Welcome back to Money Movers. Take a look at the XBI biotech ETF on pace for its best year since 2020. And news breaking earlier from the Wall Street Journal that Johnson and Johnson is looking to buy Protagonist Therapeutics.Our ne next guest is a top shareholder in Protagonist and a longtime investor in the biotech space. Joining us now, RTW Investments managing partner and CIO, Dr. . Rod Wong.Dr. . Thank you for being here today. Um, so there's been a a string of acquisitions in this space in in recent w ...

Core Viewpoint - Celularity Inc. has successfully restructured its balance sheet by retiring all senior secured debt amounting to $32.0 million and associated unpaid interest of $9.6 million through an Asset Purchase Agreement and a License Agreement with Celeniv Pte. Ltd. [1][4] Financial Restructuring - The company sold its intellectual property assets to Celeniv for $33,812,230, which was utilized to pay off a $27 million senior secured loan and a $6.812 million Promissory Note [3][5] - The restructuring has resulted in the complete removal of senior secured debt, which was due for repayment in February 2026, enhancing the company's financial flexibility [4][5] Agreements and Options - Under the License Agreement, Celularity retains exclusive rights to use the intellectual property for an initial term of five years, with options for renewal and repurchase [2][4] - The company has an exclusive five-year option to repurchase the assets from Celeniv, providing additional strategic flexibility [2][4] Internal Restructuring - Celularity has established operating subsidiaries for its four commercial business units: advanced biomaterial products, longevity-focused cellular therapeutics, biobanking services, and contract manufacturing and development services [5][6] - This internal restructuring aims to optimize efficiency and financial performance across its commercial units [5][7] Company Overview - Celularity Inc. focuses on developing, manufacturing, and commercializing advanced biomaterial products and cell therapies derived from postpartum placenta, targeting age-related and degenerative diseases [8]

Company Performance - Xencor reported a quarterly loss of $0.41 per share, which is better than the Zacks Consensus Estimate of a loss of $0.78, and an improvement from a loss of $1.07 per share a year ago [1] - The quarterly report represents an earnings surprise of +47.44%, having surpassed consensus EPS estimates three times over the last four quarters [2] - The company posted revenues of $43.61 million for the quarter ended June 2025, exceeding the Zacks Consensus Estimate by 116.92%, compared to revenues of $16.96 million a year ago [3] Stock Performance - Xencor shares have declined approximately 65.4% since the beginning of the year, contrasting with the S&P 500's gain of 7.1% [4] - The current consensus EPS estimate for the upcoming quarter is -$0.77 on revenues of $20.95 million, and -$3.08 on revenues of $96.4 million for the current fiscal year [8] Industry Outlook - The Medical - Drugs industry, to which Xencor belongs, is currently ranked in the top 34% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [9] - Another company in the same industry, Plus Therapeutics, is expected to report a quarterly loss of $0.09 per share, reflecting a year-over-year change of +87.3%, with revenues projected at $1.7 million, up 32.8% from the previous year [10]

Core Viewpoint - Plus Therapeutics (PSTV) has received an upgrade to a Zacks Rank 2 (Buy), indicating a positive trend in earnings estimates which is a significant factor influencing stock prices [1][2]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on the correlation between changes in earnings estimates and stock price movements, making it a valuable tool for investors [2][3]. - Institutional investors utilize earnings estimates to determine the fair value of stocks, leading to price movements based on their buying or selling activities [3]. Company Performance Indicators - The upgrade for Plus reflects an improvement in the company's underlying business, which is expected to positively influence its stock price [4]. - Over the past three months, the Zacks Consensus Estimate for Plus has increased by 78.7%, indicating a significant upward revision in earnings expectations [7]. Zacks Rank System - The Zacks Rank system categorizes stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks which have averaged a +25% annual return since 1988 [6]. - Plus's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting a strong potential for market-beating returns in the near term [9].

Investment Rating - The report indicates a significant transformation in the biotech VC ecosystem, highlighting a complete boom-bust-reset cycle from 2012 to 2024, with a return to 2012 funding levels, suggesting a cautious but potentially sustainable investment environment moving forward [4][25]. Core Insights - The biotech VC ecosystem experienced dramatic growth from $12.1 billion in 2012 to a peak of $152.3 billion in 2018, followed by a correction to $12 billion in 2024, indicating a full market cycle [4][9]. - Specialist biotech investors have regained dominance, capturing 72% of all biotech VC in 2024, reversing the trend where generalists dominated during peak years [4][19]. - The share of biotech in total VC funding has decreased from 19% in 2012 to just 6% in 2024, reflecting a broader reallocation of capital away from biotech [4][16]. Summary by Sections Biotech VC Fund Ecosystem - The biotech VC ecosystem underwent significant changes from 2012 to 2024, characterized by explosive growth and subsequent market corrections influenced by scientific advances and economic shifts [5]. Biotech VC Capital Flows - Fundraising in biotech VC peaked at $152.3 billion in 2018 before declining to $12 billion in 2024, completing a full market cycle [4][9]. - The three phases of funding included steady ascent (2012-2017), explosive expansion (2018-2021), and market rationalization (2022-2024) [10][12]. Regional Biotech Investment - North America dominated biotech VC fundraising in 2024, raising $9.6 billion, which accounted for 80.5% of global capital [47]. - Europe and Asia raised $1.7 billion and $0.6 billion respectively, indicating a concentration of investment in established markets [48][49]. Biotech Capital Concentration - The distribution of fund sizes in biotech VC shows a trend towards larger funds, with those in the $500 million to $1 billion range representing $4.2 billion in 2024 [71]. - The therapeutic complexity and expansion of investment scope are driving capital concentration in larger funds [73][74]. Biotech Investment Returns - Biotech funds have shown strong interim results with an IRR of 11.9% from 2021 to 2023, contrasting with non-biotech returns of 0.3% [92]. - The performance of biotech funds has been cyclical, with periods of outperformance compared to non-biotech funds [87][90]. Outlook - The biotech VC market is establishing a more sustainable foundation for future innovation, with LPs favoring established managers and strategic deployment in a price-sensitive market [115][116]. - Emerging trends include investment in next-generation therapeutic platforms and cross-domain technology integration, indicating a shift towards more innovative approaches in biotech [118][120].