Dear Reader,
Good morning!
Today, I want to talk about something I’ve been researching here at Behind the Markets…
A massive opportunity unfolding in the biotech sector as we speak.
The headline here is the conditions are ripe for a massive opportunity in biotech.
===Need your Immediate Response===
We just closed our Immunogen position for a 463% gain…
Right after closing out half our Altimmune position for a 205% gain…
Well, today I have some great news:
We are about to release our next top biotech pick.
Add your name to the distribution list here.
===
We have a biotech service, Biotech Insider, and we’ve (obviously) been feeling some pain since RFK Jr. was nominated and the biotech sector’s been down as a result…
Money’s just been coming out of the biotech sector.
Now, we have a great long-term track record in biotech; 48% average gains on all closed trades, winners and losers, since we started this service in 2018, and every year we’ve hit that number.
We’ve gotten whacked in the past few months – no mistake about it – but that’s created a really special opportunity.
Let me explain why:
Prices in the biotech sector are cheap, by any measure of value you want to use.
It’s really one of the cheapest sectors in the stock market.
As we talk about often here, everything else is just ridiculously overvalued.
But here’s what makes this opportunity unique in history…
We are on the verge of a major patent cliff coming right now.
Between now and 2033, patents on dozens of brand-name medications will expire…
Allowing generic drugmakers to begin selling generic and cheaper versions of these drugs.
I took some notes here on how big this patent cliff is going to be…
Drug companies stand to lose more than $400 billion in revenue in the next 10 years as patents expire for Keytruda, Eliquis, Jardiance, OPDIVO and other blockbuster therapies.
Eight companies stand to lose billions in the next five years alone.
Just look at these numbers:
In 2025, Novartis is expected to lose $6 billion from expiring patents…
Roche, 4.3 billion.
Bristol Myers, $2 billion.
In 2026, Bristol Myers is expected to lose another $14 billion from drugs coming off patent…
Merck, $4 billion.
In 2027, Roche is projected to lose $8 billion worth of patent protection.
In 2028, Merck is expected to lose $43 billion when Keytruda expires…
Johnson & Johnson, $17 billion.
The list goes on and on.
So, if you’re the executive of a big pharma company, you’re saying to yourself:
“OMG, there is a cliff coming… we’re going to lose a third, or half of our revenue…
“What do we do in the future?
“How can we take care of this?
“How do we survive?”
There’s a playbook for this.
A very established playbook with two basic moves…
1. Cut costs.
2. Boost revenue.
Experienced CEOs know when revenues come down, you cut your costs as quickly as you can to match percentage-wise your revenue.
For example, if your employee headcount is 20% of your cost structure at $50 billion in revenue…
You make sure that when your revenue goes down to $25 billion your employee headcount stays 20% of revenue.
You’ve got to cut costs – that’s just the way the game is supposed to be played.
But if your move is #2, boosting revenue, that can lead to some of the greatest deals of the next few years…
Because then you have Big Pharma looking to acquire small biotech companies.
If you’re looking at losing half your revenue in the near future, you are looking at small biotech companies and saying, “gosh, which one can best help us plug this hole?”
And right now, they’re scouring, looking around.
Think of it like a high school dance.
All these little biotechs are the best-looking girls at the dance, and all these Big Pharma guys are circling around trying to find a dance partner.
That’s going to likely lead to a merger explosion like we haven’t seen since 2018, 2019, right after we launched the service.
At that time, we personally recommended four companies that all got bought out within months of each other.
It was wild.
It got so crazy, I remember recommending a company on a Friday and it was taken over Monday.
We sold for a 71% gain after a single weekend.
Imagine buying a stock Friday, and Monday morning you go to your computer and see it's up 71%.
One subscriber, Scott, from California wrote in to say,
"Fastest $19,275 I have ever made in my life. You recommended Loxo Friday morning and it was taken over Monday. Wow."
It was one of those times where deals were just popping.
And that is the opportunity I see coming right now.
We actually just sent our top 3 stocks to Biotech Insiders – you can get access to them here.
We are already in a lot of these small companies ripe for takeovers.
A lot of them are in oncology.
Certainly, when you think of Keytruda’s patent expiring, you’re looking for oncology drugs.
We’re in companies everyone is going to want before that expires.
If you’re a Biotech Insider member you know exactly what I’m talking about.
We’re also looking at specialty drugs for autoimmune and other diseases.
The bottom line is this:
There are massive opportunities in biotech.
Probably the biggest we’ve seen since the last time a massive patent cliff like this happened, which was 2011 when about $250 billion worth of drugs were coming off patent.
What’s really special about right now is that big pharma is flush with over a trillion dollars to spend on takeovers.
I’m taking this from STAT News:
Johnson has $123 billion…
Novo has $104 billion…
Merck, $102 billion…
Eli Lilly has $87 billion; Roche has $84 billion; Novartis, $65 billion; AstraZeneca, $54 billion.
These guys have a lot of firepower.
So we have big pharma looking at a $400 billion patent cliff coming…
They know they’ve gotta buy – they’ve gotta plug these holes.
They need new revenue, new drugs to sell...
And they have a lot of cash.
And biotech stocks are cheap right now.
This is going to make for a very exciting opportunity for us.
Go here to learn more about Biotech Insider and get our top 3 picks for 2025 now.
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