Long-time Rule Breakers Karl Thiel, Rick Munarriz and Tim Beyers offer up three stocks that face dark clouds they can see through. Who are your favorite Broken Breakers? Karl Thiel, Rick Munarriz, and Tim Beyers: - Discuss the implications of mass restructuring at the federal agencies governing biotech and health care innovations. - Profile 3 stocks broken by bad decisions, bad luck, or bad timing, but which still have plenty of Rule Breaking potential. - Play another game of Yes, And! with three stocks from the Rule Breakers Database. Don’t wait! Be sure to get to your local bookstore and pick up a copy of David’s Gardner’s new book — Rule Breaker Investing: How to Pick the Best Stocks of the Future and Build Lasting Wealth. It’s on shelves now; get it before it’s gone! Companies discussed: ARGX, CELH, CRM, TTD, BMY, PGNY Host: Tim Beyers Guests: Karl Thiel, Rick Munarriz Producer: Anand Chokkavelu Engineer: Dan Boyd Disclosure: Advertisements are sponsored content and provided for informational purposes only. The Motley Fool and its affiliates (collectively, “TMF”) do not endorse, recommend, or verify the accuracy or completeness of the statements made within advertisements. TMF is not involved in the offer, sale, or solicitation of any securities advertised herein and makes no representations regarding the suitability, or risks associated with any investment opportunity presented. Investors should conduct their own due diligence and consult with legal, tax, and financial advisors before making any investment decisions. TMF assumes no responsibility for any losses or damages arising from this advertisement. We’re committed to transparency: All personal opinions in advertisements from Fools are their own. The product advertised in this episode was loaned to TMF and was returned after a test period or the product advertised in this episode was purchased by TMF. Advertiser has paid for the sponsorship of this episode. Learn more about your ad choices. Visit megaphone.fm/adchoices Learn more about your ad choices. Visit megaphone.fm/adchoices
Full Episode
When are broken breakers worth buying? We break it down. You're listening to Motley Fool Money. Welcome, Fools. I'm your host, Tim Byers. And with me, our longtime Rule Breakers teammates and old friends, Rick Benares and Carl Thiel. It's a Gen X Power Half Hour. Today, we're talking about our favorite broken breakers, innovators that have yet to convince the market of their long-term potential.
Carl, Rick, we've got a lot to talk about. But first, Carl, since we've got you here, I'd love to take just a couple of minutes to talk about the federal layoffs and any potential consequences you see for the biotech industry. And for those who haven't been following along, this relates to federal cuts having to do with CDC and related health and human services agencies.
Carl, what do you see in here and what should we pay attention to as biotech investors?
We're seeing things that have been affected both by budget cuts and then also by the government shutdown. I don't want to underplay any of this, because every agency that gets cut can have a big impact. But I would say the most important ones Near-term for investors is FDA.
The good news there is that FDA is largely funded by user fees, so drug companies literally pay for their own reviews, which does mitigate the impact somewhat. The agency has said something like 86% of employees are still active, and that keeps them active even through the government shutdown.
The bad news in that regard is that there are certain things that they cannot do during the government shutdown. One of them is, accept new NDAs or BLAs. You cannot accept any new drug application that requires a user fee payment, because literally, there's nobody to operate the till. If you're trying to submit a new drug, you can't do it during the shutdown.
This is one of those things that if the shutdown is a few weeks, hopefully that doesn't impact things too much. Obviously, the longer that drags out, the more serious that gets. Companies that already have pending applications for the most part should be okay. Companies that are looking at making new submissions a little further out, hopefully, will be back in business by then.
But there is a little awkward period right now. I will say, there's some mitigation to that as well. If you're a company that's trying to submit a new drug application that is for something already approved, to pick a random example, Ionis has said this year that they're going to submit an approval for a drug called Tringolza, which is for high triglycerides.
It's already approved for a rare disease, and because this is therefore a supplemental application, it doesn't require a user fee, and they should be able to submit that on the normal schedule. So, that's the sort of good news and bad news on that. And then, I think the other biggest impact for the industry has been all the NIH budget cuts and grant issues.
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