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America's $4 trillion health care industry is getting a high-tech makeover. ROBO Global Senior Analyst Nina Deka shares several of the most lucrative opportunities for investors.
October 12, 2021 – By Simon Erickson
America’s health care bill may cost us $4 trillion a year. But at least we’re getting more efficient.
Technological advances are improving several of health care’s most serious issues. Oncology diagnostics are now able to detect earlier-stage cancers before patients even begin showing symptoms. Remote monitoring is taking vital signs of the elderly without them ever needing to step into a hospital. The COVID vaccine is renewing our focus on mRNA, genomic sequencing is unlocking personalized treatments, and spatial biology is quickly capturing the full attention of the medical community.
But due to heavy regulations and the specialized nature of the work, isn’t the health care industry also notoriously slow to embrace innovation? Will these exciting new technology improvements actually pay off for forward-thinking investors?
To help us answer those questions, we’ve brought in a health care expert. Nina Deka is a senior analyst for ROBO Global, where she contributes to the firm’s health care technology index that carries the ticker “HTEC”. Nina has spent her career either working in or covering the health care industry, and she is well-versed in the ways of how technology can improve it.
In an exclusive interview, Nina spoke with 7investing CEO Simon Erickson about several of health care’s most important developing trends and the specific companies that investors might consider as opportunities.
Publicly-traded companies mentioned in this interview include Akoya Biosciences, Exact Sciences, Illumina, Invitae, Moderna, Pacific Biosciences of California, Teladoc, and Vocera Communications. 7investing’s advisors or its guests may have positions in the companies mentioned.
01:02 – Genomic sequencing at the 10,000-foot level
05:34 – Should investors consider investing in Illumina or one of their smaller competitors?
09:42 – The transition to consumer-facing diagnostics
13:15 – Teladoc vs Big Tech
20:34 – Nina’s thoughts on Moderna
24:03 – $HTEC’s modified equal weighting and the companies in the ETF
29:19 – What companies should investors have on their radar in this space?
Simon Erickson 0:03
Hello everyone and welcome to today’s edition of our 7investing podcast. I’m 7investing founder and CEO Simon Erickson. In America, healthcare is a $4 trillion market. But technology is finding ways to make it more affordable and more effective and I’m really excited to be joined today by Nina Deka. Nina is a senior analyst at ROBO Global. She is actually managing the company’s healthcare ETF which has the ticker $HTEC Hey, Nina, thanks for joining me on the 7investing podcast.
Nina Deka 0:32
Hey Simon thanks for having me.
Simon Erickson 0:35
There’s a lot to talk about in healthcare, we can bring this in a bunch of different ways we can talk about COVID vaccines, we can talk about health care, we can talk about your ETF. But I think that one of the things that I’m most interested in, in the healthcare space is this continual move towards personalized healthcare and personalized medicines. And of course, right at the foundation of that is genomic sequencing is something that’s catching your radar Nina, how do you think about genomic sequencing and kind of the 10,000 foot level?
Nina Deka 1:02
Oh I mean, this is this is where it’s at. This is a very hot space right now. In fact, Illumina (NASDAQ: ILMN) made the decision to acquire Grail to go further from its next gen sequencing capabilities, but branch out into a new area that is liquid biopsy. And they expect this to be a $75 billion market opportunity by 2035.
Simon Erickson 1:27
That’s a huge opportunity for sure liquid biopsy is of course, looking for earlier stage detection of cancer, we’re spending more than 100 billion dollars a year on the fight against cancer. It’s number one killer globally, number two in the United States, but it’s mentioned it’s interesting, you mentioned Illumina reacquiring Grail, because that’s actually a group that it spun off five years ago, why is Illumina so interested in reacquiring glaze Grail Is it because of that opportunity to talk about liquid biopsies?
Nina Deka 1:52
Absolutely. So if you think about a lot of cancer today, the testing is done where you have a biopsy, and and you surgically remove part of a tumor through the biopsy process, and then you can analyze this tumor tissue. And by doing so, you can you can find out that genetic composition of the cancer itself. And as you mentioned, precision medicine, there are pharma companies working in partnership with diagnostics companies to analyze these tissue specimens and figure out exactly the right kind of medicine that will treat the DNA of that specific cancer.
So that’s not going anywhere, that’s a huge opportunity and in and of itself. But when we talk about liquid biopsy, this is removing a specimen from the patient that is liquid, and most often blood. So if you think about when you go to the doctor for a routine exam, and they do a blood draw, with that routine blood draw, they can draw a vial, and submit that blood to a lab and analyze it and actually look for cancer cells.
So the idea is that if you have a cancer tumor, that it will shed cells, free floating cells into your bloodstream, and that by doing a blood test, you might be able to find these free floating DNA of the of the cancer and analyze that. And then and the thing is, you might not even know yet that you have cancer, you might not even have a tumor through which to conduct a biopsy. So by just doing a routine blood draw, you’re already at the doctor, you might be able to screen ahead of time and say, Hey, you know why the physician could say you know what, you have a patient, you might have a family history of certain type of cancer, why don’t we do a screen just to see if there might be some free floating DNA of this cancer in your system.
And so Illumina estimates that 100,000 lives can be saved annually by detecting cancer sooner. And you mentioned that the global costs, there’s an estimated global impact of over a trillion dollars of cancer. And so by earlier detection, you can actually hope to treat and cure cancers when you can detect it sooner.
So huge opportunity, and it’s not just Illumina going after this market. Last year in $HTEC, you mentioned our ETF in the $HTEC underlying portfolio, there was over $10 billion of m&a of these diagnostic genomics companies going after this market. Invitae (NYSE: NVTA) made an acquisition, for example, of Archer and exact sciences made another there are so many companies going after this space that nobody wants to be left behind because it’s such a massive opportunity.
Simon Erickson 4:49
It certainly is and it’s definitely exciting. I remember when you mentioned that you can detect earlier stage cancer stage one, stage two instead of stage three, stage four. That’s obviously a real big win for patients and the healthcare system as a whole Illumina’s paying $8 billion for Grail to kind of reacquire this group that it spun off.
And we’ve seen some progress with gallery now that liquid biopsy that you mentioned, that can detect circulating tumor DNA in the bloodstream. We’re seeing that now it’s a laboratory developed test. It doesn’t have full FDA approval yet, but it seems like it’s making a lot of progress. really an exciting time. Do you have thoughts about Illumina or as an investor companies in this space? Illumina has been kind of the top dog for several years. Are you looking to stick with a company like that? Or do you see that just so much innovation from the smaller players?
Nina Deka 5:34
Both say, yes to both. So the beauty of having an ETF, if you will, is that as an investor, you don’t just have to pick one player or find that the top players, we actually seek to figure out who the number one number two market leaders are that number one, number two technology leaders are across the different areas in which they operate, and then put them into a basket of companies. And from there, the kind of the legwork has already done.
So you mentioned Gallery. Gallery is in particular, quite special because a lot of the companies that are on the market now that offer these circulating tumor DNA type tests are only analyzing one type of cancer, whereas gallery has a panel that’s looking for up to 50 different cancers. And in fact, they just announced a partnership with with New York City to do to utilize this product if the doctor writes a prescription for cancer screening. So we’re just starting to really see it enter the market. And the beauty of a global market leader like Illumina is that they already have a wide footprint, they already have the brand and they already have the scalability.
So now, Grail will be able to leverage that scale and that market presence around the world faster than if Grail had done this on its own. For Illumina, they get exposure to the liquid biopsy fast growing space that we’ve already discussed. So that’s a really neat combination. But when you talk about some of the smaller players, there are less known players in the genomics world. Akoya (NASDAQ: AKYA), for example, is a new, a new inclusion into the $HTEC ETF. This is a company that focuses on spatial biology. So if you think about like, GPS navigation, where you’ve got, let’s say you’re looking at a map. So without spatial biology, basically the map is just there’s the streets, and the trees and the houses. With spatial biology science layered on top of that, you’ve actually got the names of the streets, the locations of all the houses and the addresses.
So it gives you that additional level of detail that you wouldn’t have otherwise had insight to. And with that detail, you can go to a pharmaceutical company and form a partnership and say, hey, look, we just figured out that it’s not just this DNA that’s causing this type of cancer, but there’s three other genes that we have found that are all kind of working together, why don’t you come up with this therapy that’s very personalized, and very precise. And and, and really target that cancer in a way that that you weren’t before.
So this is basically the next NGS the next next generation sequencing, if you will, of the market is spatial biology. And, and one of the things that where we’re seeing spatial biology today is largely in research. A lot of scientists, a lot of universities are doing research on this are taking a lot of funding, learning a lot of things where we’re not seeing it a lot right now is in the clinical setting. Where an actual oncologist can take this information and say, okay, based on this, we need this drug, we need this treatment protocol. And so we’re really excited about Akoya because they are very well positioned to branch this from the research world into the clinical setting. And that’s going to be a huge market opportunity.
Simon Erickson 9:07
Sounds very exciting. Nina, I wanted to double click on something you’d mentioned earlier about diagnostics, kind of going more consumer facing now. We’re used to kind of getting a diagnostic I got into hospital. But now you mentioned Exact Sciences (NASDAQ: EXAS). That’s a diagnostic you can do from home. You mentioned Invitae who is really interested in kind of getting people more in control of their own health.
How do you see diagnostics transitioning these next couple of years? Is it going to go more and more to the consumer and say empower yourself to go learn about your health and detect these things earlier on? Or is this still staying mostly behind the hospital and these are kind of tangential to what that’s doing?
Nina Deka 9:43
We are seeing a huge opportunity where companies are increasingly becoming more consumer focused. Just we’re calling it the consumerization of healthcare. In the old world or maybe even today’s world for most people. You go to the A doctor, the doctor writes a referral and you go see a specialist, you you get your blood drawn, it goes to a lab, etc. But now that people have access to more information on the internet, more information on their smartphone, that they can actually shop for medical services, the way that they shop for retail clothing, and you can pick based on quality and based on reviews where you want to go to get different services done.
And so now that the consumer is more engaged in their own healthcare needs, they’re becoming more aware, and they are to your point participating more like, via the ability to to have them collect their own stool sample, if you will, for exact sciences and send that in, to have to have their colorectal cancer cancer screening done, versus a colonoscopy. And in many cases, you’ll still need to do a colonoscopy. But this is a nice way to screen without having to come in and take that liquid solution the night before, that people have to do for the for the colonoscopy.
So yes, there, there are ways that that technology is making things more convenient, and more accessible to consumers. There are other examples like in virtual care, for example, you’ve got a company like Teladoc (NYSE: TDOC) that made one of the largest digital health acquisitions ever by acquiring Livongo last year. So this is a really cool company that helps patients monitor their chronic illnesses like diabetes, hypertension, etc. So again, we’re talking about consumers at home, somebody with diabetes is already managing it at home on their own.
But with Livongo, they basically have a handheld device that acts as like a coach, it will actually call them up and say, Hey, we just saw that your last blood glucose reading is out of range. Did you do something different for breakfast today? Why don’t you go for a walk? Or worst case scenario that the nurse calls the patient directly and says, Hey, we need you to come into the emergency room, because this level is not okay. So this is another opportunity for consumers to really get involved in their own health care. And, and if you think about what’s driving this, for the longest time, we probably spend about eight minutes a year in front of a doctor, provided you’re not sick, provided you don’t have a chronic illness.
But if you are healthy, and you just go in once a year for your wellness visit. That’s that’s not a lot of time in front of the physician. But when you increasingly involve the consumer in the decision making and allow them to participate, they can do things at home, like the colorectal cancer screen, like a COVID test that you can take at home now, or manage their diabetes, and stay in touch with the physician throughout the year to help them manage these illnesses and keep them from getting to the point where they wind up in the hospital. So this is a huge theme right now is consumerization. But also managing wellness, helping people stay healthy before they get sick, so that we can reduce these, the over $1 trillion costs in cancer and all the other costs associated with other chronic illnesses.
Simon Erickson 13:15
Yeah, it certainly is more consumer friendly, like you said, is a lot better selectivity and sensitivity. So those tests are getting better and better as they continue to develop them. I’m glad that you brought up Teladoc and the acquisition of livongo. Ci because that’s getting a telehealth closer and closer to the patient, as you can monitor a lot of things from home now rather than having to go to the hospital. Virtual health is something that the big tech companies are also very interested in. You know, we’ve seen Google now actually even partnering up with certain hospital and health networks out there. And then of course, Apple has got a zillion healthcare devices that it’s trying to continue to expand to consumers as well. Do you believe that a company like Teladoc can hold its own as big tech is going after healthcare as its next large horizon?
Nina Deka 13:59
Without a doubt, we are we’re still very bullish on this name. And I know that people thought that telehealth was, was the place to invest last year because of the pandemic and people were staying at home and having doctor patient visits. But now that people are going back to see the doctor in person, that seems to have been hype among a lot of investors. But what the market is missing is that Teladoc has spent the last decade building an underlying infrastructure that is going to enable virtual care. And we expect virtual care to underlie every facet of healthcare over the next 5 to 10 years. And teladoc is very well positioned for this theme.
And what I mean by this is it’s not just the doctor patient visit, but we’re talking about the underlying infrastructure that enables doctor to doctor communication, doctor to patient, doctor to families, patient to device, device to patient, device to doctor, device to device.You need a very sophisticated underlying infrastructure to make all of this work.
And Teladoc is very well positioned for that not only through their acquisition of livongo, that basically has them in the pocket and managing roughly around the care of people with chronic illnesses. But they have another acquisition of in Touch, which which really brought them a lot of the hospital market share to help hospitals build this underlying infrastructure. So we’ve got this growing theme of virtual care that Tella doc has going for it. But what what people are also missing is that the company in the second quarter of this year, their visit volume, that doctor patient visit was up 28% year over year, second quarter of 2020 was the height of the pandemic. So the fact that teladoc has not only met last year’s patient doctor visits, but exceeded them by 28% is indicative that telehealth is not only here to stay, but there’s still a lot of room for growth.
And where is that growth coming from? Well, one huge area, ROBO Global estimates that the addressable market for behavioral health doctor patient visits is at least 20 billion. And so if you think about like, the traditional telehealth visit where I have, let’s say, a sinus infection, and so rather than going to see a doctor in person, I can get one on the phone, that’s like a one off visit for someone who’s probably otherwise pretty healthy. But if you think about mental health visits, that’s like an average of nine to 12 visits or more in a month.
And so if you look at the number of visits that take place for something like mental health, or say a chronic illness, person with diabetes might see a physician up to six times a year. So when you see that now you’re having repeat visits, you can see the growth opportunity. And so the pandemic not only raised awareness for what a doctor patient visit is, but it got everyone used to the idea of we can do other visits, remotely through video so why not do more. So So Tella doc is well positioned for that theme for behavioral health for chronic illnesses in a very fast growing market.
So we expect this company to continue growth for years to come. And I will say that they’re, they one of the ways that they make money is a per member per month subscription fee. And, and we estimate that the core of that, that that core business prescription fee is subscription fee is already up like 60% over last year. So even the the number of products that customers are buying from Teladoc is growing, even if they sign up, no new customers are no new members, within their customer footprint, they still have a lot of opportunity to cross sell and grow.
Simon Erickson 17:46
Big win for the health care networks and for the patients, right, being able to detect things earlier and earlier and keeping people out of the hospital. So they had to be quite so reactive. We’ve seen kind of wearables evolve and improve over several years now. And you know, I mean, Fitbit was kind of one of the first ones that can monitor your heart rate. And we’ve kind of have gone on to see improvements in glucose monitoring for diabetics. Blood Pressure Monitoring, you know, is do you think that behavioral health is kind of a next incremental win that we’re seeing in virtual health and monitoring?
Nina Deka 18:15
And that’s that that is a huge opportunity. Like I said, we estimate at least a $20 billion market opportunity. But there’s other to your point with the with the wearable devices, there are other companies doing things that maybe we don’t a lot of consumers might not know about, because it’s happening behind the scenes.
For example, there’s a company called Vocera, that has a badge that is about this big, it’s a wearable device, they can wear it on their clothing. And it’s antimicrobial, and it’s hands free, and you can literally talk to it in a normal voice and say, call the nurse in charge of such and such patient in the ICU. And during the pandemic, this company got extra attention because with this hands free device, let’s say you were at the patient bedside. Recall during the pandemic, we had a shortage of PPE the gloves, the isolation gown.
So somebody would put this expensive, highly coveted scarce equipment on and then they would go in and talk to a patient. Let’s say a nurse had done that. And then the nurse wanted to contact the doctor. To leave that room, take off all the PPE, go find a doctor, come back, put on new PPE and then go back and talk to the patient. That was a really tough thing to do. And in general, pandemic aside, that’s, that’s a lot of equipment, that’s a lot of clothing changes and that there’s a cost associated with that.
With the hands free device. They got to keep all of the gloves on and all of the gowns, and then just just say, hey, Doctor, I’m in with a patient now what do you think we should do in this scenario, and enabling that level of communication is just one example of what Vocera does. They also allow a doctor from the comfort of their own home, let’s say that they get home at the end of the night, they’re getting ready for bed, they can take out their tablet, and and look up a patient and see real time what the patient’s stats are, they can see an ECG reading real time. And so this is a way once again, of virtual care being present so that people can continue to conduct healthcare real time without being necessarily the patient bedside.
Simon Erickson 20:34
I’d like to shift gears a little bit and talk about a company that I’ve seen you speak about quite a bit, which is Moderna (NASDAQ: MRNA). We talk a lot about mRNA, especially for the COVID vaccine. But you think that Moderna has got a pretty solid looking pipeline, and it’s actually automated a lot of its drug discovery efforts. What can you tell me about Moderna? And do you like this company as an investment?
Nina Deka 20:55
Oh, absolutely. So as I mentioned, for our portfolio, we look for market leaders and technology leaders and Moderna checks that box. This company, essentially over the last decade, built a platform through which it can make not just one but many mRNA therapeutics. And, and so it’s what the company has done in terms of AI, and an automation and it’s state of the art technology over the last decade that enabled it to come up with this COVID vaccine so quickly.
Before that was ever even in the pipeline, they had over 20 other therapies in, in the clinic. And, and some were advancing, in fact, even last year, while Moderna was working so hard to come up with a COVID vaccine and bring it to market, they were also able to progress another vaccine that they’ve been working on – CMV. And this is this is a virus that can lead to complications, if let’s say a mother is infected with it, and pregnant and has the baby, the baby could wind up with complications, one of the worst of which is blindness, and other issues.
But they were also working on RSV. This is a respiratory illness that infects women, in fact, hospitalizes over 50,000 children under age five annually. So now that the world has seen that mRNA can work, and that that it is now in the arms of millions of people around the world, gosh, more than that. It is something that we’ve seen with other therapeutic modalities that once you see one, make it, it kind of de risks all of the other similar modalities that are also in in the clinical trials.
So it’s not just my Moderna, but other mRNA companies that that people are excited about Now, why we’re excited about Moderna in particular is because like I mentioned, they had that rich pipeline. And you’ll see a lot of biotech companies that that are working on one or two drugs through partnerships. But Moderna invested very heavily in building its own scalable platform, so that even if it was just one drug that came to market, they’ve got many others that they can continue to leverage their platform to also bring to market fairly quickly.
So this is a really exciting time to be investing in that company and in that space. And aside from vaccines, they have the capability to go after cancer or drugs. So there’s there’s a lot that can happen for decades to come in the mRNA world.
Simon Erickson 23:40
I’ve got two more questions for you, Nina. The first is I wanted to drill down a little bit more into your your healthcare technology index, the ETF that you have a ticker again on that is $HTEC. As you mentioned earlier, you’re looking for the market leadership out there. And you have an $HTEC score, which is a modified equal weighting, but it’s based on revenue purity, and market and technology leadership. Can you explain to me what that means and the kinds of companies that you’re looking for?
Nina Deka 24:03
Sure. So what we did was we started with, well, our flagship ETF is ROBO been around for almost eight years now. But what we saw over the first five years of that, that the ETF, which is focused on robotics, automation and AI, is that there was so much happening in healthcare that it warranted its own strategy. So we launched $HTEC in June of 2019. And and what we’re looking at is across the the areas of healthcare where we believe there are the most unmet needs.
So there are rising costs, there are rapidly growing populations of the elderly. People over the age of 85 are expected to double in the next 30 years, and we’ve got a shrinking workforce of skilled healthcare workers. Half of the nurses today are over the age of 50 and going to be retiring. And so what we have is not enough people to care for the growing number of people that are going to need the care. I mentioned medical error earlier third leading cause of death in the US.
Imagine more people who need care or not enough workers, that medical error number is going to go up. So what this is a screening for automation, AI, digitization of healthcare, a lot of healthcare is still analog. And so, so what we do is we look across what are the most innovative areas in the healthcare industry. And we have determined nine different sub sectors including precision medicine, genomics, diagnostics, telehealth, robotics, process automation, what and so we believe these nine different areas are, are going to represent the disruptive, the most disruptive technology over the next decade and all the growth.
And so among them, we then drill down further and say, okay, who were the leaders in cardiology, in telehealth, in genomics, spatial biology, if you will, and, and then we, we take each company, we conduct fundamental analysis, we do the legwork, we meet with the management, and then we apply a score. And this score is based on our fundamental analytics, as well as some some fundamental screens, debt to EBITDA ratio, EV to sales ratios for valuation, and and based on this is how we determine in a huge universe of cool companies with a lot of great technology, which ones are truly the leaders, we wind up with a basket of about 80 to 90 companies, and we try to keep it around that size.
And what that does is it brings investors exposure to some of this great technology that I just shared with you where we’re doing the legwork behind the scenes. And and then and then you as the investor don’t have to wonder down the road, like is this the right time to get involved with a company like Madonna, or, or is teladoc, something I should still be interested in, because it’s something that we’re keeping a very close eye on, and always keeping up to date.
In fact, we refresh the portfolio, every quarter, we do a rebalance. So all the companies that had a run during the quarter get a little shift, a little trim, if you will, and the companies that didn’t have as good of a quarter, we add to position. So in fact, we’re always selling high and buying low. And then at the time of that quarterly rebalance, if we have a new company that we want to add, like I mentioned Akoya earlier, that would be the opportunity to do so.
We’ve got a very extensive vetting process, a committee that meets, voting, we’ve got advisors who are the technological who’s who around the world, that kind of weigh in and also share their opinions and the senior, the research analysts put their heads together. And this is how we come up with this portfolio. And the performance is actually not bad. I’ll mention that as well. If you were to look at the companies in the $HTEC portfolio, over the last three year period, they returned, let’s say around 28%, over that three year period, and that’s compared to a comparable global healthcare index that’s just all healthcare. So it includes some of the some of the areas that we don’t spend as much time on like health insurance companies, large pharma. So if you were to look at that type of portfolio that’s returned about 15% in the last three years, so so nearly doubling the performance of other comparable level healthcare indices.
Simon Erickson 28:40
Makes a lot of sense. Bet on the leaders in the most innovative sectors.
Nina Deka 28:44
That’s what we do.
Simon Erickson 28:45
My very last question is kind of similar to the last one, you did such a good job of answering that one. That is probably a perfect segue. But what are a few specific things that people who are interested in investing in innovation or disruption in health care should be watching, you know, we mentioned Illumina kind of the beginning of this interview, we’ve seen the cost of a whole genome sequence just falling incredibly quickly in the last few years, by selectivity and sensitivity of those diagnostic tests. Those are just kind of two examples. But are there a couple other things that specifically you’re looking at, that we should probably have on our radar for anyone who wants to invest in this space?
Nina Deka 29:19
Yeah, I would continue to keep an eye on areas like surgical robotics, for example. We’ve seen a lot of market gain in general surgical robotics, focusing sort of on that abdominal area. And there are other opportunities in surgical robotics for growth, not just in other parts of the body like orthopedics but also applying back to what I said about virtual care.
Telerobotic surgery is something cool that’s that’s just starting to break ground. There have been more than a handful of examples around the world where a surgical procedure was allowed to take place remotely. In India, a cardiologist was able to conduct a procedure using Corindus, something a company that was acquired by Siemens healthineers a couple years ago. This procedure was conducted 20 miles away.
And the broader implications of that are that there are people around the world that might need access to a certain surgical procedure that just can’t get to a big city to have this procedure done, or, or the nearest hospital in the rural part of the world that they live in. So as we see advances in 5G and network capability, and further innovation happening in surgical robotics, that’s something to keep an eye on. I would also keep an eye on the pharmacy area, there’s another place where robotics can start to automate things that humans are doing like something like putting pills in bottles.
So if you could automate some of those, those things that pharmacists are doing, then it really frees up time to let them operate at the top of their license and actually work directly with the patient and, and look at their medication regimen and make sure that they’re taking the safest drugs if the safest time of day. And then there’s other cool things happening like in the therapeutic area, there’s a new modality of therapy called NK – natural killer. And this this holds the promise of being something that could disrupt the CAR T therapeutics.
Because CAR T therapies cost hundreds of thousands of dollars to make and administer. And you basically, it involves taking a specimen out of the patient, sending it off, and then creating the therapy using that patient’s original specimen, shipping it back administering the drug and then and then the patient has to be monitored because there’s a lot of side effects. But with NK therapy, there are much fewer side effects. We’re starting to see early data. And there was a company called Fate (NASDAQ: FATE) that’s pioneering this. This is another new inclusion in the $HTEC portfolio.
And so Fate’s got some really exciting things happening and you can manufacture the therapeutic using NK for around $2,000. So it costs less to make you can scale it more easily and it might cause less side effects for the patient. Overall. If they can prove that it can do exactly what CAR T does, and maybe better, then there’s a huge opportunity for that line of therapy. So really exciting. We still expect CAR T to have a place obviously, it already works and it works very well in the cases where it is treating patients and curing their cancer. But this could be another option.
Simon Erickson 32:49
Well this has been fantastic. There’s so much exciting stuff going on in healthcare right now once again Nina Deka, Senior Analyst at ROBO global helping to manage the $HTEC Healthcare Technology ETF that they have you know this has been really enjoyable. Thanks for joining us on the seven investing podcast.
Nina Deka 33:04
Yeah, thanks so much for having me, Simon. Take care.
Simon Erickson 33:06
And thanks everyone for tuning into this episode. We are here to empower you to invest in your future. We are 7investing.
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