Capital Allocators – Inside the Institutional Investment Industry Andy Acker - Empty Rooms: Investing in Biotech at Janus Henderson (Capital Allocators, EP.274)
Oct 6, 2022
Andy Acker, a Portfolio Manager at Janus Henderson Investors, brings his expert insights on navigating the often-overlooked biotechnology sector. He shares his fascinating journey from biochemistry at Harvard to investment success. Acker discusses significant advancements in drug development and the implications of the '90-90 rule' for biotech stocks. He delves into gene-based therapies and the potential they hold for addressing unmet medical needs. With a focus on current market risks and opportunities, Acker sheds light on how contrarians can thrive in this empty room of investment.
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Path to Healthcare Investing
- Andy Acker's family has a strong medical background, but he chose investment due to his interest in finance and dislike of blood.
- He started his career at Morgan Stanley, then transitioned to Janus Henderson after business school in 1999.
Biotech's Rapid Advancements
- Biotech has seen immense progress. Sequencing the human genome now takes hours and costs hundreds of dollars, compared to 13 years and $3 billion in 2000.
- This allows scientists to better understand genetic causes of diseases and develop targeted therapies.
The 90-90 Rule
- The "90-90 rule" highlights the risks in drug development: 90% of drugs fail clinical trials and 90% of market estimates for successful drugs are wrong.
- This creates opportunities for investors who can accurately assess probabilities.