up and building a new suite for proton therapy has sometimes cost well over $100 million in the past, though smaller machines and innovation are providing more and cheaper options now. Even $20 million is a big investment — hospitals and radiotherapy centers have to choose where to invest, do you get a new MRI suite, or maybe those MR-Lidac machines from Elekta that combine an MRI with targeted radiotherapy, or do you commit to proton therapy? With relatively few patients being treated with proton therapy, or getting insurance approval for that treatment, it might be a tough investment decision, at least until (unless, I should say) more data comes out about proton therapy being much better for survival rates, or even providing a more dramatic abscopal effect. Every time I see studies about proton therapy I think it sounds amazing, but progress has been extremely slow. That might continue to be the case.

Let’s just leave it at this: Varian’s existing equipment, and presumably also Ion Beam’s existing equipment, can be modified to provide FLASH therapy if it is approved and becomes popular, so that might increase the demand… and proton therapy often shows signs of being the next big thing, so perhaps news will be strong on that front as more clinical studies support that form of radiation therapy, too… but neither of those possibilities means that every existing hospital will be ordering new proton therapy equipment next year.

Part of the challenge is that Lashmet peppers the ad with dramatic graphs of 3,000% gains, which have generally come from breakthrough biotech stocks that turned out to have valuable drugs in development and leapt forward over a period of time or got acquired, with sometimes big 100% jumps in a single day… but what he’s actually recommending here seem to be much more conservative ideas at this point, established companies with cash flow, and they’re fairly well known.

Which might be good, I can see why you’d want to invest in those kinds of companies in this type of manic market, something that’s relatively solid and is likely to earn a profit feels better after the rollercoaster of wild growth/no profit stocks we’ve been riding since 2019. But it does mean you might have to be a little more sober in your expectations — the ad promises 400% gains as the potential, which is aggressive enough on its own, but those charts of 3,000% gains and quick 100% pops really do get into your head and impact your thinking if you’re not careful. Especially when a specific date is teased as a critical moment… as is almost always the case with biotechs.

So remember… when a newsletter ad has a critical date in it, a shocking announcement that will be made in a week or two, the main reason they are trumpeting that date is because it works. Not that it works to pick a stock before an FDA announcement or another news release, though that’s also sometimes true, but that it works to convince people to subscribe to a $2,500 newsletter, no refunds allowed, because the argument is strong and the deadline is near and that gets some people that extra “FOMO” rush to pull out their credit card before they even know what they’re buying. In the world of newsletter promotions, deadlines close sales. If there isn’t a real one, they’ll make one up… if there is a real one, as is the case here, they’ll probably exaggerate its importance.

So… what’s going to be the word on this first FLASH radiotherapy trial a week from Sunday? I don’t know, but hopefully it will be good news, and those patients had great results. Presumably it’s at least not horrible, because they’ve already been approved to move forward with the next study, FAST-2, with the approval for that second trial supported by the data from the first trial (FAST-1) a few months ago, even though the full data has not been released publicly yet.

I don’t own any of these stocks, and I’m no expert on the current state of immunotherapy or the “next big thing” in radiation oncology, but they all sound somewhat reasonable to me.

With your money, of course, it’s what sounds reasonable to you that matters — so feel free to share… do you like Siemens Healthineers and their pretty diversified healthcare technology portfolio, or Ono Pharmaceutical and its royalties on immunotherapy drugs and other drug development work, or Ion Beam and its network of proton therapy centers? Have other favorite cancer fighters, or think there are problems coming for any of these names? Let us know with a comment below. Thanks for reading!

P.S. Lashmet also teases an obesity drug in this ad, as an “add on” special report subject… he says “participants in the FDA-approved study lost an average of 37 pounds – without dieting and exercising…. The very first approved drug will change everything… and finally win the war against one of the fastest-growing diseases in the world.”

That is almost certainly a repeat of his pitch for Novo Nordisk (NVO) and their Wegovy weight loss drug, we covered Lashmet’s bigger tease about that story late last year here. It seems likely that Eli Lilly’s (LLY) similar diabetes-and-weight-loss drug, tirzepatide, will be the next big story in that space if it gets approved for weight loss, so there will probably be competition, and maybe that’s putting some pressure on Novo, but the share price is about where it was when I covered the story last December (Lilly is up nicely, they’ve been everyone’s favorite big pharma stock post-COVID). Those are two gigantic companies, with established and profitable businesses and valuations that assume at least some success in weight loss… and it’s a mainstream enough story that they got covered by Barron’s last month. Hard to say what the “upside surprise” might be with either, but boy, if someone figures out a safe weight loss drug that can be priced reasonably to really hit the mass market, that’s gonna be one heck of a market.