Investments

More Microbiome Secrets

A new revolution is about to start - get in on the ground floor! Well, it’s been a few months since the last posting on the huge unmet clinical need for microbiome analytics. And the market map still looks roughly the same. The genomic revolution has been happening for 15+ years. Nowadays, genomics is prevalent in almost all major areas of biological science. However, we are still in the early days of the microbiome revolution.

A Secret About Drug Development

People watching pharma companies and the drug development process (this includes investors/VCs, academia and the general public) from the outside will seldom think about this unmet need. The Problem If you’re a scientist, you don’t participate in the upside but you participate a lot in the downside in the case a drug fails to make it past trials and onto the market.. This isn’t exactly a secret (see interview: Vivek Ramaswamy, Roivant Sciences CEO), but is something casual biology enthusiasts or scientists in academia may not appreciate.

A Secret About Drug Development

People watching pharma companies and the drug development process (this includes investors/VCs, academia and the general public) from the outside will seldom think about this unmet need. The Problem If you’re a scientist, you don’t participate in the upside but you participate a lot in the downside in the case a drug fails to make it past trials and onto the market.. This isn’t exactly a secret (see interview: Vivek Ramaswamy, Roivant Sciences CEO), but is something casual biology enthusiasts or scientists in academia may not appreciate.

Short Roku

Roku (NASDAQ: ROKU) Date written: Feb 15, 2018 Current price: $45 Price target: $20-25 (45-55% gain) Time frame: 6-12 months Recommendation What: SHORT with price target of $20/share (50% to gain). Time frame: 6-18 months. Why: Overly ambitious user growth estimates Inferior hardware product Limited potential for company to cut costs Catalysts: Potential earnings miss (2/21/18) Missed earnings will cause a sell-off IPO lockup period ends March 2018 => stock price will drop Series B converted shares will get sold off => stock price will drop Risks:

A secret on microbiome startups

In the first year of medical school (2012), a professor told us about fecal transplants. The entire class laughed, simultaneously dismissing the idea and making inappropriate jokes. Fast forward a few years, fecal transplants are being performed more, and patients’ microbiomes are being sequenced. Research has linked the human gut microbiome to diseases such as systemic lupus erythematosis (clinical trial). The interest in the microbiome is exploding. Meanwhile, genomics interest has decreased rapidly since the GWAS bubble, and stayed relatively constant.

Still long on Gilead (GILD): $120 PT

Price target: $120 Time frame: 1-2 years A year after my original call (http://https://rchenmit.github.io/2016/08/13/gilead-one-mans-sickness-is-another-mans-profit/), I am still long GILD. The positive drivers clearly outweigh the overblown fears. Positive Drivers: the recent Kite Pharma acquisition Gilead will continue to print money with non-alcoholic steatohepatitis (NASH) drugs Overblown Fears: “the hepatitis C (HCV) revenues are decreasing!” “the HCV patents are expiring!” The overblown fears should be non-issues.

AI Investment Thesis 2017

Overall investment thesis to bet on: research (R&D) - heavy businesses teams with strong domain expertise going after unique use cases where AI plays a critical role in solving them But really, theres potential for all flavors of startups: Algorithm developers: new algorithms are typically very short-lived. If you serach ArXiv, hundreds of papers describing new techniques are published daily. That being said, there are various examples of successess, including DeepMind and Whetlab.

Long on Equifax (EFX): $150 PT

Price target: $150 Time frame: 12-18 months The sentiment has turned. Buy equifax (NYSE: EFX) stock now. The data breach was a minor f***-up, but sent shares tumbling from the 140s to the 90s. How about that. The bull case for Equifax can be described from 3 angles: strong market economics strong business strong management Business This may be obvious by now, but it’s clear that in this day and age, data is money.