Saturday, September 21, 2013

Maureen Dowd, "America’s Billionaire": Buy What You Know, or, Buy What You Don't Know (After Learning It)?

Unlike Warren Buffett, I don't give stock market advice. Moreover, I long ago reached the conclusion that I will not invest in companies where I do not interact with management. In addition, it's my belief that if a product being created by a company is too easily understood by me, it's ultimately going to be copied in China.

In her latest New York Times op-ed entitled "America’s Billionaire" (http://www.nytimes.com/2013/09/22/opinion/sunday/dowd-americas-billionaire.html?_r=0), Maureen Dowd describes a discussion between Bank of America CEO Brian Moynihan and Warren Buffett, which took place before an audience of 700 Georgetown students and faculty. Dowd writes:

"Speaking to an excited crowd of students and others Thursday night beneath soaring stained-glass windows, the 83-year-old Warren Buffett offered inspiring lessons in patriotism and compassion — traits sorely missing here as Republicans ran headlong toward a global economic cataclysm and gutted the food stamp program.

'I am sorry I’m late,' Nancy Pelosi murmured sardonically, as she arrived at the Buffett event. 'We were busy taking food out of the mouths of babies.'"

Don't get me wrong: I oppose Republican efforts to shut down the US government unless Obamacare is defunded. I also oppose "gutting" the food stamp program. But Pelosi demeaning someone else's morality? It was Pelosi who met with Syrian tyrant Bashar al-Assad in 2007 and infamously declared, "We came in friendship, hope, and determined that the road to Damascus is a road to peace." Some six years later, this past August 21st, Assad killed nearly 1,500 people with sarin gas, of whom more than 400 were children.

But back to Buffett. Dowd tells us:

"He doesn’t worry about keeping up with modern technology. He buys what he knows, like Coca-Cola, which he drank all evening."

Well, I'm not about to drink Coca-Cola all evening. Thank you, Coca-Cola won't dissolve your teeth overnight, but I'm not obese - nor do I intend to become so. Diet Cola? I prefer to feed my caffeine addiction with coffee.

But more to the point, is it all about making money? Or does the possibility also exist to make money by investing in endeavors, which, unlike Coca-Cola, can contribute to humanity?

But how to invest in biotech or medical devices without losing your shirt? Not easy. But for me it begins with my desire to be overwhelmed by the science. When I meet with a company's scientists, I want to feel that I am the dumbest person in the room.

Late in the second half of the game, I am blessed to be able to work with two remarkable companies seeking to change the world in which we live.

Compugen, which is revolutionizing the manner in which new drugs and diagnostics are discovered, has spent the past decade building an infrastructure of proprietary scientific understandings, predictive platforms, algorithms, and machine learning systems for the in silico (by computer) prediction and selection of product candidates. Although Compugen is the vision of Martin Gerstel, who in the past guided Alza, a drug delivery company, to success, the ongoing realization of Mr. Gerstel's dream is in the hands of some 50 geniuses who have collectively integrated their diverse fields of knowledge - no small endeavor. I meet and talk regularly with Mr. Gerstel and Compugen's management and scientific team. Although I am overwhelmed by their intellects, I have never encountered arrogance or condescension. Quite the contrary: I have always experienced smiles and angelic patience as their scientists have explained to me their latest achievements.

A month ago, Compugen announced that it had signed a licensing deal with Bayer HealthCare involving two immune checkpoint regulators discovered by Compugen. Immune checkpoint regulators? Cancer immunotherapy? As explained by Compugen in their press release describing the deal (http://cgen.com/press-releases/212-compugen-announces-collaboration-and-license-agreement-with-bayer-for-antibody-based-cancer-immunotherapies):

"The immunotherapy approach aims at combatting cancer by stimulating the body´s own immune cells. The tumor and its environment suppress the ability of cancer patients to develop an effective anti-tumor immune response and in this way protect both tumor growth and survival.

. . . .

Latest cancer immunotherapies have demonstrated impressive clinical benefit, even for end-stage patients with difficult-to-treat tumors such as metastatic melanoma and non-small cell lung cancer. Unlike conventional cancer therapies, which act by directly targeting the cancer cells, resulting often in only transient clinical responses as cancer cells become resistant, clinical responses to cancer immunotherapy tend to be durable, sometimes resulting in dramatic long term survival and absence of resistance or recurrences."

Exciting science? You bet! And last week, Compugen announced experimental results for yet another immune checkpoint protein that it discovered, CGEN-15049 (see: http://jgcaesarea.blogspot.co.il/2013/09/compugen-target-for-cancer.html):

CGEN-15049 has demonstrated the ability to regulate an impressive array of different types of immune cells, therefore offering unique potential as a target for monoclonal antibody immunotherapy for many types of cancers and further contributing to the diversity of Compugen's Pipeline Program candidates. More specifically, in vitro studies have shown that CGEN-15049 both inhibits Natural Killer cells, which are important for innate immune responses, and modulates the activity of types of T cells that constitute a crucial component of the adaptive anti-tumor immune response. In this respect, CGEN-15049 inhibits cytotoxic T lymphocytes, which normally act to recognize and kill tumor cells, and promotes inducible regulatory T cells, which play a central role in creating the immunosuppressive tumor microenvironment that reduce the ability of the immune system to fight the tumor.

In addition to its functional effect on multiple types of immune cells, CGEN-15049 is also expressed on a wide variety of cancers with high clinical unmet need, such as lung, ovarian, breast, colorectal, gastric, prostate and liver cancers. Notably, its expression can be detected both within the tumor epithelium of the cancers as well as on immune cells infiltrating these cancers. This expression pattern within the tumor microenvironment, combined with its immunomodulatory activity on immune cells involved in tumor progression, suggest a role for CGEN-15049 in suppressing anti-tumor immune response. Therefore, inhibition of CGEN-15049 activity by monoclonal antibody therapy, in certain cancer types, is predicted to result in allowing the activation of an anti-tumor immune response and potentially eliminating the tumor itself.”

Hard to understand? Yes, but worth making the effort. Where might you even begin to learn about immune checkpoint therapy for cancer? "Monoclonal Antibodies (mAbs) for Dummies," of course (see: http://jgcaesarea.blogspot.co.il/2009/10/monoclonal-antibodies-mabs-for-dummies.html).

Nano Retina, which is the brainchild of renowned medical device inventor Yossi Gross and nanotechnology icon Jim Von Ehr, is seeking to create a miniaturized retinal implant to restore vision to persons blinded by age-related macular degeneration and retinitis pigmentosa following a 30-minute minimally invasive operation. A video is worth a thousand words? Have a look for yourselves:



Again, I have only known kindness and caring from the founders and small team of scientists responsible for this breakthrough project.

Innovation is premised upon vision, ambition, teamwork and no small amount of sweat and lack of sleep. Temerity, rapacity and insensitivity are unnecessary ingredients.

So, do you buy what you know, or, do you buy what you don't know (after learning it)?

[As noted in prior blog entries, I am a Compugen shareholder, this blog entry is not a recommendation to buy or sell Compugen shares, and in September 2009 I began work as a part-time external consultant to Compugen. The opinions expressed herein are mine and are based on publicly available information. This blog entry has not been authorized, approved or reviewed prior to posting by Compugen.]

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