The rise of the new beverage giant KDP

  For decades, cold and hot drinks in the United States have been separate fields, each field dominated by undisputed champions. In the field of carbonated soft drinks, Coca-Cola and Pepsi have long occupied nearly three-quarters of the market share, while Starbucks dominates the coffee market. But in 2020, the U.S. beverage market is as turbulent as other areas of the consumer economy, and an unexpected winner-the little-known Keurig Dr pepper-is grabbing market share.
  Although the size of KDP in the U.S. soft drink market is less than half that of Coca-Cola and Pepsi, compared with the previous year, in terms of the U.S. domestic market alone, it is not the same as the growth of the two giants’ market share in beverage cans and bottled beverages. up and down. According to Consumer Edge data, in the 20 weeks ending July 26, KDP accounted for 34.1% of the US$1.4 billion in revenue growth for all carbonated beverages in the United States. This increased its overall market share from 22.7% to 24.0%. “In response to the crisis, KDP is the best among all beverage companies.” Consumer Edge analysts said.
  The rise of KDP is particularly noticeable because it is a new company formed two years ago by the merger of coffee supplier Keurig Green Mountain and soda maker Dr Pepper Snapple for $18.7 billion. This transaction is a huge bet. KDP hopes to create a stronger business by integrating and promoting a series of classic brands and high-growth new brands.
  With revenue of 11.1 billion U.S. dollars last year, KDP is the seventh largest food and beverage company in the United States. It has monopolized one thing that is elusive for the company (especially during the pandemic): extensive and diversified investments. Combination to create predictable benefits. In the first six months of 2020, the company’s revenue increased by 3% to 5.5 billion U.S. dollars, and its adjusted profit increased by 11.7% to 877 million U.S. dollars.
Britain may fall into a “double dip” recession

The Week UK November 21, 2020

  According to the revised forecast of leading economists, the United Kingdom will fall into a double-dip recession due to the second blockade.
  Looking back on April, the first full month of the first lockdown, the UK GDP shrank by a record 20.4% month-on-month. The stricter restrictions that began on November 5, 2020 will “erase the fragile economic recovery in the UK.” Many people predict that the UK’s GDP will shrink by as much as 8% in the last quarter. Some economic advisers believe that the economic contraction may be as high as 10%.
  Howard, chief economic adviser of forecasting agency EY Item Club? Howard Archer also believes that the new round of national blockade in the UK will “unquestionably” cause the economy to contract in the fourth quarter, and it is likely that the contraction will be considerable.
  It is said that the British Monetary Policy Commission (MPC) is ready to announce “more pessimistic economic forecasts” and will also support quantitative easing to stimulate the economy-in the process, the central bank will create an electronic currency that can be used to purchase the British government Bonds.
  From April to September 2020, the British government borrowed almost four times the amount of 54.5 billion pounds borrowed in the previous fiscal year. At the same time, debt has reached 2.06 trillion pounds, equivalent to 103.5% of GDP, the highest level in 60 years.
Pharmaceutical investment veterans bet on new antibiotics

ForbesNovember 30, 2020

  In 2015, 71-year-old Bob Duggan sold his anti-cancer biotechnology drug company Pharmacyclics to AbbVie for approximately US$3 billion. At the age of 76, he refused to retire. He said: “It is the innate nature of everyone to make a difference and use their abilities. It has nothing to do with age.”
  In April 2020, Duggan acquired over 60% of Summit Therapeutics for approximately $63 million. Shares, became the CEO of this Nasdaq listed company. Summit was founded in 2003 and has not yet announced any meaningful revenue. The company is developing a new antibiotic for the treatment of Clostridioides difficile (C.diff), a common but fatal infection that is spread through feces and often appears in hospitals and nursing homes. C.diff itself can cause severe diarrhea, and in severe cases, it can lead to organ failure or even death. Approximately 250,000 Americans are infected with C.diff each year, of which 13,000 die.
  Antibiotics are one of the greatest success stories of the 20th century. But now antibiotics have two main problems. The first is economic: there are many different antibiotics on the market, almost all of which are cheap generic drugs. For example, Amoxicillin came out in 1973 and is one of the most commonly used antibiotics in the world; after decades of non-proprietary use, each medicine now costs less than $1 and is very effective. Considering that it takes $1.3 billion to develop a new drug, almost no one tries to make a new antibiotic anymore.
  Secondly, when a new antibiotic is finally developed, doctors will reserve it for very serious cases due to drug resistance. Commercially speaking, this means that the new antibiotic is placed in a cupboard but not used. As a result, for large pharmaceutical companies, antibiotic development is usually not worthwhile, while small companies still developing antibiotics are struggling. In the past 18 months, two of Summit’s peers, Achaogen (Duggan holds 15% of its shares) and Melinta Therapeutics have filed for bankruptcy. In the past 20 years, only 25 new antibiotics have been approved, most of which are derivatives of existing drugs.
  None of this can stop Duggan. His investment experience is rich and successful. In 2008, Duggan became the CEO of Pharmacyclics, a cheap stock biotech company. The drug Imbruvica, which was being developed by Pharmacyclics at the time, proved to be a powerful weapon for the treatment of b-cell carcinomas, including chronic lymphocytic leukemia (CLL), which is one of the most common forms of leukemia in adults. This directly led to AbbVie’s $21 billion acquisition.
  Like Pharmacyclics, the fate of Summit depends on a drug: ridinilazole, as a new antibiotic for the treatment of C.diff, is currently undergoing tit-for-tat tests with the universal gold standard vancomycin (vancomycin). A recent phase 2 clinical trial found that ridinilazole is not only superior to vancomycin in the treatment of C.diff, but also has the potential to prevent disease recurrence.
  Allen, Needham’s biotech analyst? Carl believes that if there is a new type of antibiotic that can succeed, it is ridinilazole. Carl said: “C. diff has a very attractive market opportunity.” He pointed out that the price of ridinilazole may be higher because it is a pill, not an intravenous drug, which means it can also be prescribed Patients outside the hospital. But “I don’t think it is a multi-billion-dollar drug. It may sell for hundreds of millions of dollars, but it won’t be a sensation.”