Alzheimer’s Offers Perils and Promise

04/26/2007 12:00 am EST

Focus:

Michael Shulman

Editor, Short-Side Trader

Michael Shulman, editor of ChangeWave Biotech Investor, discusses the growing impact of Alzheimer's disease on an aging population-and the potential of a cure or an effective treatment. 

Alzheimer's disease is a terrible and frightening malady with no cure that has touched many families-including my own. While diabetes, cancer, and HIV are diseases that cost us billions of dollars every year, Alzheimer's (at my estimated cost of $175,000 per patient) could well bankrupt the US public health system within the next generation (not to mention countless individuals and families) if an effective treatment or cure is not found.

With the prevalence of Alzheimer's disease growing and as baby boomers enter their 70s and 80s, here are some facts to take into account:

* The biggest risk factor for people is simply getting older: almost 50% of people older than 85 get the disease.

* Approximately 4.8 million Americans have Alzheimer's disease-a 100% increase since 1980-and, sadly, the number of Alzheimer's patients [may] explode to 11 million to 16 million by 2050.

* The direct and indirect costs of this disease are already a staggering $110 billion.

* Alzheimer's patients comprise roughly 12% of the Medicare population, yet they consume at least one-third of Medicare spending.

Alzheimer's progression is marked by damage to the nerve cells that process, store, and retrieve information. The damage begins before detection is possible, meaning before symptoms appear.

A microscopic structure called an amyloid "plaque" is a marker of Alzheimer's disease, and while it accumulates in the brain as the disease progresses, it is usually found only in an examination of the brain post-mortem.

These amyloid plaques are clumps or chunks of proteins (originally amyloid proteins) that cluster around and adhere to the brain's nerve cells-and, for all intents and purposes, destroy them. Much of today's research effort is aimed at discovering exactly how and why these plaques form, and how they can be dissolved.

Any successful treatment for Alzheimer's will be the next $20-billion drug. It may be a treatment or, perhaps, something akin to a "statin" (i.e., Lipitor or Zocor) for the brain.

While several drugs have been approved, they only provide modest symptomatic relief and their effects typically wear off within six months to a year. There are few new potential winners on the horizon at this time. More than 35 drugs are in some stage of development, but only two companies are in late-stage (Phase III) trials for an Alzheimer's drug- Neurochem (NASDAQ: NRMX) and Myriad Genetics (NASDAQ: MGEN).

If you are going to make any super-speculative, bleeding-edge bets in the biotech segment, this is a good disease to focus on. A blockbuster drug here-one that truly slows or halts the progression of Alzheimer's (or better yet, prevents it)- could make $13-billion-a-year Lipitor look like a minor leaguer.

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