00:00Yeah, I mean, it's definitely an interesting time to be buying into the vaccine space, given sort of the political
00:05climate that we have in the U.S. with Health Secretary Robert F. Kennedy Jr., who has, you know, pulled
00:11funding from various vaccines who and we've sort of lost seen a loss of public support for vaccines.
00:17But that has not stopped Lilly. I mean, Lilly has been on a tear recently with M&A. The company
00:22has a lot of cash on hand, thanks to the popularity of its blockbuster obesity and diabetes medications.
00:29And what it's looking to do now is to build toward that next era of growth.
00:33What happens after these medications that are fueling its growth right now lose patent protection, as they always do in
00:39the pharmaceutical industry.
00:40And so vaccines are going to be, at least it appears to be, part of Lilly's sort of next era.
00:46They hired former FDA official Peter Marks last year to lead their infectious disease unit.
00:52And then this is their first real foray into that space.
00:56So there are three different companies, as you saw, that they are buying as of today to target various different
01:03global health crises from antimicrobial resistance to Epstein-Barr virus and others.
01:09So it will be pretty interesting to see what happens here.
01:12Shingles as well.
01:13Exactly.
01:14That might go up against, I guess, the leader in that space is the, is it called?
01:18Shingrix.
01:18Shingrix.
01:19Yeah, yeah, yeah.
01:20The Shingrix vaccine.
01:21So do we know more about this deal?
01:23I mean, I know the three companies that they're buying are privately held.
01:28But do we know anything else about these deals?
01:30Because usually with these kinds of things, there are milestones as you, I guess, I don't know, set sales goals
01:35or what have you.
01:36Yeah, yeah, exactly.
01:37And that is a part of this.
01:38There are going to be milestone payments.
01:41These various companies, I mean, based sort of all over the world, a couple in the U.S., outside of
01:46the U.S.
01:47I think one is based in Zurich.
01:48And so they, you know, Lilly has a track record of going earlier in the, you know, drug development process.
01:56They like to go for these earlier stage, cheaper deals versus later on sort of bigger mergers.
02:03And that's, this is the sort of the same pattern that we're seeing here.
02:07A couple of them are in clinical development already.
02:10One of them is about to be ready for phase one trials.
02:13And so Lilly will be able to really partner with them and take them through that process, which is something
02:18that's often hard and expensive for biotechs to do on their own.
02:21So for these big pharma companies that are out there in the marketplace with these weight loss drugs, they're not
02:26standing still, are they?
02:27They're making them better, more powerful, less side effects.
02:30What's Lilly doing, for example?
02:31Lilly is basically doing everything.
02:33I mean, they have, their strategy in obesity is to throw everything that they have at this.
02:39They don't want to be left out of it.
02:40They don't want what happened to Novo Nordisk to happen to them.
02:44I mean, Novo has sort of been caught flat-footed just by how quickly this market has moved.
02:49And there are a lot of competitors and a lot of people, like you said, trying to develop better weight
02:53loss drugs, whether that's, you know, pill forms or less side effects or taken monthly.
02:59Novo's sort of struggling to figure out its next move and fill its pipeline.
03:03Lilly has, you know, strategically made the decision years ago to throw everything that they had at obesity.
03:10And so they are looking at different types of molecules, something called amylin, which is thought to maybe be a
03:16little bit gentler on the stomach,
03:18maybe not have the same GI effects that the current generation of weight loss drugs have.
03:23They're looking at less frequent dosing.
03:25They're looking, they just had a new pill approved.
03:28They are looking at drugs that are even more effective than the ones currently on the market.
03:32So it's pretty much like everything under the sun they want to be playing in.
03:36Hey, the next area they need to focus on, they being the pharmaceutical industry, baldness.
03:41Baldness.
03:42Oh, yeah.
03:42Huge opportunity there.
03:44That'll put the hair back on, you know, half the men out there.
03:46Who's looking at me?
03:47It's not that bad.
03:49I mean, is that something that they're talking about?
03:52Because that is the same areas as like obesity, weight loss.
03:56Exactly.
03:57So Lilly actually does have a drug for alopecia, which is a little bit different.
04:01But there is another company, and I'm blanking on the name, but I know the ticker is Maine,
04:05which is pretty creative, that has been getting some hype recently because they are developing
04:11supposedly better hair loss treatments.
04:13So that's one that I know people have been watching.
04:16But, you know, when you look at these stocks, like Eli Lilly has barely budged year to date.
04:20And you mentioned Novo Nordis sort of being held flat footed.
04:23Year to date, they're down almost 12%, which I mean, I guess I get that.
04:26But I would expect a more enthusiastic response to Eli Lilly, and for some reason, the stock's
04:31just not moving much.
04:32Yeah.
04:32I mean, I think that's because at this point, they've just grown so much.
04:37I mean, their valuation is enormous.
04:39They hit a trillion dollars.
04:41They were the first health care company to hit a trillion dollar valuation last year.
04:45And I think it's hard for investors to see much more right now.
04:50Like when you're at the very, very top.
04:52Like how they sort of talked, right?
04:53They've peaked.
04:54Right.
04:54Like what what is there to get excited about?
04:57Which, you know, there is a lot that Lilly is doing.
04:59But I think to get it up from the high, high, high point that it's at now, I mean, it
05:04has
05:04to be something pretty spectacular.
05:05So I think that right now investors are sort of just watching and waiting to see what happens.
05:10Like, are they eventually, you know, is there a mistake or a hiccup coming or are they going
05:15to be able to sustain this incredible growth?
05:17And so I think that that's sort of the moment we're in right now is like, OK, what are what
05:21are they going to do next?
05:22What's going to get investors excited about this company going forward?
05:25That's not to say that they're not already excited and doing, you know, doing super well
05:29now.
05:29But I think it's like, OK, sort of watching.
05:31Well, the bar, when you're doing well, the bar goes, it gets raised and it's hard to beat
05:35the high.
05:36And on a trailing, you know, on a trailing 52 week basis, Eli Lilly, Merck and Johnson & Johnson
05:43are each up 50 percent on a trailing 12 month basis.
05:46So so that's pretty darn good, so they've done pretty well.
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