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Investing in the future of cancer treatment (BMY)

Frank Curzio, Stansberry Research
2 Comments| August 23, 2014

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The long-awaited revolution in the "War on Cancer" is here.

For the first time in 70 years, medical experts have found a new way to treat cancer – by using the amazing capabilities of our own immune systems.

Some of the world's biggest pharmaceutical companies are pouring tons of cash into this new treatment. And early results show it's making great strides in curing cancers – even those like melanoma, which were once believed to be incurable.

In short, it's one of the biggest early-stage trends shaping our world today. And it has the potential to generate big gains for early investors...

The official "War on Cancer" began with the National Cancer Act of 1971. Nearly half a century later, we've made very little progress in the most important battles...

The death rate hasn't changed significantly since the 1930s for cancers like breast, prostate, colorectal, liver, and pancreatic. By comparison, stroke and heart disease death rates fell 74% and 64%, respectively, between 1950 and 2006.

We can't deny that we've made some strides in the past four decades. By studying the causes, we've saved thousands, even millions of lives through prevention. We've developed new treatments. And we've even come to understand the genetic underpinnings of cancer. In many cases, however, all we can do is help cancer patients live a few months longer.

We put a man on the moon in less than a decade. And the World Wide Web went from fantasy to the most powerful network in history in just 25 years. Where was the revolution in the War on Cancer?

It hasn't arrived because cancer treatment has barely changed in the past several decades.

Since its discovery 70 years ago, chemotherapy has become one of two mainstays in cancer treatment. The second one is radiation, which has been around since x-rays were discovered in 1895.

These treatments (along with surgery to remove tumors) are still the go-to options for cancer patients.

And both have punishing side effects. Patients often experience uncontrollable vomiting, hair and tooth loss, heart and lung damage, memory loss, and infertility. They may even develop a secondary cancer.

Let me be clear: I'm not against these treatments. Without question, they help extend lives – including my dad's. He passed away from lung cancer 10 years ago.

The problem is they don't discriminate between tumors and healthy tissue. They just destroy. What we need is a way to target cancer... a treatment option that identifies and kills the bad cells while leaving the healthy cells intact. But how close are we?

The long-awaited revolution is closer than most people realize.

It's called immunotherapy. This new treatment trains the immune system to attack tumors.

You see, the human immune system is more powerful and sophisticated than anything medicine has ever produced. Think of it as the body's army. It's made up of several different cell types, each with its own purpose.

For example, one type of cell "patrols" the body looking for unwelcome invaders and threats. Another type "combats" them. These cells fight to protect your health every single day. When you catch a cold, your own immune system makes you better.

But cancer is one of the rare diseases that "trick" the immune system.

Tumors flourish because the body doesn't initially recognize them as invaders or threats. And when the body does recognize them, it attacks for a while and then gives up. It decides the battle is not worth fighting.

Immunotherapy is finding powerful ways to overcome these obstacles. It has finally made it possible to leverage the amazing capabilities of our own immune systems to fight cancer.

Some of the treatments use drugs to send messages directly to your immune system. One message describes the threat to the cells so they can identify it. Another message tells them to attack the tumor and to keep looking for it even when it's gone so it doesn't come back. This prevents the immune system from "giving up" during the attack.

The technology to understand and develop these therapies hasn't existed until recently. The biggest advance has been our understanding of genomics. In other words, scientists have learned to manipulate human cells to perform certain actions. For immunotherapy, that means getting the immune system to target and attack cancer cells. And early results show we are making great strides.

Immunotherapy has been hailed as Science Magazine's "breakthrough of 2013." Citi Equities Research estimates immunotherapy will generate $35 billion a year in the coming years. But that estimate is conservative. Cancer treatment as a whole is already a $100 billion-a-year industry in America – and will clip $130 billion in the next few years.

In short, the immunotherapy trend is just getting started... and it could produce incredible returns for early investors.

Some of the big winners of the immunotherapy trend will be pharmaceutical giants that have made major investments in the immunotherapy space, like Merck (OTO: MKGAY, Stock Forum), Roche Holdings AG (OTO: RHHVF, Stock Forum), and Bristol-Myers Squibb Co. (NYSE: BMY, Stock Forum).

However, the biggest beneficiaries will be smaller names developing early-stage immunotherapy technologies to help treat cancer patients all over the world. My advice is start researching small immunotherapy names with experienced management teams, solid balance sheets, and partnerships with large pharmaceutical companies like the ones I mentioned above.

The long-awaited revolution in the fight against cancer is here. And this trend could offer life-changing returns for early investors over the next few years. The key is investing now... before immunotherapy hits the mainstream.


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