Finding the Winning 6% of Drugs

Episode #354 | March 25, 2024

Episode #354 | March 25, 2024

Finding the Winning 6% of Drugs

In This Episode

On this week's Stansberry Investor Hour, Dan and Corey welcome fellow Stansberry Research analyst Dave Lashmet back to the show. Dave is the editor of Stansberry Venture Technology and specializes in finding under-the-radar technology, biotech, and medical companies that have outstanding growth potential.

Dan and Corey kick off the show by arguing against the Federal Reserve potentially cutting rates this year. They point out that inflation is persistently volatile, gas prices are soaring and hurting everyday consumers, and the Fed is "pretending that everything is OK," according to Corey. Dan also brings up the fact that 2024 being an election year may have something to do with this.

Next, Dave joins the conversation to discuss the biotech industry. He explains that he doesn't see biotech as a sector, and rather he looks bottom up at biotech companies to find a drug that will have a macroeconomic effect. Because only 6% of drugs that start a Phase I trial succeed, he says being selective is crucial. Dave also describes the three phases of drug testing and the importance of efficacy and safety data. Speaking about how he picks winners, Dave notes...

You have to figure out some way to pick not only the drugs that will work, but the drugs that will work with limited competition in a mass market with large morbidity or mortality if it's not treated.

After, Dave talks all things weight-loss drugs. He reflects on how he knew Ozempic was going to be a blockbuster drug from his boots-on-the-ground research, the incredible room for growth in this area, and the unprecedented amounts of money that biotech companies are spending on factories to develop these weight-loss drugs...

We know the demand is there. What's stopping these weight-loss drugs from continuing to build at 140% CAGR [compound annual growth rate] is supply, not demand.

Further, Dave discusses why the obesity epidemic has worsened over the decades and how exactly weight-loss drugs work to increase metabolism and suppress appetite. It involves something he calls the "winter switch." Plus, Dave brings up the U.S. Food and Drug Administration approving these drugs for the purpose of reducing strokes and heart attacks by nearly 20%.

Lastly, Dave talks about the widespread economic implications behind weight-loss drugs and other areas of the market that could be impacted, such as the airline industry. However, Dave emphasizes once again that any mass changes are still years away due to supply constraints...

There's 100 million obese American adults. 100 million that need weekly injections. So that's only like 5.2 billion fully filled syringes a year. Oh, no problem! Just for the U.S. market. What kind of output is that, right? It's not software. You can't just do another download. You have to make 5.2 billion vials.

If you're interested in gaining access to Dave's research in Venture Technology, including a brand-new weight-loss-drug pick he's recommending this week, click here for more information on how to get started.