Orphan-drug developers unlikely to leave investors feeling abandoned, says
Turner Investments commentary
Investment firm’s health-care analysts believe companies developing drugs for
rare diseases offer a profitable pharmaceutical niche
BERWYN, Pa. -- August 1, 2013
Less can be more: pharmaceutical companies developing so-called “orphan”
drugs, or treatments for rare diseases with 100,000 or fewer patients, can
enjoy a highly profitable niche in the industry, according to the latest
Sector Focus commentary from Turner Investments.
Titled Adopting orphan drugs can be highly profitable, the piece was written
by the five Turner analysts who cover the health-care sector: Heather
McMeekin, portfolio manager/global equity analyst; Vijay Shankaran, senior
portfolio manager/global equity analyst; Frank Sustersic, senior portfolio
manager/global equity analyst; Theresa Tran, global equity analyst, and
Michael Tung, global equity analyst. Turner Investments, based in Berwyn,
Pennsylvania, publishes Sector Focus commentaries monthly as part of the
continuing efforts of its five teams of security analysts to monitor market
sectors for its growth-stock portfolios.
According to the analysts, “Because orphan drugs have substantial treatment
impact – they’re often much stronger than other drugs – hundreds or thousands
of new patients tend to emerge when they learn of the drugs’ beneficial
effects,” thus increasing the initial patient base. And as patients live
longer as a result of the drugs, demand for the drugs grows even more.
What’s more, federal incentives for companies to develop orphan drugs, like
tax incentives and exclusive marketing rights, provide developers with
considerable pricing power. In turn, that can provide investors with a return
on investment 1.7 times greater than that of non-orphan drugs, according to
The analysts believe Aegerion Pharmaceuticals, Alexion Pharmaceuticals, NPS
Pharmaceuticals, and ViroPharma appear to be well positioned to benefit from
the growth of orphan drugs.
To read this July 2013 Sector Focus in its entirety, click on this link to the
Turner Investments Web site: www.turnerinvestments.com/health-care. Or call
484.329.2407 for a free copy of the piece.
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Turner Investments, founded in 1990, is an investment firm based in Berwyn,
Pennsylvania. As of June 30, 2013, we managed more than $8 billion in growth,
global/international, and long/short investment portfolios in stocks to both
institutions and individuals.
As of June 30, 2013, Turner held in client accounts 246,170 shares of Aegerion
Pharmaceuticals, 198,714 shares of Alexion Pharmaceuticals, 3.1 million shares
of NPS Pharmaceuticals, and 883,973 shares of ViroPharma.
Abbi Anderson, 484-329-2407
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