No. of Recommendations: 8
The first time was ca 1999, when I thought Amazon had the possibility of revamping consumer behavior in the US. I bought some (then sold some first when I realized I had no idea what the price
should be, in the absence of, oh, net profits, and the rest a few years later when it seemed as if AMZN was forever an accounting house of cards: there's only so long you can sell things at a net loss before gravity catches up.) I did buy back some when AWS arrived on the scene. Made some money, not a lot.
The second time was when Apple came out with the iPhone in 2007. With a sixteen- and fourteen-year old son in the house, my unbidden first thought was:
Another societal game-changer....they're going to sell a zillion of these things. I bought (then donated the shares to a nonprofit I chaired after a quadruple).
Now it's the GLP-1 agonists.
Despite the run-up of the last few years, I think we're at the inflection point of the curve, and that the use over the next couple of years may be constrained principally by manufacturing limitations. There's increasing anecdotal rumbles that the Ozempics of the world have benefits for everything from arthritis to hypertension to diabetes to almost any immune-mediated disease, and I strongly suspect in a group of 100 insured overweight adult Americans (which is to say, maybe 120 insured adult Americans), six of them may be on it this year, twelve next year, sixty in five years and ultimately only topping out in as many of them who can be persuaded into a weekly injection.
Bad things can, of course, still happen. Here, I also have a strong sense of deja vu: I was in my training when a class of drugs called the HMG CoA reductase inhibitors were first being tested. Given their mechanism of action I was wary of potential long-term liver toxicity at least, and thought they would mature to be at best a niche drug.
I was wrong. They're now called "statins" and it seems like anyone over 40 has a prescription for one.
Getting back to the GLP-1 agonists, there are five in the US right now. Clinically interchangeable, as near as I can tell:
Dulaglutide, "Trulicity", approved by the FDA for type II diabetes (DMII, the very common adult type). Mfr:
LillyExenatide, "Byetta", for DMII.
Astra-ZenecaLiraglutide. "Saxenda" for obesity; "Victoza" for DMII.
Novo Nordisk.Semaglutide. "Wegovy for obesity; "Ozempic" for DMII
Novo Nordisk .
Tirzepatide (slightly biologically different from all of the above; doubtful significantly different I think) "Zepbound" for obesity; "Mounjaro" for DMII.
LillySo it looks like
Lilly and
Novo Nordisk are ahead, with four of the five drugs (and seven of the nine approvals) between them. Others may follow, but there's hella firs-mover advantage embedded in this group already.
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In addition to a very large amount of Berkshire Hathaway in my core retirement nut, there's also the $2,000 IRA I opened in 1986? 1987? I moved it all to BRK about 15 years ago, and it's now around $45K. It's earmarked for nothing at all, and will probably either be passed to my heirs or possibly as a discretionary expense a long time from now (blowout extended family vacation in ten years?)
Anyhow, Jim has just convinced me (
https://www.shrewdm.com/MB?pid=474517153 ) that BRK is most likely to sit there for the next year or so. While I'm leaving the core retirement nut as-is, that may be the final straw for this discretionary IRA.
So the next step is to look at Lilly and Novo Nordisk, mostly for big hidden snakes under rocks. Barring that, I might soon just split that $45K into these two, then shut the vault on it for five years or so.
So I'm putting down my marker, and inviting y'all to come on back here on, say, July 1 2029, and see how I did predicitng that 50:50 LLY:NVO would not be substantially inferior to 100 BRK over that specific five-year period.
Unless some unexpected long-term toxicity rears its head. It happens, even in the FDA era (look up terfenadine in Wikipedia). In that event, no blowout vacation, and I take them all out for ice cream instead. That would be ok; I like ice cream.
--sutton
