Accessible version US Biopharmaceuticals 2026 Year Ahead: What to expect from our coverage universe in 2026 Price Objective Change Biopharma favorable despite lingering uncertainties Despite its challenges, Biopharma ended 2025 on a high note (NBI +32%, DRG +21% vs. SPX +17%)—with, in our view, reasons for optimism heading into 2026. Admittedly, the macro concerns weighing on 1H25 sentiment (inflation, tariffs) remain overhangs. That said, 1) sector-specific worries, mostly around drug pricing, eased; 2) lo ...

Industry Overview - The drug and biotech sector experienced a volatile performance in 2025, with a significant recovery in the last few months attributed to improved drug pricing policies and strong merger and acquisition activity [2] - The biotech sector has rallied 26% over the past six months, outperforming the S&P 500 index [2] Innovation and Regulatory Activity - Key growth areas in the industry include obesity, gene therapy, inflammation, and neuroscience, attracting investor interest [3] - The FDA approved 44 novel therapies as of December 22, 2025, indicating healthy regulatory activity [3] Company Highlights Mineralys Therapeutics - Mineralys is developing lorundrostat, an aldosterone synthase inhibitor for uncontrolled hypertension, chronic kidney disease, and obstructive sleep apnea [5] - The pivotal phase III Launch-HTN study and phase II Advance-HTN study met primary efficacy endpoints, showing favorable safety [6] - The company plans to submit a new drug application for lorundrostat in early 2026, with shares up 203.4% year-to-date [8][9] Lyell Immunopharma - Lyell focuses on next-generation CAR T-cell therapies, with its lead candidate ronde-cel for large B-cell lymphoma [11] - A pivotal phase III study for ronde-cel is expected to begin in early 2026, and the company has a strong cash position of approximately $320 million [14] - Shares have increased by 191.6% in 2025, with loss per share estimates narrowing from $12.68 to $9.70 [15] Insmed - Insmed markets Arikayce for refractory MAC lung disease, generating $314.5 million in sales in the first nine months of 2025, a 21% increase year-over-year [16] - The FDA approved Brinsupri for non-CF bronchiectasis, with sales of $28.1 million in Q3 2025 [17] - Despite a setback with the BiRCh study, the company is evaluating Brinsupri for hidradenitis suppurativa, with shares up 156% year-to-date [19][20] Nektar Therapeutics - Nektar is developing rezpegaldesleukin for atopic dermatitis and alopecia areata, with positive data from phase IIb studies [21][22] - The company plans to advance rezpeg into phase III development in 2026, with shares soaring 218.8% year-to-date [24][25]

Key Takeaways MLYS' lorundrostat hit key endpoints, supporting plans for an NDA submission in early 2026.LYEL rose as ronde-cel advanced in pivotal studies and new CAR T assets strengthened its oncology pipeline.INSM climbs on Brinsupri's FDA approval, despite a setback in a mid-stage rhinosinusitis study.The drug and biotech sector witnessed a see-saw performance in 2025. After a weak show for most of the year, the sector picked up in the past couple of months. This can be attributed to improved policies f ...

Investment Philosophy - The company focuses on long-term investments in U.S. and European equities, emphasizing undervalued growth stocks and high-quality dividend growers [1] - Sustained profitability, characterized by strong margins, stable and expanding free cash flow, and high returns on invested capital, is viewed as a more reliable driver of returns than valuation alone [1] Portfolio Management - The company manages a portfolio publicly on eToro, qualifying as a Popular Investor, which allows others to copy real-time investment decisions [1] - The investment strategy aims to ensure sufficient assets for freedom in work and life, rather than complete financial independence from work [1] Background and Expertise - The company has an interdisciplinary background in Economics, Classical Philology, Philosophy, and Theology, enhancing both quantitative analysis and market narrative interpretation [1] - The investment journey began with a personal motivation to secure financial stability for the family [1]

Core Insights - Lyell Immunopharma (LYEL) stock has experienced a significant increase of 191% year to date, indicating strong bullish momentum as it approaches 2026 [1] Company Overview - The company is focused on biotechnology, particularly in drug development, leveraging unique mechanisms of action and first-in-class therapies [1] - Lyell Immunopharma aims to reshape treatment paradigms through innovative platform technologies [1] Analyst Background - The analyst has a Master's degree in Cell Biology and extensive experience in drug discovery, which informs their investment analysis [1] - The analyst has been active in the investing space for five years, with a focus on biotech equity analysis for the last four years [1] Research Focus - The research emphasizes evaluating the science behind drug candidates, the competitive landscape, clinical trial design, and potential market opportunities [1] - The goal is to provide insights that help investors understand both opportunities and risks in the biotech sector [1]

Summary of Lyell Immunopharma Conference Call Company Overview - **Company**: Lyell Immunopharma (NasdaqGS:LYEL) - **Focus**: Development of next-generation autologous CAR T-cell therapies for cancer treatment, targeting both hematologic malignancies and solid tumors [4][5] Key Highlights from the Call Clinical Data Presentation - **Ronacabtagene Autoleucel (Rona-cel)**: New clinical and translational data presented at the 67th American Society of Hematology (ASH) annual meeting [2][6] - **Target Indication**: Rona-cel is a dual-targeting CD19/CD20 CAR T-cell candidate aimed at treating relapsed or refractory large B-cell lymphoma [5][6] - **Clinical Trial Results**: - **Third or Later Line Setting**: - Overall response rate: 93% - Complete response rate: 76% - Median progression-free survival: 18 months [11][12] - **Second Line Setting**: - Overall response rate: 83% - Complete response rate: 61% - 70% of patients with complete response remained in complete response for six months or longer [11][24] Safety Profile - Rona-cel demonstrated a safety profile suitable for outpatient administration: - No grade 3 or higher cytokine release syndrome (CRS) reported - Grade 3 or higher immune effector cell-associated neurotoxicity syndrome (ICANS) rate was less than 5% with dexamethasone prophylaxis [11][29] Competitive Landscape - Rona-cel's clinical data suggests it may disrupt the current CD19 CAR T-cell market, which is valued at nearly $3 billion and projected to grow to over $5 billion [13][14] - Comparison with existing therapies (Yescarta and Breyanzi): - Yescarta: 72% overall response rate, 51% complete response rate, median progression-free survival of 6-7 months - Rona-cel: 93% overall response rate, 76% complete response rate, median progression-free survival of 18 months [12][14] Pipeline Expansion - **LYL273**: A new CAR T-cell candidate targeting guanylyl cyclase C (GCC) for metastatic colorectal cancer, currently in phase 1 clinical development: - Overall response rate: 67% - Disease control rate: 83% at the highest dose evaluated [39][40] - GCC is expressed in over 95% of colorectal cancers, representing a significant market opportunity projected to reach $12 billion by 2032 [43] Manufacturing and Scalability - Lyell operates its own manufacturing facility capable of producing over 1,200 CAR T-cell doses per year, ensuring scalability for clinical and commercial needs [9][40] Future Milestones - Ongoing pivotal trials for Rona-cel (Pinnacle and Pinnacle Head-to-Head) expected to provide further insights into its efficacy and safety compared to existing therapies [30][48] Additional Insights - The importance of CD62L enrichment in Rona-cel manufacturing was emphasized, leading to improved T-cell characteristics and sustained functional capacity post-infusion [31][36] - The call highlighted the need for next-generation CAR T-cell therapies to address limitations of existing treatments, particularly in high-risk patient populations [16][17] This summary encapsulates the critical points discussed during the conference call, focusing on Lyell Immunopharma's advancements in CAR T-cell therapy and its competitive positioning in the oncology market.

Core Insights - Lyell Immunopharma, Inc. announced new clinical data for its CAR T-cell therapy, ronde-cel, showing promising efficacy in treating large B-cell lymphoma (LBCL) with a 93% overall response rate and a 76% complete response rate in the 3L+ setting [1][5][12] - Ronde-cel has received FDA Regenerative Medicine Advanced Therapy (RMAT) designation, indicating its potential as a significant treatment option for patients with relapsed and/or refractory LBCL [2][17] Clinical Data Summary - In the 3L+ setting, 29 patients showed a 93% overall response rate and a 76% complete response rate, with a median progression-free survival of 18 months [4][5] - In the 2L setting, 18 patients, predominantly with primary refractory disease, achieved an 83% overall response rate and a 61% complete response rate [6][12] - Safety profile was manageable, with no high-grade cytokine release syndrome (CRS) and low rates of Grade 1 (32%) and Grade 2 (29%) CRS reported [7][6] Pivotal Trials - Lyell has initiated two pivotal trials: PiNACLE – H2H, a head-to-head trial comparing ronde-cel to other CAR T-cell therapies, and PiNACLE, a single-arm trial for the 3L+ setting [8][10] - The PiNACLE – H2H trial aims to enroll approximately 400 patients and focuses on event-free survival as the primary endpoint [9] Translational Data - Ronde-cel demonstrated robust expansion and high expression of memory-related genes post-infusion, with a higher proportion of CD62L-positive T cells compared to other CAR T-cell products [11] - The product showed up to a three-fold higher expansion in patients after infusion compared to approved CD19 CAR T-cell products [11] Company Overview - Lyell Immunopharma is focused on advancing next-generation CAR T-cell therapies for hematologic malignancies and solid tumors, utilizing proprietary manufacturing processes to enhance T-cell efficacy [18][16]

Product Development and Pipeline - The company is advancing a pipeline of proprietary next-generation autologous CAR T-cell product candidates targeting hematologic malignancies and solid tumors [112]. - The lead product candidate, rondecabtagene autoleucel (ronde-cel), is designed to increase complete response rates and prolong duration of response compared to approved CD19-targeted CAR T-cell therapies [113]. - Ronde-cel is currently in a pivotal clinical trial (PiNACLE) for patients with large B-cell lymphoma (LBCL) in the third-line setting and a Phase 3 head-to-head trial for second-line treatment [114]. - The company acquired an exclusive global license for LYL273, a CAR T-cell product candidate, which reported a 67% overall response rate and an 83% disease control rate in a Phase 1 trial for refractory metastatic colorectal cancer [115]. - The pipeline includes next-generation CAR T-cell candidates enhanced with anti-exhaustion technologies and proprietary manufacturing protocols aimed at improving clinical responses [116]. - Ronde-cel targets NHL subtypes representing approximately 35% of the over 80,000 patients estimated to be diagnosed with NHL in the U.S. in 2025 [120]. - The company aims to submit a Biologics License Application (BLA) for ronde-cel in 2027, with pivotal trial initiation expected by early 2026 for the second-line setting [118]. - Ronde-cel's dual-targeting mechanism is designed to overcome CD19 antigen escape, potentially leading to higher overall response rates [133]. - The manufacturing process for ronde-cel enriches for CD62L-expressing T cells, which is associated with better engraftment and reduced exhaustion, without increasing manufacturing time [134]. - The PiNACLE trial is enrolling approximately 120 patients with relapsed and/or refractory DLBCL, PMBCL, HGBCL, FL3B, or tFL, evaluating ronde-cel at a dose of 100 x 10 CAR T cells [136]. - The Phase 1/2 trial reported an overall response rate of 88% (22/25 patients) in the 3L+ cohort, with 72% (18/25) achieving a complete response [140]. - In the 2L cohort, the overall response rate was 91% (10/11 patients), with 64% (7/11) achieving a complete response [145]. - The Phase 1/2 trial included a safety evaluable population of 51 patients, with low rates of Grade 1 (22%) and Grade 2 (35%) cytokine release syndrome events [149]. - Ronde-cel received Regenerative Medicine Advanced Therapy (RMAT) designation from the FDA for treatment in both the 3L+ and 2L settings [151]. - The PiNACLE – H2H trial is expected to enroll approximately 400 patients, with the first patient anticipated to be enrolled by early 2026 [152]. - The overall response rate for LYL273 in a Phase 1 trial was 50% (6 of 12 patients), with a disease control rate of 83% across both dose levels [154]. - At Dose Level 2 of LYL273, the overall response rate was 67%, with a median progression-free survival of 7.8 months [159]. - The company is advancing a fully-armed solid tumor CAR T-cell product candidate targeting large markets with substantial unmet medical needs [163]. - The next data update for LYL273 is expected in the first half of 2026 [165]. - The first IND submission for a fully-armed CAR T-cell product candidate targeting solid tumors is expected in 2026 [167]. Financial Performance - Research and development expenses for Q3 2025 were $28.2 million, a decrease of $11.3 million from $39.5 million in Q3 2024 [190]. - Total operating expenses for the nine months ended September 30, 2025, were $141.8 million, down from $157.7 million in the same period of 2024, reflecting a decrease of $15.9 million [189]. - The company anticipates an increase in general and administrative expenses to support ongoing research and development activities and compliance with public company regulations [182]. - Interest income for the nine months ended September 30, 2025, was $10.4 million, down from $19.1 million in the same period of 2024, a decrease of $8.7 million [189]. - The company has no products approved for sale and has never generated revenue from product sales, but may generate revenue from collaborations and licensing agreements in the future [175]. - Research activities, collaborations, and outside services expenses decreased by $8.8 million for the nine months ended September 30, 2025, compared to the same period in 2024 [191]. - The net loss for Q3 2025 was $38.8 million, an improvement of $5.7 million compared to a net loss of $44.6 million in Q3 2024 [189]. - General and administrative expenses decreased by $1.1 million to $10.7 million for Q3 2025, primarily due to a $0.8 million reduction in stock-based compensation [193]. - For the nine months ended September 30, 2025, general and administrative expenses were $34.5 million, down $3.0 million from $37.5 million in 2024, driven by a $1.7 million decrease in legal expenses [194]. - Other operating income, net increased by $0.9 million to $1.6 million for Q3 2025, attributed to gains on property disposals and increased sublease income [195]. - Interest income, net decreased to $3.3 million for Q3 2025 from $6.0 million in 2024, and for the nine months, it fell to $10.4 million from $19.1 million, primarily due to lower interest rates [198]. - Net cash used in operating activities was $117.8 million for the nine months ended September 30, 2025, reflecting a net loss of $133.7 million [211]. - Cash provided by investing activities was $85.5 million for the nine months ended September 30, 2025, compared to $68.9 million in 2024 [215]. - Cash provided by financing activities was approximately $50.2 million for the nine months ended September 30, 2025, mainly from the issuance of common stock [216]. - As of September 30, 2025, the company had $319.6 million in cash, cash equivalents, and marketable securities, excluding restricted cash [203]. - The accumulated deficit stood at $1.5 billion as of September 30, 2025 [203]. - The company anticipates needing to raise additional capital in the future to fund operations and product development [206]. - As of September 30, 2025, the company had cash equivalents of $108.6 million and fixed income marketable securities of $196.0 million [223]. - The company had no debt outstanding as of September 30, 2025 [223]. Risk Management and Financial Strategy - The company does not hedge its interest rate risk exposure, and a hypothetical 10% change in interest rates would not have a material effect on its financial statements [223]. - The company is currently not exposed to significant foreign currency exchange risk as all operations are in the U.S. and expenses are generally in U.S. dollars [224]. - Foreign currency transaction gains and losses have not been material to the company's financial statements to date [224]. - The company evaluates freestanding equity-linked instruments for classification and measurement, concluding that the SPA put/call does not qualify for equity classification [220]. - Fair value determination of the SPA put/call involves significant judgment and Monte Carlo simulation models, with potential material effects from changes in milestone achievement probabilities [221]. - The primary objective of the company's investment activities is to preserve capital to fund operations [223]. - The company may contract with non-U.S. vendors, which could expose it to future foreign currency exchange rate fluctuations [224]. - The company has not had a formal hedging program for foreign currency risks [224].

Financial Performance - Lyell reported a net loss of $38.8 million for Q3 2025, a decrease from a net loss of $44.6 million in Q3 2024, primarily due to reduced personnel expenses[13]. - Revenue for Q3 2025 was $15,000, compared to $34,000 in Q3 2024, representing a decrease of 56%[21]. - Total operating expenses for Q3 2025 were $37,268,000, down from $50,539,000 in Q3 2024, a reduction of 26%[21]. - Net loss for Q3 2025 was $38,846,000, compared to a net loss of $44,583,000 in Q3 2024, showing an improvement of 13%[25]. - Non-GAAP net loss for Q3 2025 was $29,124,000, compared to $37,064,000 in Q3 2024, reflecting a 21% improvement[25]. - Cash, cash equivalents, and marketable securities were approximately $320 million as of September 30, 2025, expected to support operations into 2027[17]. - Cash, cash equivalents, and marketable securities as of September 30, 2025, totaled $319,624,000, down from $383,541,000 as of December 31, 2024[22]. Research and Development - Research and development (R&D) expenses were $28.2 million for Q3 2025, down from $39.5 million in Q3 2024, reflecting a $11.3 million decrease attributed to lower research activities and personnel-related expenses[14]. - Research and development expenses for Q3 2025 were $28,172,000, a decrease of 29% from $39,500,000 in Q3 2024[27]. - Lyell plans to submit an IND in 2026 for a CAR T-cell product candidate targeting solid tumors[20]. - The company expects to present new clinical and translational data at the upcoming ASH meeting[20]. Product Development - Lyell's lead product candidate, ronde-cel, is in pivotal development for relapsed/refractory large B-cell lymphoma (LBCL) with a Phase 3 trial (PiNACLE – H2H) expected to begin enrollment by early 2026[3][11]. - The FDA granted RMAT designation for ronde-cel for the treatment of patients with relapsed or refractory LBCL in the second-line setting, enhancing communication frequency with the FDA[9][11]. - The company acquired exclusive global rights to LYL273, a CAR T-cell product candidate for refractory metastatic colorectal cancer (mCRC), which achieved a 67% overall response rate in a Phase 1 trial[4][6]. - The overall response rate for patients treated with LYL273 at the highest dose level was 67%, with an 83% disease control rate observed in the ongoing Phase 1 trial[4][15]. - Two abstracts from the Phase 1/2 trial of ronde-cel have been accepted for oral presentation at the ASH 67th Annual Meeting in December 2025[6][11]. Operational Efficiency - General and administrative (G&A) expenses decreased to $10.7 million in Q3 2025 from $11.8 million in Q3 2024, primarily due to lower stock-based compensation and outside services[16]. - General and administrative expenses for Q3 2025 were $10,687,000, compared to $11,769,000 in Q3 2024, a decrease of 9%[30]. - Lyell's manufacturing facility can produce over 1,200 CAR T-cell doses at full capacity, supporting commercial launch capabilities[18].

Core Insights - Lyell Immunopharma, Inc. reported financial results and business highlights for Q3 2025, focusing on its advanced CAR T-cell therapies for cancer treatment [1] Clinical Programs - The lead clinical program, rondecabtagene autoleucel (ronde-cel), is in pivotal trials for relapsed and/or refractory large B-cell lymphoma (LBCL) [2] - Ronde-cel has received Regenerative Medicine Advanced Therapy (RMAT) designation from the FDA for both second-line and third-line settings [2][8] - Lyell acquired global rights to LYL273, a CAR T-cell product candidate for refractory metastatic colorectal cancer (mCRC), which showed a 67% overall response rate in a Phase 1 trial [3][5] Financial Performance - The company reported a net loss of $38.8 million for Q3 2025, an improvement from a net loss of $44.6 million in Q3 2024 [12] - Research and development expenses decreased to $28.2 million in Q3 2025 from $39.5 million in Q3 2024, primarily due to reduced personnel costs [13] - Cash, cash equivalents, and marketable securities were approximately $320 million as of September 30, 2025, expected to support operations into 2027 [16] Upcoming Developments - Two pivotal trials, PiNACLE and PiNACLE – H2H, are set to advance, with patient enrollment for PiNACLE – H2H expected to begin by early 2026 [4][10] - New clinical data for ronde-cel will be presented at the upcoming ASH meeting in December 2025 [5][10] Pipeline and Manufacturing - Lyell's pipeline includes next-generation CAR T-cell therapies targeting significant unmet needs in cancer treatment [5] - The LyFE Manufacturing Center™ has the capacity to produce over 1,200 CAR T-cell doses, supporting both clinical trials and potential commercial launches [17]