Friday, October 26, 2007
For about the past 100 years, doctors treated their patients with what we can now call a crude methodology; they simply waited until you developed a disease, then treated you like they did every other sufferer.
But now, the era of treating every patient the same – the "one size fits all" model – is coming to an end. We are at the beginning of a new era of "personalized medicine." You see, researchers have discovered that your genes (more than diet, exercise, or habits) determine whether or not you get sick and how you respond to medication.
Doctors and scientists have also identified genetic variations that predict whether or not you will get cardiovascular disease, Alzheimer's, cystic fibrosis, melanoma, hemophilia, liver disease, muscular dystrophy, Parkinson's, and Huntington's disease – just to name a few. They've known about these genetic variations for more than a decade.
Until recently, however, there was no way to test for these mutations before they caused problems. And there was no way to know how your individual genes would affect your treatment or therapy. That's all changed in the past decade however... and the change is one of the biggest investment opportunities in the world...
Doctors can now diagnose diseases extremely early in their progression, simply by looking at your genes and the biomarkers in your blood. And they can even tell, simply by running a few tests, which diseases you are likely to get in the future. Depending on your genetic makeup, doctors will prescribe a treatment specifically for you.
If there's a poster child for personalized medicine, it's the diagnostics industry. The diagnostic testing market is $45 billion annually, a fairly large number. Yet, this represents only a measly 2%-3% of the U.S. health care market (about 10% of health care spending goes to administrative costs).
Right now, laboratory tests are used for the detection, diagnosis, evaluation, monitoring, and treatment of disease. The convergence of information from the human genome project and rapid advances in information technology has made individualized genetic testing the fastest-growing segment of the diagnostics market...
That's been a boon for industry-leader and mainstay in the Medical Investor portfolio, Gen-Probe (GPRO). This $3.6 billion company has developed technology that uses a germ's own genetic makeup to identify it. Its products test for pathogens including chlamydia, gonorrhea, tuberculosis, strep throat, pneumonia, HIV, hepatitis C, hepatitis B, and West Nile virus. Gen-Probe is responsible for screening up to 80% of the nation's donated blood supply.
Gen-Probe's tests are faster and more accurate than traditional methods, and the company has begun to expand into industrial testing and cancer screening. Since our February recommendation, we're up 50% with this play on the emerging personal medicine trend.
Gen-Probe is no longer the bargain it once was... and I tell its story to illustrate how money can be made very quickly in the right diagnostics business.
For now, I recommend you keep an eye on the short list of companies that specialize in personalized medial testing. As this new industry develops, investors will find it's one of the most profitable investments in medicine.
World's largest software company, Microsoft, breaks out to new 52-week high.
Blue chips hit new highs... McDonald's, Yum! Brands, Charles Schwab, Merck, and Coca-Cola.
Telecom still rising... France Telecom, Deutsche Telekom, Telkom SA, Telemig Celular, Vodafone, Golden Telecom, and Millicom International hit new highs.