Post #75: Mr Venn explains healthcare
A picture, it is often said, tells a thousand words. If so, then consider the below. Your author spent two hours of his Friday afternoon listening to Novo Nordisk’s presentation on research and development given at the American Diabetes Association’s Annual Conference (held virtually this year). Your author is no scientist and struggles to get excited about double-blind randomised trials, placebos and control groups. This picture, in his view, shows you all you need to know.
We should be thankful to the Nineteenth Century Cambridge mathematician John Venn for his work on set theory. What it allows is to take the complex and make it simple. The Venn diagram above highlights that there is a significant overlap between patients suffering from type-two (T2) diabetes, cardiovascular disease (CVD) and obesity. It therefore behoves drugs businesses to work on solutions which potentially address all three problems simultaneously.
The figures make for quite daunting reading: ~510m people live with cardiovascular disease, a number which is expected to increase to ~530m by 2030 (per GBI Research). Of these, ~18m die annually, an estimated 31% of all deaths globally (according to the World Health Organisation). Notably, 70% of diabetes patients die from atherosclerotic cardiovascular disease (where the arteries typically narrow and become clogged). Meanwhile, 40% of patients who are hospitalised for heart failure heave diabetes (data courtesy of Novo Nordisk). It gets worse. What the chart does not show is that a further 37m people globally suffer from non-alcoholic fatty liver disease (or NASH) – another co-morbidity, as such illnesses are known – which often results from obesity and/or diabetes. Just 0.1m are treated today (per Novo).
All this implies that there is a significant unmet need for new drug innovation.Novo described the current situation as one generally characterised by “clinical inertia.” Logically, businesses (including Novo) – need to raise the bar in terms of innovation. The good news – at least as far as your layperson author understood it – is that this is now occurring. Notwithstanding the disruption COVID-19 has wrought to all sectors, clinical trials for new products which simultaneously seek to address some of the above needs continue apace. New drugs should also hit the market in the coming years. And, importantly, the businesses which operate in this critical sector remain committed to investing in further research.
The document is provided for information purposes only and does not constitute investment advice or any recommendation to buy, or sell or otherwise transact in any investments. The document is not intended to be construed as investment research. The contents of this document are based upon sources of information which Heptagon Capital LLP believes to be reliable. However, except to the extent required by applicable law or regulations, no guarantee, warranty or representation (express or implied) is given as to the accuracy or completeness of this document or its contents and, Heptagon Capital LLP, its affiliate companies and its members, officers, employees, agents and advisors do not accept any liability or responsibility in respect of the information or any views expressed herein. Opinions expressed whether in general or in both on the performance of individual investments and in a wider economic context represent the views of the contributor at the time of preparation. Where this document provides forward-looking statements which are based on relevant reports, current opinions, expectations and projections, actual results could differ materially from those anticipated in such statements. All opinions and estimates included in the document are subject to change without notice and Heptagon Capital LLP is under no obligation to update or revise information contained in the document. Furthermore, Heptagon Capital LLP disclaims any liability for any loss, damage, costs or expenses (including direct, indirect, special and consequential) howsoever arising which any person may suffer or incur as a result of viewing or utilising any information included in this document.
The document is protected by copyright. The use of any trademarks and logos displayed in the document without Heptagon Capital LLP’s prior written consent is strictly prohibited. Information in the document must not be published or redistributed without Heptagon Capital LLP’s prior written consent.
Heptagon Capital LLP, 63 Brook Street, Mayfair, London W1K 4HS
tel +44 20 7070 1800
email [email protected]
Partnership No: OC307355 Registered in England and Wales Authorised & Regulated by the Financial Conduct Authority
Heptagon Capital Limited is licenced to conduct investment services by the Malta Financial Services Authority.
GET THE UPDATES
Sign up to our monthly email newsletter for the latest fund updates, webcasts and insights.