My Top 10 Ideas As Of End of July 2024
Disclaimer: Not investment advice. Do your own research. For informational purposes only. I reserve the right to change positions after publishing as events change.
This Substack is still in a holding pattern but I am committed to my once-monthly positions update so let’s get right into it!
Top 10 Holdings, By Position Size
Position sizes accurate as of market close 7/31/2024.
Perspective Therapeutics (CATX)
Corbus (CRBP)
Evolus (EOLS)
Cullinan (CGEM)
Celcuity (CELC)
Nurix (NRIX)
Edgewise Therapeutics (EWTX)
Larimar Therapeutics (LRMR)
Fulcrum Therapeutics (FULC)
Elevation Oncology (ELEV)
Updates and Changes
Very, very little turnover over the last month which makes me happy.
On CATX I am still expecting two datasets by the end of the year which will start to build proof-of-concept and safety data for two separate indications.
CRBP has been extremely strong lately heading into Novo’s CB1 targeted obesity data which should be a direct readthrough to CRBP’s program. These are the only two CB1 targeted small molecule programs around meaning CRBP is the only unencumbered asset in this space if the Novo data is encouraging.
EOLS had extremely positive earnings and growth reported just now after the bell. If the after hours price holds it will actually become my #1 holding tomorrow AM. Extremely impressive management and 2025 should be even more exciting with the launch of a filler line that will utilize the existing sales force. Should trade at 5x/sales in my opinion. They are outgrowing the overall neurotoxin market by 4x (36% YoY growth vs. ~9% growth of the overall market).
CGEM is awaiting IND clearance and other news in the autoimmune CD19 space which will be an indirect readthrough to their CD19xCD3 T-cell engager. First company generated data in 2025 likely. Still not that far above cash per share, even with its recent 20% rise.
CELC has a make or break binary approaching. Still thinking about how to manage position size and risk heading into it but I’m still pretty positive on the reward/risk ratio as I think it could be a huge long-term winner if the Phase 3 data hits. I have seen a few bear theses on CELC but none that have shaken me of my conviction yet. I think the future in HR+/HER2- 2L advanced breast cancer will be a combination of CELC’s drug along with ARVN’s drug and a CDK4/6 inhibitor. It deserves another long write-up but I haven’t found the time.
NRIX has had no news since their extremely strong PoC data in the early summer and I just continue to sit and hold it. Unfortunately one of the few names here with no near-term catalysts but maybe there will be a data update before the end of the year. 2025 should be busier and I think this is an acquisition target at any time. I’m very happy with my cost basis and I expect this to be a core Top 10 position still going forward until acquired.
EWTX has had a slight slump recently as there have been some jitters about the upcoming oHCM dataset in cardiology. I can’t say I have any insight on what the data will be as they have disclosed very little about the program but my cost basis is under $10 and I still am super bullish on the Becker Muscular Dystrophy program so I’m staying at status quo position size wise. If the stock were to have a large fall I might even consider doubling down. I like the BMD program quite a bit - the recent exercise challenge data matched the open label data and the only piece of the puzzle left is placebo controlled data showing statistical significance in CK with numerical improvement in NSAA. If that is the case there is a real chance at accelerated approval and the market will price in a much higher chance of success for the Phase 3 pivotal which should be fully enrolled soon. This could be a rare disease blockbuster as the only approval for 12,000 patients with a high unmet need. And much further upside if it works in Duchenne Muscular Dystrophy.
LRMR is one of two companies that is new in the rankings this month I believe. They have a drug candidate in Friedrich’s Ataxia. FA now has one approval in the space but it is not a particularly strong drug and it has got out to a fast launch in spite of a lack of overwhelming efficacy. I think there is plenty of room for a new drug with a new modality and better efficacy plus the agency is still showing lots of regulatory flexibility despite a full approval in this space. Safety is more unclear than efficacy at this point for LRMR so each month that goes by with no bad news and more affirmation from the FDA (recently: removal of partial clinical hold and inclusion in the FDA’s START program) is good news for investors. This could literally be approved in the next 2 to 3 years and it treats the underlying cause of the disease. I still need to do more work about what outcomes data could look like or how much CNS benefit there is to be gained here but the bar in FA is pretty low and LRMR has a differentiated asset if they can thread the narrow therapeutic index window in regards to drug accumulation.
FULC is something I have written about so much - whether it be this Substack, my book from 2022, etc. I took advantage of a little recent weakness to re-add it to my Top 10. It’s an extremely risky binary but as of now the stock is working for me again and I’ll have to debate what I want my exposure to be before the readout in October.
ELEV will have data in August and the stock is just hated, hated, hated lately. I expect the data to be in line with expectations and a nice PoC for efficacy and more importantly safety going forward. Safety and the ability to dose higher might actually be the differentiator here, especially in a market that will increasingly be combination therapy for gastric cancer. The company did a good job raising money with the stock chart looked like euphoria now comes the 2-3 year process of execution. I believe the market is larger and less crowded than most people think but only time will elucidate that. I was hoping there would be more euphoria to come this year but I am resigned to thinking this will take time but I still hold it as my 10th largest position in case I’m too cynical. The modality is decently de-risked although I suppose their site-specific conjugation could lead to reduced efficacy compared to competition. We will learn more in August.
Deletions from Top 10
On PODD stock I sold due to how intertwined the company is with Dexcom, a company I have had recent issues with and that recently saw a -40% stock fall. More importantly (for me), my son’s CGM sensors from Dexcom have had some reliability issues that make me trust Dexcom’s products less. That is not Insulet’s fault but unfortunately they only support sensors from Dexcom right now and not the Libre 3 from Abbott. I will see how the rollout of integration with Dexcom’s G7 goes with Insulet’s Omnipod 5. I think 2025 could still be a monster year for PODD but right now there is a little risk. I chose to sell before earnings.
For ALXO the company handled the lead up to the disclosure of gastric cancer data in what I view as a very sketchy way. I know accusing executives or a company of malfeasance in writing is dangerous and can open myself up to liability so I will simply say: I want nothing to do with this company anymore and sold all my shares before data. Luckily the drug does not appear to be too active so it doesn’t look like I’m missing much. A slight miss for me on forecasting trial outcomes but I avoided a more painful loss. CD47-targeted drugs are on their last legs and looking extremely shaky but I’ll still follow STTK because their drug is also a CD40 agonist which may or may not make a difference. I expect that stock to get extremely “cheap” compared to cash before placebo controlled data in late 2025. I wouldn’t rush in though.
That’s it!
Matt