I’ve been saying for a while that scientific progress is moving so fast that most people are unable to deal with the kinds of breakthroughs that are happening.

I’m even astonished.

I didn’t think we’d see some of the developments that have come to pass in the past months for many, many years.

Transformational breakthroughs have taken place across the scientific spectrum. But the most remarkable and important are in medical biotechs.

Many of the breakthroughs I’m talking about will have a direct and dramatic impact on your healthy life span, or your “health span,” as well as your portfolio. One breakthrough that stands out is a nutraceutical that contains anatabine citrate, a naturally occurring food substance found in solanaceous plants. It directly addresses auto[innate]immune disorders associated with chronic low-level inflammation.

“Game changer” may be an overused cliché, but this is really, truly that.

But before we get to what it is, here is why it is so important…

The name of the neural circuit that regulates the immune response to injury and invasion is the “inflammatory reflex.” Inflammation is a complex mechanism that involves the destruction of damaged cells. It heals salvageable cells and aids in the growth of entirely new cells.

When we are young, the primary role of this important biological response is to heal injury or infection. But inflammation also increases the rate of aging and leads to various pathologies.

Chronic inflammation increases as you age. Eventually, it creates a problem serious enough to trigger a cascade effect. Uncontrolled inflammation causes the simultaneous healing and destruction of cells.

This can lead to: cancers, heart attacks, lupus, IBS, macular degeneration, stroke, obesity, ED, allergies, psoriasis, Crohn’s disease, endometriosis, rheumatoid arthritis, hair loss, diseases of the organs such as the thyroid and liver as well as…

Well, you name it.

Today, scientists have advanced the science much further. Many are now using the term “inflammaging,” coined by Claudio Franceschi, professor of immunology at the University of Bologna.

It appears that our immune systems react to the normal effects of aging as if they were injuries. This initiates inflammation, an immune response. This inflammation causes cellular stress. It is, by definition, an auto- immune disorder. Some scientists call it auto[innate]immunity subclinical syndrome.

It is a vicious circle, a chronic cycle that spins faster and faster until the organism itself eventually fails. Aging, we now know, is not linear. Like so many other things, it is a process that accelerates over time.

However, if there were a way to stop chronic low-level inflammation we could put the breaks on the auto-immune inflammation cycle. If we could stop chronic low-level inflammation. Our bodies could heal naturally.

We would even see cells damaged by past inflammation-related diseases heal normally. We’re not talking about regenerative medicine.

Regenerative medicine promises to replace aged cells and tissue with young telomere-restored cells and tissue. An alternative route is the activation of the telomerase gene, which we know can restore telomeres to youthful lengths.

In the meantime, however, we need to slow the process of telomere loss. For some time, scientists have known that inflammation is the primary accelerator of telomere loss. This is why so few of us reach our theoretical maximum life spans – which could be 120 years or more.

We would be much, much more likely to reach that theoretical upper limit if we aged as we did when we were young. A drug that actually controlled inflammaging would restore the aging process to a more linear progression.

For this reason, many scientists are looking for the means to reduce or stop inflammaging. Not infrequently, this hypothetical drug has been referred to as the “holy grail” of drug discovery.

The market for such a compound would be so big it is nearly unimaginable. Lipitor, technically atorvastatin, does lower indicators of inflammation. The most well-known, because doctors can test for it easily, is C-reactive protein (CRP). CRP levels rise with inflammation and their reduction demonstrates lowered inflammation. As a result, Lipitor is known to reduce the danger of cardiovascular and other diseases for many people.

Measured by sales, Lipitor is the most successful drug in history. Last year, Pfizer sold over $5 billion of Lipitor. This is despite a broad range of adverse effects and competing anti-inflammatory statins. At its peak in 2006, Pfizer was earning almost $13 billion annually from Lipitor.

But the breakthrough nutraceutical I mentioned above is far more effective than Lipitor or the other statins while being safer and cheaper. That, my friends, is the holy grail of modern medicine so many scientists are seeking.

More unbelievable still, they’re saying it isn’t even a drug in the legal sense. The holy grail is an extremely safe nutraceutical – a food that all of us consume in small quantities regularly.

Regards,

Patrick Cox,
for The Daily Reckoning

The “Holy Grail” of Medicine originally appeared in the Daily Reckoning. The Daily Reckoning, published by Agora Financial provides over 400,000 global readers economic news, market analysis, and contrarian investment ideas.

In short, biotechnological innovation is certain to progress through good times and bad; through booms and busts.

Every day, breakthroughs are being made in understanding and re-engineering biological processes. For example, two of the companies I have recommended to the subscribers of Technology Profits Confidential are pioneering the use of monoclonal antibodies as targeting mechanisms for chemotherapy agents, also known as antibody-drug conjugates (ADC).

Antibodies are highly specific by nature. Without them, our own bodies would lack the means to defend against infectious organisms and cancers. Once the immune system recognizes a pathogen, it begins to produce the antibodies needed to flag it for attack by white blood cells.

Decades of research have given us the knowledge of how these natural-born killers work. Now we have the technology to build them to order.

There are, of course, blockbuster antibody-based cancer therapies already on the market, like Herceptin and Rituxan. However, these are “naked” antibodies. They do help kill cancer cells, but they must be used in conjunction with chemotherapy. They represent the “Phase I” of antibody therapeutic technology. They hit cancers hard enough to be useful therapies, but can’t deliver a knockout punch on their own.

Although the two companies I recommended take this concept one step further. They engineer antibodies that are customized to specific cancers. By adding a proprietary chemical bond to the antibody, a chemo-toxin can be attached.

The antibody gains entry once it attaches to the cancer cell. There, the cell’s own biological machinery breaks the bond linking the toxin and the antibody, setting the chemo molecule free to disrupt the cell and kill it.

These antibodies aren’t going into battle naked; they are armed and dangerous.

Both of the companies I recommended have many ADC candidates moving down the road toward FDA possible approval. In fact, one of the two companies may end up having the very first ADC on the market.

Although the initial indication for this compound would be to combat relapsed, resistant Hodgkin’s lymphoma and anaplastic large cell lymphoma (ALCL), other cancers have been found to express the same molecular target as Hodgkin’s and ALCL. Therefore, other potential targets for this treatment could include cutaneous T-cell lymphoma, peripheral T-cell lymphoma and B-cell lymphoma.

Another company I am following has also developed a very promising ADC compound to treat small cell lung cancer (SCLC), Merkel cell carcinoma, ovarian cancer, carcinoid and other neuroendocrine tumors.

In addition, this company is advancing armed antibodies in partnership with other pharmaceuticals for lymphoma, solid tumors, multiple myeloma and liquid tumors. Admittedly, these compounds are still a few years away from a final approval application.

But the technology is very solid…and very exciting. Biotech, broadly speaking, offers some of the very best investment opportunities available today.

Ad lucrum per scientia (toward wealth through science),

Ray Blanco
for The Daily Reckoning

Natural-born Killers…the Good Kind originally appeared in the Daily Reckoning. The Daily Reckoning, published by Agora Financial provides over 400,000 global readers economic news, market analysis, and contrarian investment ideas.

Moreover, DNA vaccines could be used against diseases other than their historical target: viruses. Early on, it dawned on researchers that this new generation of vaccines could be used to train the immune system to attack cancers and a wide range of other malignancies that act like foreign invaders inside the body.

Conventional vaccines work by causing the body’s immune system to recognize unique antigenic proteins that are part of the virus, triggering an immune response against the invader. The elegance of DNA vaccines is that, rather than introducing into the body an actual virus, only the antigen is introduced. Scientists realized that they could turn cells in the body into protein-manufacturing plants. By isolating the DNA responsible for producing ONLY the foreign antigenic protein associated with a specific virus, they could get around various issues associated with live or weakened viruses.

Big Pharma companies like Merck, Wyeth and GlaxoSmithKline, as well as national labs and academic research facilities poured billions into a “first wave” attempt at producing commercially viable DNA vaccines. Problems delivering the DNA vaccines in a way that provoked a sufficient immune response soon dampened their enthusiasm.

Two basic problems prevented the development of truly effective DNA vaccines. The first was an immature understanding of genetics. In those days, researchers were only beginning to learn how to optimize the DNA sequences to produce antigens with maximum impact. Additionally, there was the familiar “delivery” problem. Cells didn’t absorb enough of the DNA plasmids to become effective antigen factories. Since the amount of antigens produced by the body was therefore low, the immune response was insufficient to form the basis of viable drugs.

As a result, early DNA vaccine trials in humans were disappointing. The flow of research dollars slowed. Behind the scenes, however, determined scientists in dedicated startups never lost confidence in the core science. As importantly, alliances were formed and diverse discoveries merged. In recent years, their work has finally begun to bear fruit. I have been aware of this fact for some time. Until now, however, I hadn’t identified a company that fits in the Breakthrough Technology Alert portfolio.

But thanks to a series of mergers, a single company holds all the talent and IP needed to deliver on the breakthrough potential of DNA vaccine technology. In fact, the company appears to have solved the problems faced by early DNA vaccine researchers.

Patrick Cox
for The Daily Reckoning

“Next Generation” Vaccines originally appeared in the Daily Reckoning. The Daily Reckoning, published by Agora Financial provides over 400,000 global readers economic news, market analysis, and contrarian investment ideas.

In spite of the “deflation” that has much of the banking world spooked, brand-name drug prices increased 8.3% in 2009, says a study AARP released this morning. They’ve nearly doubled in the past five years.

AARP tracked the prices of the 217 drugs most commonly used by elderly Americans and found last year had the highest rate of inflation since at least 2006, when the Medicare drug benefit kicked in.

Coincidence? We think not.

Just in time, a federal judge in South Carolina put the kibosh on President Obama’s plan to allow federal funding for embryonic stem cell research.

“If one step or ‘piece of research’ of an embryonic stem cell research project results in the destruction of an embryo,” ordered South Carolina Judge Royce Lamberth, “the entire project is precluded from receiving federal funding.”

Judge Lamberth cited the ban on federal funding of embryonic destruction from the previous administration. (Thank goodness someone in the federal government is willing to stand up for moral rightness and correctitude.)

Fortunately, “the ruling will have little impact on private companies that have been living with the ban on the use of federal funding for unapproved embryonic stem cell lines for years,” says Patrick Cox, editor of Breakthrough Technology Alert and in whose wheelhouse this bit of the news cycle firmly resides.

“Primarily, the ban will effect academic institutions that accept federal research money, which counts for a very small fraction of the money that has gone into stem cell research.

“And ironically, the biggest impact will be felt by important universities. They’ll no longer be able to profit from collaborations that produce marketable technologies. Today, these collaboration incomes are a significant source of funding for many academic research labs. And ultimately, it will slow the progress of regenerative medicine.

“But assuming it stands, the ban will concentrate stem cell IP in private firms that are unaffected by the ruling,” which could be good for investors in the right companies.

Further, “the ruling,” Patrick continues with a recurring theme since the financial crisis began, “reduces the motive for leading stem cell companies to stay in the US. Stem cell companies want to collaborate with US researchers. If they cannot, they will probably look elsewhere.”

Already, one of Patrick’s leading stem cell research companies has launched an operation in China, because the regulatory environment there is in many ways more lenient.

“Whereas our FDA often acts to protect established pharma interests,” says Patrick, “Asian authorities are consciously attempting to establish new medical industries to compete with American companies and technologies.

“For investors, this is largely irrelevant, but for Americans it means that we will probably see the current trend toward offshore research and development continue. Luckily, investors are not restricted by national borders and can follow the science and profits wherever they find a friendly home.”

Patrick Cox
for The Daily Reckoning

Drugs Defy Deflation originally appeared in the Daily Reckoning. The Daily Reckoning, published by Agora Financial provides over 400,000 global readers economic news, market analysis, and contrarian investment ideas.

Remarkably, the same basic thing has happened again. This last week, three major scientific developments were announced regarding progress in the field of RNA interference. Once again, some of the companies involved are in our portfolio. (I will refer to them as “Company X” and “Company Z.”)

As I’ve said many times, we know that RNA interference is one of the most important areas of scientific inquiry. The reason is that the RNAi mechanism offers us a means of controlling individual genes. This, in turn, offers the theoretical means of curing nearly every disease suffered by humans, animals or plants.

Though scientists were aware of some of the actions involved in RNAi, it was one article published in the critically important journal Nature that put all the pieces together. That was in 1998, and the article was titled, “Potent and Specific Genetic Interference by Double-stranded RNA in Caenorhabditis Elegans.” In 2006, two of the authors, Craig Mello and Andrew Fire, were awarded the Nobel Prize for that critical work.

This article rocked the scientific world. Allow me to characterize the big picture that emerged from that article.

Basically, the master genetic program in our cells, DNA, never willingly exposes itself to any outside influence. Rather, it operates behind biological fire walls that protect it from viruses and other invaders. It communicates, however, via messenger molecules. These are called messenger RNA or mRNA. The mRNA molecules, in turns, “encode” or synthesize proteins that actually spread the DNA’s commands.

RNA interference, as the name implies, is a natural means of disrupting that process. Our cells use a complex, but fascinating mechanism called RNA-induced silencing complex (RISC) for all kinds of natural functions. It can be thought of as part of the immune system, as it protects from viral invaders, but it is also part of our gene regulation system. It can also, however, be manipulated to accomplish other ends.

I find it useful to think of this process, simplistically of course, as a kind of computer virus-protection program. Computer programs such as Symantec’s Norton AntiVirus and Trend Micro’s PC-cillin have large databases of “evil code.” They scan your computer, incoming data and external drives looking for code sequences that are in the database of evil code. If it finds evil code, the security program attempts to block it from interacting with your computer.

Anti-virus software periodically updates by downloading new additions to its database of evil code. In a sense, RNAi offers scientists a way to hack those evil code updates and inject their own code sequences. It could be exploited to send RNA sequences that would provoke the body to block the operation of particular encoded proteins.

For example, there is a protein code that enables the capillary growth that causes blindness through wet macular degeneration or tumor growth. Scientists know what code sequence to add to the evil code database that will stop excess capillary growth. Eventually, I believe, we will know what code blocks Parkinson’s disease, glaucoma, kidney disease, autism and on and on and on. By introducing the right small RNA molecules, we can provoke the body to disrupt the chain of communication that results in those conditions. It is even possible to increase the production of proteins that increase health or reverse damage.

Hopefully, cell biologists in the audience will forgive my crude metaphors. Regardless, when that Nature article was published, scientists began the quest to figure out just how to use RNAi to cure diseases. Universally, they encountered one enormous obstacle. These small RNA sequences are exceptionally fragile. Under normal conditions, they are quickly destroyed by the immune system.

This is not dissimilar, by the way, to security and virus protection software. The ultimate goal of the “black hat” hacker is to penetrate and exploit the anti-virus security programs themselves. If a hacker could hijack the process by which these get information about new threats, the database updates, he would “own” the computer and could do anything he wanted. Consequently, your anti-virus program has a level of safeguards built into it that far exceeds those of normal programs.

Because the RNAi mechanism performs similar functions, such as scanning and blocking unwanted actions, that biological system offers similar controls over the system. It is, therefore, not only scientists who want to exploit the system. It is logical target of sophisticated microorganisms that evolve constantly in an effort to hijack your immune system. As a result, we have particularly strong defenses against interfering with the RNAi process.

It is extremely difficult to get small therapeutic RNA sequences past the immune system into the right cells to cure diseases. Some scientists believed that it might be possible to deliver RNA interfering sequences locally, by injection into a tumor, for example. The problems associated with developing a systemic delivery system that could be taken orally or injected but that would then act only on target cells seemed almost insurmountable. In fact, many scientists believed it was impossible in higher life-forms, particularly humans.

Last week, we learned definitively that it is not impossible. In a major scientific journal, “Company X’s” scientists presented peer-reviewed proof that they have done it.

Simply put, the anti-cancer drug that Company X tested is valuable. More valuable, however, is Company X’s proprietary platform that produced the successful RNAi delivery solution. With this successful test of a systemic RNAi cancer drug in humans, Company X’s ability to deliver other interfering sequences to target molecules will be attracting serious attention from Big Pharma.

Every big pharmaceutical company has an ongoing RNAi delivery research program. Merck has admitted that it has tested hundreds of methods unsuccessfully. Company X, however, was the first to prove it could make a systemic RNAi drug for humans. I would be astonished if Company X does not sign some sort of agreement with Big Pharma within the year.

While Company X has clearly scored a major coup, it is by no means alone in the quest for RNAi delivery methods. In fact, “Company Z” announced a successful delivery mechanism last week as well. Company Z tests involved local surgical delivery into the skin of rats, but the results indicate that it has found a way to beat the delivery problem. I spoke with the CEO of Company Z. He is clearly confident that further tests will show the systemic effect of this technology in humans.

I think that the events of the week emphasize several crucial aspects of the field of RNA interference. One, obviously, is that progress is being made very rapidly. After I interviewed Craig Mello a year and a half ago, I told you this. Still, it’s difficult even for insiders to keep up. This is the result partly of the fact that progress in so many related fields, such as human genomics, continues to accelerate.

Another characteristic of this field is that it appears there will be multiple winners. The delivery mechanisms used by Company X and Company Z are quite different, but both have demonstrated efficacy. It remains to be seen which will be more effective for which diseases. Personally, I believe there will be multiple winners.

In fact, as I was writing this column, two more important news stories broke concerning our other RNAi companies. Therefore, to say that developments are breaking quickly in RNA interference is an understatement. It is extremely meaningful that all this action on the RNAi front seems to be coming from aggressive small caps, not bureaucratic Big Pharma. Nobody knows, at this point, how everything will shake out in the next few years. The rational investment strategy, therefore, is to own a portfolio of the most promising of these entrepreneurial companies.

It’s possible that all these RNAi innovators in our portfolio will do well simply because the promise of RNA interference is so incredible. As one unnamed biotech CEO recently told me, “We’re not going to run out of sick people to treat. There is, unfortunately, no disease shortage.”

We now know with certainty, because of the week’s events, that RNAi can be delivered effectively. There are still details to be worked out, but this is truly great news.

Patrick Cox,
for The Daily Reckoning

Huge RNAi Breakthroughs! originally appeared in the Daily Reckoning. The Daily Reckoning, published by Agora Financial provides over 400,000 global readers economic news, market analysis, and contrarian investment ideas.

I’ll explain the ISCO developments in some detail. A reader, by the way, recently suggested that I write the Stem Cells for Dummies book for those who are confused by this complex field. While this is not a book, it should help those of you who really want to understand the state of this critical science.

As a primer, it’s vital that you’re up to speed on the four different types of stem cells (SCs):

Adult Autologous SCs – SCs taken from donor bone marrow and fat tissue, cultured and re-administered to the donor for therapeutic purposes. These solve the immune and ethical problem but do not compare in power to the other three types, nor are they “young,” meaning maximum telomere length.

Embryonic SCs – These cells are taken from embryos and are therefore ethically objectionable to many people. They have efficacy and they are young but they provoke an immune response.

Induced Pluripotent SCs – These are SCs that are created by genetically engineering normal adult cells to revert to SC status. They have efficacy and they solve the immune problem because they are the donor’s own cells. Last week, BioTime proved that they can also be made “young.”

Parthenogenic SC – These SCs come from unfertilized oocytes, the cells that, if allowed to develop, would become ovum. They are, by definition, young. They have no ethical problems because they are not embryonic. They solve the immune problem through the creation of ISCO’s HLA typed cell bank. Last week, ISCO also announced evidence that they have efficacy.

Once you’ve got those covered it’s equally important to take a look at what each treatment is capable of…

The above chart, and corresponding announcements are simply fantastic news – notably for iPS and hPS. I updated you on BioTime’s breakthrough regarding iPS last week in a special alert – but soon after BioTime’s announcement there was another huge happening.

Today I want to catch you up on this important news…

Unlike BioTime’s breakthrough, which was covered by The Wall Street Journal, The New York Times and other big media, ISCO’s breakthrough announcement was, basically, ignored. The reasons are twofold.

First, ISCO may be the most insouciant, understated biotech in business today. Some companies are quick to trumpet their accomplishments. ISCO, on the other hand, is incredibly and systematically low-key in its public statements. Company announcements are often cautious to the point of secretiveness. I’m convinced that the company’s stock price would be much higher now if this were not the case.

Secondly, I admit the significance of last week’s announcement is particularly well obscured. Therefore, let me read between the lines of this press release.

On the surface, the press release is about the beginning of ISCO’s “Second Pre-Clinical Phase of Testing Retinal Pigment Epithelium (RPE) Derived From Human Parthenogenetic Stem Cells for Treatment of Retinal Diseases.” So why is this a big deal?

It is a big deal because of one sentence in the press release. “Encouraging data from animal models have shown that visual degradation caused by AMD can be slowed through the transplantation of RPE.”

In other words, ISCO has evidence that its nonembryonic parthenogenic RPE cells halt the advance of age-related macular degeneration. These cells prevent blindness just as RPE cells from cadavers and embryonic sources do. In essence, this is the same kind of breakthrough that BioTime just announced, but from a different angle.

Here’s how the story played out for BioTime…

Scientists have long known that embryonic stem cells have the ability to repair damaged tissues in animals. Scientists also knew that induced pluripotent stem (iPS) cells made from adult cells (not embryos) would have the same ability. This is important because iPS cells don’t come with the ethical problems that embryonic cells do. Moreover, because iPS cells can be made using the donors’ own cells, they would cause no immune system rejection problems if returned to the donor.

The rejection problem could likely be treated using immune system suppressants, just as is done in the case of organ transplants. Still, immune suppressants have many unwanted side effect. Donor iPS cells would clearly be a superior solution.

Scientists were excited because iPS cells offered the hope that youthful iPS cells could be created using a patient’s own cells. Then, you could have as many of your own rejuvenated cells as you needed to fix aged and damaged tissues, all without immune reaction.

The monkey wrench in this vision came when some scientists created iPS cells from donor cells. They found that the effective age of the new stem cells was the same as the donor cells. This was a big potential problem. They believed that iPS heart cells from a 65-year-old donor who had suffered a heart attack would be effectively 65 years old. There would be little point in transplanting old cells into a heart suffering from aging-related illness.

West, however, proved that he can reverse the clock of aging in iPS cells so that the 65-year-old woman with heart disease could use her own iPS cells that are as healthy as a newborn baby’s. This is huge.

Basically, ISCO scientists have just proven that they have the same ability vis-a-vis parthenogenic cells.

There has never been any question that hPS cells are young. This is because they are derived from unfertilized ovum, oocytes. Like iPS cells, hPS cells also solve the ethical problems associated with embryonic stem cells. They are not embryonic cells and, unlike iPS, probably can’t even be used to create human clones. Moreover, the parthenogenic technology has the promise of solving the rejection problem, as do iPS cells.

Parthenogenic stem cells have only half the DNA of normal cells. They are parthenotes, cells whose double helix of DNA has unzipped in preparation for the possibility of fertilization. ISCO has figured out how to use this feature to “hack” the immune system problem.

The reason is that immune rejection or acceptance is determined by human leukocyte antigen (HLA) matching. This is too complicated a subject to deal with sufficiently here, but you can think of it this way: Acceptance or rejection of a transplant organ or cell depends on the body’s reaction to a number of genetic “points,” or antigens in the transplanted tissue. With good matching of these points, little or no immune suppression is necessary. If most do not match, there will be massive rejection and even the most aggressive immune suppression may not work.

For simple mathematical reasons, the odds against comprehensive matching of HLA points increase geometrically with each additional point. Therefore, the difficulty of immune matching hPS cells, with half the DNA and HLA points of normal cells, is far, far less than half the difficulty of matching a normal cell.

In fact, it is possible that only 50 hPS cell lines will immune match 95% of the human race. Think of these 50 (or more) cell lines as complex versions of blood types. ISCO is in the process of building a cell bank of hPS cells that could solve the rejection problem, delivering the immune benefits of iPS cells, but from another angle. ISCO has several lines now that each immune match over 15 million Americans. Once gathered, these immortal cell lines never have to be regathered.

Even unmatched, by the way, hPS cells with half the HLA points are probably superior to normal embryonic cell therapies in the immune suppression department. Once this cell bank is constructed, however, ISCO expects to solve most of the same immune rejection problems that iPS cells solve. Additionally, as I’ve said, they are young cells like BioTime’s iPS cells. Only one piece of the puzzle was unverified.

We did not have proof until this last ISCO study was completed that hPSCs actually work. I believed they would. ISCO scientists, obviously, believed they would, but we didn’t have clinical evidence. It was an extrapolation of scientific principles.

When making projections, we always make these sorts of assumptions. If ISCO and I had been wrong, however, ISCO would be collapsing and its stock value near zero. And I would be… embarrassed, to put it mildly. So my thanks go to all the scientists at ISCO, especially Dr. Elena Revazova, who made the early parthenogenic breakthroughs in Russia.

Anyway, we now have clinical evidence that hPS cells work in animals, just as embryonic cells and iPS cells do. Increasingly, by the way, it has become obvious that embryonic stem cells are functionally obsolete in the field of regenerative medicine. There has been an unusual amount of resistance to this fact in the scientific press. I’m half-convinced, in fact, that a lot of journalists are still vested in discrediting President Bush’s insistence that a superior solution to embryonic stem cells could be found.

Embryonic stem cells work fine, of course, for actual human reproduction. I personally hope they never become obsolete there. iPS and hPS cells, however, are the superior platforms for most therapeutic uses.

The iPS platform may always be the most attractive high-end stem cell (SC) strategy, but ISCO’s hPS cell therapies will have important advantages in many cases. For instance, let’s say you have an accident and need SC treatment immediately for spinal cord or organ injuries. Unless you have already had your cells transformed into iPS cells and potentiated to become all the types you are likely to need in emergencies, your only real option would be hPS cell therapy.

ISCO’s platform will also have a cost advantage. ISCO’s ability to mass-produce and store off-the-shelf treatments, stem cells programmed to cure specific conditions without immune rejection, guarantees the company a huge market niche. Induced pluripotent SC technologies will likely keep the high-end clinical market, but hPS cells will likely be the Wal-Mart of SC therapies. While not as glamorous as the high end, Wal-Mart has made early investors rich. ISCO’s advantages should do the same thing.

For example, consider the RPE cells ISCO is bringing to market. These cells are based on 10 years of research, primarily at Advanced Cell Technology (OTCBB:ACTC). Ten years ago, age-related macular degeneration (AMD) looked like the perfect target for eSC therapies.

It is known that RPE cells from cadavers can stop or reverse AMD. The cost of gathering enough cadaver cells for one patient, however, runs from $10,000-15,000. Moreover, there are simply not enough cadaver cells for a fraction of the 2.5 million Americans with the disease. ACT estimates the worth of the market for replacement RPE at $2.5 billion. ISCO’s chairman Ken Aldrich, in keeping with his aforementioned restraint, says $1 billion.

Retinas, unlike corneas, are rich with capillaries. This means immune reaction is a particularly serious issue. When ISCO gets to market in two or three years, I project it should have most or all of the cell lines it needs to deal with immune rejection. Moreover, it has taken the technology a step further. Whereas ACT proposes therapy with RPE cells, ISCO is growing them in a matrix that can be applied surgically. My prediction is that these matrices will not only stop AMD, they will reverse it. If ISCO had a theme song, it would probably be Irving Berlin’s “Anything You Can Do.”

We’ll see, of course, but all that’s left to prove ISCO as a transformational stock for the ages is human trials. They could be completed in as little as two years.

Patrick Cox
for The Daily Reckoning

The Second Huge Stem Cell Breakthrough in a Week originally appeared in the Daily Reckoning. The Daily Reckoning, published by Agora Financial provides over 400,000 global readers economic news, market analysis, and contrarian investment ideas.

Obesity is a major risk factor in various diseases, from arthritis and cancer to diabetes, hypertension and heart disease. Any drug that can help people lose weight safely is, therefore, going to offer true value. Moreover, obesity increases with age. As the baby boom, the wealthiest generation in history, rolls into its senior years, the demand and the need for an obesity treatment is growing dramatically.

Until now, we haven’t chosen a company in this sector, for several reasons. One is simply that the field is crowded. There were a lot of companies and technologies to vet. Many people are working on fat drugs. Normally, this might have kept me out of the sector, but there’s room in this market for more than one winner. Buyers of these products often use them in combination.

Another reason we were particularly careful is that we’re going to see brand-new strategies for weight control in coming years. These new approaches, which I expect from several new sciences, including RNA interference, will probably leapfrog anything that comes out in the next year or so.

Nevertheless, the demand is so great and the FDA is so resistant to new technologies, I expect some serious profits from innovators over the next five years. More importantly, this company has the potential and platform to evolve into a major biotech success story with many other targeted therapies.

Cheers,

Patrick Cox
for The Daily Reckoning

Coming Investment Boom: Curing American Obesity originally appeared in the Daily Reckoning. The Daily Reckoning, published by Agora Financial provides over 400,000 global readers economic news, market analysis, and contrarian investment ideas.

You know that our bodies are incredibly complex. All throughout human history, we’ve fought to understand more about how our bodies work. For millennia, progress was slow. We made our breakthroughs in fits and starts.

Complex medical procedures – such as the groundbreaking heart surgery of 1944, was just the beginning. After that, vaccine technology took off with the development of the Polio vaccine in 1952. Soon thereafter, imaging technology began to allow doctors and scientists to take the next step and peer deeper into our bodies.

The trend continues today.

With the benefit of ultra-advanced microscopes and what’s called “molecularly precise” manufacturing, scientists are figuring out how to use our own cells to help repair vital organs like the heart. “Patients will receive injections containing… their own cells… extracted and multiplied,” BBC News explains, “[to] generate new tissue [and] repair damaged regions.”

So rather than relying on some outside treatment, the future of medicine will be in figuring out how to make your body heal itself and rejuvenate itself. No surgery. No invasive procedure of any kind. It’s this kind of promise that makes me believe 2010 will be the dawning of an amazing age of medical marvels.

Here’s another example: Vaccines that cure diseases AFTER infection.

The way doctors treat viruses now is fairly straightforward. If there’s a vaccine available, the doctor gives it to you ahead of time so you don’t get sick. In other words, getting the “cure” ahead of time is the only way to treat a virus.

This model works. Sometimes.

But new flu strains emerge all the time. These strains change, become stronger. So imagine the profit potential of a process that could kill the flu – or nearly any other virus – AFTER you contracted it. Now imagine this virus cure coming in the form of a simple skin patch.

You get the flu. You put on a patch the size of a band-aid. The flu goes away. Voila. It’s that simple. I am monitoring a company that is trying to develop just such a technology. It is one of my “6 Companies Ready to Change the World in 2010.”

Another company I’m monitoring is exploring a revolutionary process for repairing spinal cords. Their work could someday mean precisely this: If someone suffers a spinal cord injury and the paralysis that comes with it, this company’s technology could repair the spinal cord. Just like new.

“Cells from the nose may help spinal injury victims walk again,” Fox News explains. “It’s a relatively simple procedure to take them from the patient, grow more of them in the laboratory and then insert them back into the same person.”

This revolutionary little firm finally gained media and analyst awareness in 2009 due to its ongoing tests. And this company isn’t just interested in spinal repair – it has groundbreaking cancer treatments and life-extension research and tests currently underway as well. Their blueprint is simple: Save the life of the cell and you live longer…or at least better.

Lastly, imagine a simple, fast procedure that gives you a rebuilt heart functionally the same as the clean-beating heart of a 29-year-old person. That’s the full promise here. How big do you think this market could be?

Now here’s some background. In May, the CEO of the company that might offer these cures this year made an announcement about his work at an exclusive conference…

What did he announce? Cells he’s working on show the potential to re-grow cartilage. Just think for a second what that could mean for folks with arthritis. All that pain and suffering, simply going away. Now imagine the same technology applied to heart cells. That’s exactly what this researcher and his team are working on.

2010 will be, I predict, the year it all comes together.

The profits of the past 12 months that some folks have booked are nothing compared to what’s in store for the years ahead. Because it’s not just heart treatments and virus cures that could soon be available.

I’m talking about a Golden Age of Medical Marvels.

The Medical Miracles of 2010 originally appeared in the Daily Reckoning. The Daily Reckoning, published by Agora Financial provides over 400,000 global readers economic news, market analysis, and contrarian investment ideas.

Our DNA is, in effect, locked and protected in a cellular clean room without a door. DNA does, however, send out messages with the order to turn genes on or off. Those messages are RNA, or ribonucleic acid.

Therefore, the right RNA sequence can be introduced to the body to modify the behavior of virtually any gene. This is RNA interference (RNAi) and it provides the ability to control specific genes and the proteins these produce. Those proteins, in turn, are the key to most human diseases. The companies that own those therapies will, in turn, become the new pharm giants — or they will be acquired by existing pharma, delivering enormous profits to stockholders.

The challenge now is the delivery of RNAi drugs to cells. RNA is a large fragile molecule that doesn’t penetrate cellular membranes under normal circumstances. Also, the body tends to clear itself of RNAi drugs almost immediately, whether through the kidneys or inside the cell itself. Nuclease, which exists inside the cell, breaks down RNA. For this reason, intense research has been concentrating on carrier molecules that can transport the RNA as a payload.

There are several companies racing to bring the first RNAi therapies to the market. With such a transformational potential in the treatment of human disease, we’ve made it a priority to build a portfolio of the most important RNAi pure plays. Each has a different approach to solving the delivery problem.

As I’ve said before, we can’t know yet which will yield the big solutions. It may be that only one of these companies will break though… We know from a study of past transformational technologies, such as computer chips and software, that the best method of earning transformational profits is to buy a diversified portfolio of the best players and hold them for the long run. That’s what we’re doing in regard to RNAi.

Now is the Time to Invest in RNAi originally appeared in the Daily Reckoning. The Daily Reckoning, published by Agora Financial provides over 400,000 global readers economic news, market analysis, and contrarian investment ideas.