Power Lunch - Rare Disease Day 2/29/24

Episode Date: February 29, 2024

Today is February 29, the rarest day on the calendar and we are marking what is known as Rare Disease Day. It's a day to bring attention to disorders affecting relatively few people, but there are still thousands of these diseases out there impacting millions of families. We'll talk to the head of the National Organization for Rare Disorders about the scope of the problem, plus the CEO of a company working in this area about the process for getting treatments approved. We'll also take a look at some of the stocks involved in this space as possible opportunities to invest in the companies working to treat, or even cure these diseases.  Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Welcome to Power Lunch, everybody, alongside Courtney Reagan. I'm Tyler Matheson. Glad you could join us on this February 29th. It is the rarest day on the calendar, and we mark it as rare disease day. It is officially such. A day to bring attention to disorders affecting relatively few people individually, but when you realize there are thousands of these disease out there, combined, they affect millions of families.

Yeah, statistics are pretty staggering, actually. Coming up, we will talk to the head of the National Organization for Rare Disorders about the scope of the problem. You might be surprised as I was. We'll talk to the CEO of a company working in this area about the process for getting treatments approved and we'll look at some of the stocks involved in this space as possible opportunities to invest in companies

working to treat or even cure these diseases. But first, let's give you a check on the market. It says stocks are mixed following the latest read on inflation that we got here this morning. We have the NASDAQ composite up about 6 tenths of a percent, the S&P 500, up 3 tenths of a percent. without Jones, the thresholds just about flat a hair to the downside. Let's bring in Mike Santoli for more on the market reaction to this morning's PCE number.

Mike, I mean, it was about what we had forecast, but still hotter than, I guess, what the Fed wants to see. For sure, Cordy, I would characterize the market response as kind of mild relief that it wasn't an upside surprise versus forecast. We've had two or three in a row inflation reports that did come in hotter than anticipated in hope. So this was at least on target, and it was warm in the areas we've known were going to be stubbornly so, like a lot of services, things, a lot of inferred prices on financial services. So it seems if the market is not really doing much with that number. However, right before the report, we were looking at a one-third of a percent decline in the S&P 500. We're now up a third of a percent. So that's a decent swing.

To your note, you went from a 4.7 down to about 462. So it's obviously not a huge swing in either way, but it does show you. that we're sort of checking off the box that the Fed's preferred inflation measure isn't any worse than we thought it was and inflation's kind of bouncing around below 3% somewhere. All right, Mike, thank you very much.

So I want to stay right there as we bring in our next guest who says the data don't matter all that much. He says the Fed has a fiscal problem, not a rates problem. Keith Fitzgerald is the principal of the Fitzgerald group. Keith, welcome.

Good to have you with us. What do you mean it has a fiscal problem? Explain. Sure, I'd be happy to. You know, the government, take it or leave it, It doesn't matter which side of the aisle you're on has a spending problem. As long as that continues, the Fed really has to struggle because they may as well be taking blood out of their left arm and putting it in their right arm.

The markets are going to address this. So that's what I mean by that. So what does that leave us as an investor to do when you see inflation coming in basically 2.8 percent, a little higher maybe than the Fed would ideally like to see year over year. But the point four rise in January is nothing to be terribly alarmed about. What should I do with my money now? Well, you've actually raised a very interesting point. I think now is the time to take a deep breath to stick with what you know. And that's the great companies, world-class companies,

that continue to put up great results, great numbers, regardless of what the Fed actually thinks it's going to do or what traders think the Fed's going to do. Let's talk about one of your picks and let you make your thesis known on Apple, which I think you think is a very good buy at these prices, in part because it has now sort of junked its own. automobile operation and gone all in clearly on AI. I do. I see this is another sort of jobs-like moment when he introduced the iPhone back in 2007,

I think it was if my memory served. You know, this is a moment where you're going to see a pivot, something that is going to dramatically change the way the company is perceived. Tim Cook's been hinting at it. If you look behind the scenes, I think Apple is a lot more involved in AI than the world understands. And whatever happens in June, the development, developer conference, I think is going to take a lot of people by surprise. So I see prices moving sharply higher, perhaps even $275 a share or so. That's pretty high compared to where we sit right now on Apple shares, which are just above 180. Do you have a stake in Apple?

Yes, I do. I own it personally. My family does, and our firm continues to recommend it to clients. Got it. Mike, when you look at a name like Apple, which has been an underperformer, we used to say, as goes Apple, so goes the rest of the market. That doesn't necessarily seem. to be the case anymore. After the announcement, knowing that they're walking away from the car, but potentially putting some more firepower into AI, which has really driven a lot of market growth. Do you feel like maybe Apple's back in the game, we can use that as sort of this market sentiment marker? I would say it remains to be seen, Courtney. I mean, there have been periods of time when

it's hard to really remember, but when Apple's gone sideways for a year and a half and the rest of the market was up. So it's sometimes a bellwether and sometimes not. big takeaway from the action of the first two months of this year is the market has answered some of the biggest criticisms thrown at it entering 2024. One, it's way too reliant on six or seven massive growth stocks, including Apple. Well, you see an Apple falter, you see an alphabet falter, and the rest of the market is hanging in there and actually posting gains. The other one is the stock market is overly dependent on rate cut soon and deep ones. And we've had the revised outlook to say, nope, we're not getting a rate cut in March, maybe not till June or July,

and not many this year, and the market's hanging in there. And that's all because nominal growth has been good, earnings have come back, market has made gestures toward broadening out. I think that's really an important point that Mike you just made there. And that is the idea that the market has been able against, you know, maybe the popular consensus to make progress, even though interest rate cuts are not imminent. They're not coming in March, apparently. They may not come in May, I is the next one. Maybe not even until the latter half the year. Keith Fitzgerald, let's go to one other stock you like, and that is Chevron. What's your thesis there? Well, again, you know, I'm a big fan of keeping things really simple. This is a case where, you know, the backlash against

EV for one reason or another, whether it's pricing, availability, manufacturer, challenge, it doesn't matter what. But the point is, we're going to need dinosaur juice for a lot longer than we think. The company is cash efficient balance sheet. They've returned a huge amount of cash to shareholders. They're expecting to produce three, four, five percent, maybe even more oil this year, high margin activity, 37 consecutive years of dividend. It's a solid holding that you can count on. Keith, thank you very much. Keith Fitzgerald. We appreciate it. Mike Santoli, you as well. Let's go now to Emily Wilkins in Washington on breaking news, efforts to fund the government and avoid a shutdown. Emily.

Hey, Tyler. Well, Congress is rushing to avoid a shutdown that is now set to start on Friday at midnight and it's looking good for being able to avoid that. The House just now getting the votes needed to go ahead and pass that stopgap measure, kicking the can down the road to March 8th and then to March 22nd for both pieces of government funding. That bill could now go to the Senate where it might be able to actually pass today. Remember, you need all senators to agree to time limits if you want something to move quickly. That seems like it does have the potential to happen. At this point, Congress is moving quickly to try and get that stopgap in place, which means now the real big question, can they actually make these deadlines after moving the goalpost yet again? Can we actually see some full fiscal year spending bills by March 8th and March 22nd?

Lawmakers on the Hill are confident, but we have heard that before, so we're continuing to watch this closely. I was just going to say, it feels like similar story, different day, different year. Thank you very much, Emily Wilkins. Let's get to the bond marker reaction to that latest inflation read, Rick Sintelli, joining us now from the Windy City. Hi, Rick. Hi, indeed. We had a lot of numbers this morning. And let's hit some major highlights.

Year over year-year PCE Corps was something many were very anxious to monitor. And how did it show up? Well, as you look at this chart, which starts in January of last year, we now have 12 consecutive months of lower year-over-year-over-year PCE Corps. as you see that line moving down. Now, here's one of the rubs. If you open that chart to pre-COVID, you can see that even though we have come down, we are still a ways from where we were pre-COVID

and we're still on our way to target 2%, but we're not quite there yet. As a matter of fact, if you continue to look at all the variables today, continuing claims also is a bit surprising. It came out over $1.9 million. We haven't done that since mid-November of last year. year. And as you see on this chart, I went back to November of 21 because that's how close we are to levels going back that far. We definitely want to continue to monitor the slight increases we are

starting to see in claims they have been well behaved, but we are now monitoring them with a fine tooth comb. Finally, here's a chart year-to-date of two-year and tenure on one chart, and there's several things I'd like to point out. Right now, we're at basically 462 in a two-year. pre the number releases, we're at 468. So we've had a decent drop, but on the session, we're only down two. And if you consider that right now, we are now looking at a 468 pre-number, but before the 431 pre-on tens, now that moved down about eight base points. But here's what I want to say.

If you look at the all-time high for 2024, we're now 10 basis points below that, two's, but we're up 37 on the year. If you look at tens, right now where it sits at 423, we're down nine when it comes to the high yield closes, but we're up 35 on the year. You get what I'm saying. We're hugging up to higher levels, even though those numbers were to many, just perfect with respect to inflation. Tyler, back to you. Rick, let me just get your sort of put your forecasting hat on. As we sit there with the 10-year in the 420-somethings, Is it your view that we're likelyer to stay right around here in this sort of higher part of the band than go back to where we were a couple of months ago in the high threes? I absolutely do.

I think that based on the way it's acted for 2024 and those ratios I pointed out, I think it's actually more likely that we will be more in a range of four and a quarter to four and a half than we will be from anything under four up to four and a quarter. All right, Rick, thank you very much. much Rick Santelli reported for us. Meantime, coming up from Chile to Mexico and all the way to Europe, Chinese car brands are exploding in popularity. We'll look at why next. Plus, still to come in the program, an in-depth look at an issue that affects one in ten people here in the U.S.

Rare diseases and conditions. Chances are you know someone afflicted. So on this rare disease day, we want to shine a spotlight on the people, the industry, and the treatments that are out there and may be coming. We'll be right back. Welcome back to Power Lunch. Late last year, China's BYD passed Tesla to become the world's biggest selling electric car maker. But you won't find any BYDs on the streets in the U.S.

So we sent Phil Habeau to Santiago, Chile, to find out why Chinese brands are so popular there. Phil, I know very little about this car. You know, Courtney, we're here in a mall in Santiago, and this is the BYD Dolphin. This is the smallest BYD EV that is sold, though. It is the precursor to what we'll be coming out over the next year, which is the Seagull, which is an even smaller one that is expected to be priced for about $11,000. Here in Santiago, BYD entered the market last year. What about Tesla?

They just entered the market earlier this month. In fact, we went to what you might call the Tesla Gallery. It's really more of a cube that had a Model 3 inside of it, though a few people were coming by and taking a look at it. You could go in and talk with some representatives about potentially buying a Tesla. In terms of South America, it's just starting to develop as an EV market. That's why Tesla's first market down here is Santiago, Chile, though they expect to expand over time. Global EV sales, if you take a look at the numbers last year, let's be clear.

We're talking about pure electric vehicles. We're not talking about hybrids here. It was just under 9.5 million, 11% of all the vehicles that were sold last year. And yes, last year, Tesla was number one selling 1.8 million, BYD, number two, at 1.6 million. The person who runs the BYD dealership here in Chile believes that they will gradually but steadily increase sales here. The reaction has been fantastic because it's a very strong brand with a new technology, electric vehicle cars, PHB cars. So the people are arriving to the stores. They are going to our new store to try to understand how is this new technology.

And they have been listening too much about BYD. they will. As you take a look at shares of BYD and Tesla, we should point out that over the last year, they've roughly traded in tandem with each other. Not a surprise. You tend to see this. Two EV companies tend to be trading in the same way over a period of time. By the way, BYD did outsell Tesla in the fourth quarter. So you will hear some people say, BID is number one worldwide. Well, we look at the sales on an annual basis. And last year, Tesla was still number one. Will that change this year, likely because BYD is growing sales dramatically in China. And as we know, Tesla has been much more judicious and has had to deal with the price wars that are going on in China. But now

they're competing here in Chile. And we'll see it about increasingly in other parts of South America as well. Guys, back to you. I was just going to say, Phil, I'm struck by the prices. The BYD car is significantly less expensive than Tesla. I'm sort of surprised they've only sold 1.6 million of them. Well, they do sell a lot of hybrids. If you add in BYD's hybrid sales, which are even greater than their pure electric vehicle sales, it's over 3 million. But they're growing the pure electric vehicles. And remember, they have cost advantages because of their size and scale. And Chinese automakers also have a number of inherent advantages as they've grown those businesses with government support in China.

Question. We know about the relative price difference between the BYD and the Tesla. What do we know about the relative performance and or reliability of those cars, the BYDs? BYDs are fairly well regarded in terms of their reliability and their range. Now, having said that, Tyler, a lot of people in the U.S. will say, well, I haven't seen a BYD in the U.S. They would like to eventually sell in the U.S. But right now, if you build a vehicle in China and export it to the U.S., there's a 25% tariff that gets added on. So that's why you're not seeing BYD's in the U.S. yet.

However, BYD is likely going to start manufacturing in Mexico at some point in the next four or five years. We haven't seen them announce officially where the manufacturing facility would be, but we know they're looking at it. And when that happens, that gives them entry into the U.S. through the North American Free Trade Agreement. That's really when the direct competition, aside from what we see in China, where BYD and Tesla do compete vigorously. But in terms of in the United States, that's when you'll see them go head to head. All right, Phil, thank you very much, Phil Lebo, reporting from Santiago, Chile. All right, stay classy, Santiago. All right, still to come.

Check out shares of Pfizer, the company holding its Oncology Innovation Day. And with today also being National Rare Disease Day, health care front and center this hour, we're going to take a look at the different ways investors can play the space, including gene editing pharmaceutical firm CRISPR. We'll talk to the CEO. Hauer once will be right back. Welcome back to Power Lunch. I'm Bertha Coombs with your CNBC News Update. As expected, Donald Trump has appealed a Wednesday night ruling disqualifying him from the Illinois Republican primary ballot.

A judge said the former president should be removed from the vote for his role in the January 6th insurrection at the Capitol. Mr. Trump's team called the move unconstitutional. A recently introduced bill to protect in vitro fertilization in the state of Alabama just passed. passed with a commanding majority in the state's house. It now heads to the Alabama Senate for consideration. Lawmakers are responding to an outcry across the state and the country, following the Alabama Supreme Court's decision to define frozen embryos as children. Several fertility clinics pause their IVF programs over legal fears in that state.

And hundreds of items belonging to Sir Elton John sold for more than double their estimate, at auction, rocketing to $20 million. Among the items that were up for grabs, a grand piano used by the Rocket Man, his prized classic Bentley, and a leopard print Rolex Daytona, which was encrusted with 36 orange sapphires. I don't see it there yet. And apparently four dozen diamonds. There it is. That is one fancy timepiece. Back to you. There's a lot of bling. go on on there. Thank you very much, Bertha. Right. Well, still to come, our coverage of an issue that affects millions of Americans' rare diseases. Sounds kind of like an oxymoron, but we'll explain it when we speak to some influential names in the treatment space that's next. And as we had to

break, a quick power check on the positive side, formal, of 13% being on earnings. On the negative side, Excel Energy lower after a law firm alleged it is linked to the Texas wildfires. We'll be right back. Welcome back to Power Lunch. Well, today is a leap day. It is all National Rare Disease Day, a day to bring awareness to rare diseases and to the many people and families affected by them. Joining us now, Peter Saltonstahl, president and CEO of the National Organization of Rare Disorders, also known as Nord. And here on set with us, Dr. Scott Gottlieb, our friend, former FDA commissioner, and a CNBC contributor. Welcome to both of you. Peter, let me begin with you.

What is a rare disease? How do you define it? Rare disease in the United States is defined as a population of patients under two. 200,000, and that's the driver for the Urban Drug Act. If you put all of those diseases with 200,000 or fewer cases combined, how many people are you talking about in the aggregate? Well, we say that there are 7,000 rare diseases

and about 30 million people in America, one in 10 Americans that are impacted by rare diseases. So it's a significant number. So rare diseases are prevalent then. They may be rare, but in, in, In some, they are quite prevalent. That is correct. That is correct.

And I would say, Tyler, that, you know, the important thing here is with the 7,000 rare diseases and the 30 million Americans, 95% of them now don't have an authorized or an approved FDA therapy. And so that's a real challenge. So we have 95% of the population who don't have a therapy. How costly are these diseases in the aggregate, number one? And number two, are they normally life-threatening, life-lreatening? or are they chronic and manageable in that sense? I'm not a physician, so I'll let Scott answer part of that question,

but I can tell you that they are economically a burden on the economy and the country, because the issue of being misdiagnosed happens to patients continuing. Most of our patients, it takes four to five years to get diagnosed. So there's a lot of health care costs that goes into that before there's even a therapy developed. So it's inexpensive, it's inexpensive and a timely and, you know, a complicated issue for patients. Scott, are rare diseases increasing? It feels like I'm hearing about them more, or is it just the awareness of such is what we're hearing about? Yeah, I think it's awareness and I think it's also that more rare diseases are addressable now.

So now we're talking about them. You know, Nord has been instrumental in getting in place incentives for companies to try to develop drugs for these diseases, including the orphan drugs. Act getting that implemented initially and also sustaining it. I think we're in an environment now where it's more difficult to get policy to confer incentives for the development of some therapeutics for these rare diseases. And what we're looking at is super orphan diseases. You know, diseases that can affect thousands and sometimes hundreds of patients where you now have the modalities to try to treat some of these diseases where the economic incentives aren't always there, not we staying the very high prices that are charged for these drugs. It could still be very

un-economical to develop therapeutics for these indications. And we're not, we don't have the same policy solution. for these challenges that we had years ago because you don't have the same consensus in policy circles, and particularly diseases where you have sort of a common phenotype. So patients have a common experience, but there might be a different genetic variation for even individual patients,

where you now have platforms like S-I-R-N-A or oligalucleotides, where you could literally change the drug for each individual patient to attack some of these diseases like BATN's disease. Those are the places where it's very hard, not only to get the incentives in place, but even the regulatory path for some of these potential

cure is and certainly treatments. You're on the board of Pfizer, right? How do you incentivize a large pharmaceutical company to try and develop a drug for one of these rare diseases when they know that it may be 150 people in the United States who might take it? Yeah, I think the

challenge for a bigger drug maker getting into some of these spaces is when you look at some of these drugs, if you're talking about just hundreds of patients that might suffer from a condition, the sort of political backlash to charging the high prices that you need to sustain the investment and get a return on the investment is very hard to do inside a big drug maker because they're more prone to getting

the sort of political recriminations over the high prices. So you see this be largely the domain of smaller companies, which I think have more latitude to charge those prices. So you've seen in recent years large companies get out of these orphan spaces, and that does worry me that you see capital coming out. And I'm talking particularly about the super rare diseases where there's still, I think, is a market failure. And also, it's very hard to do second-to-market innovation in some of these indications. So what happens is that after a therapy comes to market, and you treat everyone with an inherited condition, for example, the number of patients who will be newly diagnosed each year with that condition isn't enough

to sustain someone else coming into that space. And so some of these categories remain monopolies in perpetuity because you just can't incentivize second-to-market innovation that would bring down prices. Let me ask you a question about the regulatory environment, Scott, and I'll come back to you, Peter, in just a moment. I'm guessing that the regulatory regime is set up to, to, to test drugs for the broadest effect, efficacy and safety, for the broadest number of people. And here you have, by definition, conditions where there may be 150, 200, 500 people in the United States.

How do you test drugs in such a small sample set? Yeah, look, it's very hard. And that's why when I was there and FDA has continued to try to build what we call natural history models where you can randomize against what is perceived to be the natural history of patients with a condition. so you don't have to randomize to placebo. But when you're talking about these modalities where you can individualize the treatment for patients based on their unique genetic profile,

where they have sort of a common phenotype, like Baton's disease, but every patient might have a very small difference in the genetic variation that drives the disease, and you want to deliver the drug, you want to tweak the drug for each individual patient. That's very hard because the regulatory model tries to incentivize the standardization of treatments and not the variation for each individual patient.

And that's what we need, I think, some novel thinking about the regulatory path. Peter, I read that 80% of rare diseases are genetically based. Does that provide us, now that we are mapping genes and with technologies like CRISPR and others, we can actually target genetic malformations or whatever they are? We can target them. Is that a point of promise for the treatment of rare disease? And if so, how big a point of promise is it? I really think, again, and Scott, what Scott just said about how drugs are being developed now,

I think the genetic issue for us really is the future on the frontier. And what we're seeing now more and more is the opportunity for people to be able to get something basically just for them, if you will, which does still create the problem that we were just talking about, which is much smaller populations. And there is not a policy or regulatory form right now that allows, us to be able to do that really effectively. So I think while it's the future is there, there's a lot of work that needs to be done on the regulatory front to be able to make sure that we can get drugs approved and then paid for for these smaller populations. In other words, if I have a small population and I'm tweaking the drug so it works only for you or essentially

only for you, then you become in a way the test case for that drug, right? You become the gap. Exactly right. Yeah, these are these end of one diseases and that's what we go from It might not be an N of one. It might be five or six patients with one unique genetic variation. What you need to have is a pathway that allows companies to study sort of an aggregation of these patients and then extrapolate beyond that to other patients that have the common phenotype. They have the common syndrome, but they might have different genetic variations that might not have been included in the clinical trial.

And that's where the regulatory hiccup is right now in the willingness of regulators to allow that extrapolates. The system isn't set up for that. No. And it's been something that's been talked about literally for about 10 years right now, how to create a viable regulatory model for this, that's where the real opportunity is for these super rare diseases. And a lot of them are inherited diseases that children are born with. So there's a really compelling desire to try to get treatments. So notwithstanding the economic model, which I think

also is a barrier to the investment in these spaces, the regulatory model does become also an impediment. Wow. Let me add to what Scott just said, because I think there's one other really important point, and that's that they're trying to find those patients as well. And one of the things that we've done in the last couple of years is developed a broad network called the Centers of Excellence where we've now connected 41 of the top academic medical centers around the country and are connecting all of those clinicians via a thing called Nord Central. So if they see something in a unique

patient, they can then reach out onto that network and ask other clinicians if they see something like that so that we can start to bring, as Scott was just saying, some of those small populations identify those people and bring them together. It makes a lot of sense of information sharing really paramount to solving some of these very difficult problems. Really important conversation. Peter Salt and Stahl, thank you very much. And Dr. Gottlieb, stick around. We're going to have much more with you to come. Still ahead. We'll continue our special coverage of Rare Disease Day with a leading name in gene editing, CRISPR Therapeutic CEO, Sam Colcarney joins us from Power Lunch returns. Welcome back to Power Lunch as we continue to mark Rare Disease Day. Let's take a closer look now at companies trying to do good and do well with

treatments for these diseases. Look at Krenetics Pharmaceuticals. up 115% in a year. See that big spike in September fairly straight up there? That was on positive news regarding a treatment of a rare hormone disorder. Bridge Biopharma has also tripled

in the past year with a big jump last July when each drug to treat a rare heart disease showed positive results in a trial. CRISPR therapeutics is another name involved in the rare disease space. You might have heard of it. Seeing some pretty big gains over the last year as well, up over 70% in a year.

So joining us now as Samarath-Kalcarney, He's CEO of CRISPR Therapeutics and Dr. Scott Gottlieb, former FDA commissioner and a CNBC contributor, is still with us. We should say that Dr. Gottlieb is also a partner at the venture firm, New Enterprise Associates, which is an early investor in CRISPR. Thank you very much for being here, Sam. Really appreciate it. I mean, obviously, we had a very fascinating conversation. I don't know if you were able to hear all of it, but it's sort of about the hurdles to getting some of these drugs through when it comes to regulatory or otherwise just being able to. to invest the money that it takes to tackle some of these issues. Where are we right now with

your company, with CRISPR, when it comes to tackling rare diseases? Yeah, thank you for having me, and it's great that you're recognizing World Rare Disease Day in the last segment, speakers mentioning that there are 7,000 rare diseases. And what's disheartening is, you know, 80 to 90 percent of those rare diseases do not have a good treatment available for those patients. And this is where technologies like CRISPR come in. We've had a great year, the last great 12 months, because we had a drug approved for sickle cell disease and thalcemia, two of the more well-known rare diseases with our partner vertex. But that's just the start. You know, what we have with the CRISPR technology is a programmable and scalable platform, which can apply to many rare diseases and not just provide a treatment, but provide a transformative treatment for these rare diseases.

When it comes to what you're expecting going forward, what can we look forward to? Give us some good news on the horizon. Is there research that's just getting so very close to offering some new treatments for some of these individuals? Yeah, Scott will attest the science is moving at breakneck speed, and it's not just CRISPR therapeutics, but the other companies in space as well doing work with rare diseases. We're working with a number of rare diseases, for instance, rare forms of cancer like T-cell lymphomas, We're working type 1 diabetes. We're working on rare autoimmune diseases like lupus nephritis and also neuromuscular diseases. And the science is moving forward very quickly.

The editing is working. We're able to take this CRISPR tool and apply it to a specific location of the genome and make a precise edit that fundamentally fixes the disease. And that's very exciting to see. Of course, there's some challenges such as delivering it to the right organs. You know, if you only want to edit the liver. or only want to edit the brain. You know, we're trying to optimize the delivery solutions, but the signs are very encouraging across all these therapeutic areas. Yeah, just to build on that,

you know, I started working at FDA back in 2000 as a senior advisor to the commissioner, and it was just when monoclonal antibodies were becoming therapeutics getting approved, and they were usually used in sort of third line in treatment of cancer where there was no other available therapy. If you would have come to me at that point in time and said, one day we'll be using monoclonal antibodies to treat high cholesterol, I would have looked to you like you were crazy because there's so much complexity involved in those platforms. I think the same thing applies today. I think the gene therapies right now are being used in these rare indications and these

significant unmet medical needs. But as we get better vehicles for delivering these, as we get better ways to precondition patients before we deliver the gene therapy, you're going to start to see these platforms migrate into more routine conditions and applications like regenerative medicine. So these are just the early innings. I think we look at the profound impact things like CRISPR therapeutics has had in diseases like sickle cell disease and thalcemia, I think you're going to see these kinds of platforms,

these modalities be used in a wider range of diseases, not just rare diseases, but more common ailments as well. So Sam, I think I heard you say, basically, that in certain conditions, with certain gene editing, you can actually cure people. Absolutely, and we don't use the word cure lightly. In some cases, the patients are symptom-free for the rest of their lives, for instance.

And why we're able to do that is because we're going to the root of the disease. You heard from previously that 80% of these rare diseases have some form of genetic basis. And with the whole human genome sequencing project, we really understand what causes the disease, what's the genetic aberration that's resulting in the patient having the disease. And so when you can go to the root cause at the genomic level, you potentially can cure the disease or at least ameliorate all symptoms for life. And the other part of this is, you know, we talked about some of the big pharma

not jumping into rare diseases because the market's not there. CRISPR is a scalable and programmable way of developing therapies, which could make it much more efficient to develop drugs and rare diseases because you're using the same chassis but changing the zip code of where in the genome

you're making a change. So if you have a regulatory framework that allows you to use a modular approach, you could develop drugs in a much more efficient fashion that would allow you to make the business case and develop it even for ultra-rare diseases and still deliver shareholder value. How hard is it when you're dealing with rare diseases? How hard is it to get a treatment approved because the population is so small? If you see what I'm saying, in other words, you don't have thousands of people on whom you can test

your medicine or your treatment? Yeah, it's challenging if you have to do a randomized control trial. And as, you know, when Scott was commissioner, he would attest to it, which is some novel forms of thinking about developing drugs. One is using natural history. You know, if you have a population that you know is declining in a certain way and it's predictable because of the disease and you administer your medicine and that decline doesn't happen, then you have a built-in control for a clinical trial, so you don't have to do a randomized

control. The second is, in many cases, the patient themselves are the control arm. So in our sickle trial trial, you have patients come in with over three or four hospitalization per year or they end up in the ER before they got the therapy. And after they got the therapy, they had no more hospitalizations in most cases. And similarly in talismia, they would come in requiring two units of blood every month. And then after the transfusion, after the therapy, they didn't need any more transfusions. So these are novel ways of thinking about developing drugs that we didn't have in the past.

Sam, if we can very quickly before we let you go. This is CNBC after all. And so we started out the segment talking about sort of the investment case here. But again, as we've reiterated over and over again, these drugs researching them, deploying them are very, very expensive. Can you make the investment case for why it makes sense for us to do this from a financial and economic perspective? of course, we know it's for the good of the human race, of course, but from an economic and financial perspective, can you tell us why this is a good investment?

Absolutely, and we're redoubling our efforts at CRISPR therapeutics because of two reasons. One is with the platform like CRISPR, you're taking a deterministic approach, so you have less failures and less attrition in the drugs you're developing. And the second is, as I said, it's modular and programmable. So if you develop the platform, then you just have to replace the genetic, oligonuclite for each disease. So what that does is reduce the cost of development. You know, in many cases for Bikarma, it costs $2 billion to develop a drug, and you could do that

for much less if the regulatory environment is changing and allows for this. And in which case, even if it's a small market, you still can make a very positive return. And then you have not just the possibly return of one asset, but tens of diseases that are going to cure with the platform like CRISPR. This is so fascinating. Sam Colcarney, thank you very much For joining us, Dr. Scott Gottlieb is here and he's sticking around. All right, coming up, shares of no-no Novo Nordisk are up 70% over the past year. OZMPIC demand continuing to soar. And during February, we celebrate Black Heritage.

Here's M&T Bank CEO, Renee Jones, sharing his story. As a Black CEO of a Fortune 500 company, I may be an exception. But it's important to remember that there are many exceptional people who create positive change and inspire others every day. Black Heritage Month gives us that opportunity to celebrate the many exceptional, absolutely extraordinary people in our black and brown communities across America. It's estimated up to 5 million Americans are taking them. A staggering figure, considering the weekly injections need refrigeration and possibly a lifetime commitment. For Faith Ann and her parents, they were worth a shot. Where do you give yourself a shot?

I give myself a shot in my stomach. Yeah, I don't even like it. Do you can hear the click? It's done. Wow. Can you just tell me what you're on and how long you've been on? I've been on Minjaro since May. O-ZMPIC since July.

Whatever she gives me. Yeah. He's been on, he's, no, he switches. He goes between Manjaro and Ozympic. They're all in a class of drugs called GLP-1 receptor agonists, which mimic naturally occurring hormones in the body. GLP stands for a glucagon-like peptide. And what it does is it helps the body regulate insulin and glucose or blood sugar. But it also helps the stomach feel full faster and longer.

And it also affects appetite centers in the brain so that people have less of a drive to eat. And there are reports that it helps with what we've come to call food noise. Well, that was a clip from Big Shot. The Ozempic Revolution premieres tonight at 10 p.m. Eastern and Pacific here on CNBC. A mega-hit JLP 1 drugs like Ozempic and Mujaro have completely changed the way society approaches weight loss. And Dr. Gottlieb, former FDA commissioner, Pfizer board member and contributed to CNBC who is featured in the documentary is still here with us. How big are these drugs likely to be? And they're not only finding that they're effective against weight gain or bringing on weight loss, but a whole. host of other conditions, potentially even including dementia. Yeah, look, I think these are going to be a profound medical advance on par with maybe the introduction of statins where you're going to change the trajectory of morbidity and mortality associated with a whole range of diseases. And we think about this as a battle of what is the best drug.

It's going to become a battle of what is the best label, which drug ends up getting the best label for trying to prove some of these secondary gains. This is going to be a very important year for answering that question. We saw the select data that Novo Nordisk ran a big trial looking at a substantial reduction and cardiovascular risk with patients who had a previous heart attack or stroke. FDA and the EMA, the European regulators are now looking at that data. They're probably going to approve a change to the label of Wagovi to look to demonstrate cardiovascular risk reduction. And Lilly is also going to have important data with their drug Zepbound this year,

looking at, for example, reduction in the instance of sleep apnea or heart failure associated with the use of their drug. Collectively, between Lilly and Novo, they have more than 15 trials underway that are sort of registration, quality trials, looking at things like, you know, reducing the incidence of osteoarthritis, of fatty liver disease, of dementia. If we continue to show these secondary benefits of the weight reduction that these drugs achieve and get that information into the label, I think it's going to make these drugs very compelling and very hard for insurers not to pay for it if you're having that

magnitude of public health impact. That was going to be my question. Is this going to make them harder for insurers not to cover, number one, and ultimately will it bring down the cost? Well, I think it's going to make it impossible for insurers not to pay for. If you have a drug where you have a cohort of patients who have significant cardiovascular disease, have had a stroke or a heart attack, and you can achieve a 20% reduction in the second stroke or heart attack, and these are patients who have been maximally treated with statins and hypertension medication,

that's such a profound benefit. And the benefit we've seen early in that trial as well, so you didn't need to leave the patients on the drug for a year. You saw it within the first months. That's so profound, and that's going to achieve so much. savings for the health care system overall. They'll leap in. And also the productivity gains. As people lose a profound amount of weight who are obese, they're going to perform better

at work. They're going to have less joint disease, less osteoarthritis. Fewer days missed from illness or debility or whatever. And that data will start to get into the drug labels. The other thing that's going to happen over the course of 2024 and 2025 is both Lilly and Novo and other companies as well have other drugs in development. So Novo has a drug that's a dual acting agonist, acts on both DACA and Glyp-1, Kagrisemo.

They're going to have data in 2025. Lilly has a drug, Redatutide, which is a so-called triple agonist. And these look like better sort of second and third generation iterations on these drugs. So, you know, we're in the early innings of the innovation in this space. This is fascinating stuff. I cannot wait to see this documentary. A great half hour. Tonight, 10 p.m. Eastern Time.

Thank you so much, Dr. Scott Gottlieb, for joining us. for this half hour. We will be right back. What a wonderful hour. It has just been. Let's bring you up to date on the Dow. Basically on 007, James Bond numbers down 26 at this hour. The NASDAQ and S&P in the green. Thanks for watching this special power lunch on rare diseases.