Andy Acker, Portfolio Manager on the Global Life Sciences Team, seeks companies that are pioneering life-changing innovations. Here, he discusses the cutting-edge developments being made in the medical field by some of these companies.
Throughout his 23 years of working in the financial industry, Andy Acker has been analysing the healthcare sector, first as an equity analyst and now as portfolio manager of the Janus Henderson Global Life Sciences Fund. Nowadays, he and a team of five analysts attend medical conferences, scour scientific research and use proprietary statistical models to seek out companies with life-changing innovations.
This Swiss pharmaceutical firm has one of the most diverse drug pipelines among its peers, and the company’s significant R&D investments should help it to counter generic competition. By the end of 2020, Novartis is expected to have 10 new launches, many of which have already entered the market or delivered positive, late-stage clinical trial results. One such drug, approved in the US in May, was a revolutionary gene therapy for spinal muscular atrophy, the leading genetic cause of infant death. We believe the market underestimates the potential of some of Novartis’ drugs. We also like that Novartis’ revenues are well diversified, with 15 blockbuster drugs (each greater than $1 billion in revenues), more than any other pharmaceutical company.
Neurocrine is one of our favourite mid-size biotechs, as we believe the company’s lead drug, Ingrezza, addresses a major clinical need for patients suffering from tardive dyskinesia, an involuntary movement disorder that impacts more than half a million US patients. The drug is off to a strong start, with sales already annualising more than $500 million in earnings, less than two years into its launch. A second drug, Orilissa, is partnered with AbbVie and addresses endometriosis and uterine fibroids, both large markets in women’s health (Neurocrine receives a substantial royalty on these sales). Finally, the company has a range of other pipeline assets in neurology and endocrine diseases, which we think should help to sustain long-term growth.
IQVIA is a data, analytics and clinical research outsourcing company created by the merger of IMS Health and Quintiles in 2016. IQVIA is benefiting from the surge of R&D taking place in biopharma. The company has also been able to leverage its combined resources to create new offerings. For example, using IMS Health’s more than 600 million patient records, IQVIA is providing start-to-finish solutions that improve clinical trial productivity and accelerate 'time to trial' enrollment. Consequently, in 2018, IQVIA gained market share, and the company recently raised long-term guidance. We believe IQVIA’s competitive advantages provide a strong platform to drive further market share gains.