The Supreme Court’s $30 Billion Profit Ruling

41 | By Michael A. Robinson

It’s a potential $30 billion market.

And the U.S. Supreme Court has just handed it a victory.

Trouble is, almost nobody understands this but us.

Now you’ll know it, too.

And we’re going to show you how to use this new knowledge for profit.

On June 13, the nation’s high court ruled 9-0 that human genes cannot be patented.

Basically, the Supreme Court justices said that because genes and human DNA are part of nature, they belong to the whole human race. Just isolating a gene – no matter how difficult or expensive the process may be – does not warrant a firm a patent.

This decision is an important one for biotech investors for a simple reason: Industry patents serve as the key barriers to entry that keeps competitors at bay. And that can boost the patent-holder’s profit margins and stock price.

No wonder investors in Myriad Genetics Inc. (NasdaqGS: MYGN) have been so hard hit. Shares of the mid-cap firm are off by nearly 20% since the court issued its ruling.

Myriad had patented two genes, known as BRCA1 and BRCA2. Mutations in these genes show a high likelihood for breast cancer in women. A positive test means there’s a 50% to 80% likelihood of getting breast cancer.

The mid-cap firm maintained a monopoly on the screening process. It was the one that leading-lady actress Angelina Jolie recently used to decide to undergo a double mastectomy as a preventive measure.

No doubt, Myriad’s stock will remain under pressure for some time. And some other biotech concerns heavily steeped in gene-related products and services could be affected as well.

But there’s one field that will benefit greatly from the high court’s decision.

You see, the justices ruled that artificial genes and DNA – the manmade versions created in the lab – do qualify for patent protections.

That’s why I believe this is a big victory for synthetic vaccines, the kind that are artificially created in the lab.

This is a sub-sector of the biotech industry that could save millions of lives around the world.

And it will make savvy investors – those who understand this – boatloads of money.

In fact, when you add the value of all the vaccines given today for flu, chicken pox, polio and more, it totals some $30 billion a year.

And there is one firm that is uniquely set to profit from the huge growth we’re expecting for this emerging field.

Novartis AG (NYSE: NVS) entered the synthetic vaccine field back in 2010. The company joined forces with Synthetic Genomics Vaccines. The privately held firm is the well-regarded spinoff from Craig Venter’s pioneering work in sequencing the human genome.

Under a three-year deal, Novartis is creating synthetic “seed” viruses to combat flu epidemics. From the seeds, the team hopes to be able to create big batches of synthetic vaccines in as little as a few weeks.

And that faster “time-to-market” capability ranks as one of Novartis’ big competitive advantages. Current technology now requires at least several months to get the gene sequence for a new virus and make a vaccine to treat it.

This actually is one of the biggest disconnects in science today. As the rest of the world moves at warp speed, vaccines are still mainly created much as they were decades ago: They are “grown” in chicken eggs.

The process leaves us vulnerable to the emergence of a new virus…

Take the outbreak of a new respiratory disease known as the coronavirus MERS-CoV. It has so far sickened 49 people in the Middle East. Of those, 32 have died.

Because of the slow pace of current technology, there’s little chance that a new organic vaccine needed to combat a new “threat” could be on the market in less than several months – if at all.

Back in 2003, the SARS virus sickened 8,000, killed nearly 800 and cost the global economy billions. There still is no vaccine.

But Norvartis hopes to rewrite the rules of vaccine science…

Backed in part by federal funding, Novartis built a $1 billion plant in Holly Springs, N.C. In late 2011, the company said it had begun making a stockpile of vaccines at the federal government’s request.

The stockpile could be used without the U.S. Food and Drug Administration’s usual approval process in the event of a surprise outbreak of a deadly flu strain. That would sidestep another biotech bottleneck – the many years it often takes for the FDA to approve new products.

Novartis is making big waves with this work. Just last month, the company served as a case study on the benefits of synthetic medicine at a key meeting at the renowned Massachusetts Institute of Technology (MIT).

There, a top Norvartis researcher said that two years ago the firm synthesized a hybrid flu genome in just a few days. To do so, it grew the virus in a culture made from mammalian cells, rather than chicken eggs.

Then last November, Novartis became the first firm to win FDA approval for cell-grown vaccines. The company named the new product Flucelvax and said it ranks as the “most significant advancement in influenza vaccine manufacturing in more than 40 years.”

Indeed, vaccines and diagnostics comprise one of the health company’s six main business groups. Last year, the division pulled in nearly $1.7 billion and has some 20 products on the market.

With a market cap of $180 billion, NVS trades at about $73 a share. Its valuation – a forward Price/Earnings (P/E) ratio of 13.5 – is roughly in line with the broader market. It pays a dividend of 3.5%.

This is much more of what I call a “foundational play.” It likely won’t have the huge shorter-term gains you see with tiny biotechs. But it should generate some nice longer-term returns, and will pay you a nice income as you hold it.

Moves like this will give Novartis shares a bigger upside than Wall Street realizes. And having some big-cap stocks that deliver consistent growth and pay nice dividends in your portfolio can serve as a substantive foundation for the more-aggressive plays in the low-priced stocks we’ll continue to find for you.

With Novartis, you also have one of those rare chances to own a steady stock that enables you to tap into an exciting new field of science.

You can accomplish both tasks without all the huge risks you take with shares of small but very thinly traded firms.

By combining the strategies we’re teaching you, you’ll be able to use technology investments to build the kind of net worth most folks only dream about.

Editor’s Note: Your feedback is very important.  As always, I welcome your comments, questions and suggestions. Post a comment below … I look forward to hearing from you.

41 Responses to The Supreme Court’s $30 Billion Profit Ruling

  1. Earll Larsen says:

    I have very little money to play with but certainly would appreciate the opportunity to make some.

  2. John J Woods says:

    I don’t currently hold Norvartis stock but I am considering such a purchase. This strikes me as a genuine medical breakthru.

  3. Marie Banks says:

    I am not sure about how to buy shares and at the price they are selling for at the time. How many shares do you have to acquire at one time to be eligible? Can I buy just one or do I have to buy an allotted number? Can you please reply?

    • Chris says:

      Marie I suggest you either consult a stock broker to help you (for a fee), or search the internet for websites that offer software you can use to buy and sell stocks online (much cheaper, but you still pay a small commission, less if you shop around the internet). Either of these option will help provide you with all the info you need.

    • wilma says:

      I whole heartedly agree this could be a great windfall for our future retirement . I am anxious to know more about this new technology and how to invest. Its a smart way to build a nest egg. thanks please help us get started.

    • Jim Libs says:

      You can buy as many shares as you want. There is no “eligibility”. Novartis (symbol NVS) closed Friday at $69.60 per share. You have to pay a commission when you buy and when you sell so it’s best to buy a number that you can spread that commission cost over all the shares. It doesn’t make sense to buy just one share.

  4. Pamela Smith says:

    Do you help someone, like me to get into this, even when we’ve never done this at all, and even when we have limited income to start?
    Thank You,
    Mrs. Pamela J. Smith

    • Mrs. Shirley Carini says:

      You can go to Yahoo! then click on finance. There’s a spot to enter the stock symbol. If you don’t know the symbol try just entering the name. If that doesn’t work try the google search line to get it. You should be able to see the current asking price for a share of stock. Maybe with that info you candecide how many shrares you want to purchase. If you haven’t purchased stock before, use a broker. Discount brokers don’t charge a lot and will help you with what you want to order. Enjoy your new experience.
      When you are on the site where you got the price, there are places to click to get more info about the company and the stock

  5. Anthony Cacciottolo says:

    With a 3.5% dividend this may not prove a very attractive inverstment
    Being a relative newbie in invetstments in the US I would certaihly welcome any comments on this. Thanks for your kind and valuable articles and best regards to everbody.


    I have just recently started receiving your informative e-mails and this recent one concerning NVS sounds like the kind of company I would be interested in investing, Thank you for the mail and please continue to send more.

  7. John Ivens says:

    No Flu vaccine has ever proved to be effective in the past 50 years. It’s all a scam. Vitamin D is far more effective in preventing flu and also prevents 77% of cancers Why don’t doctors tell you that? Nor do they mention the amount of Mercury still in the vaccines. 17 times the max dose for a 3 year old, for instance.

  8. Chris says:

    I’m a fan of Michael Robinson’s tech articles, but when it comes to Biotech firms you need to be very careful. There is a huge difference of opinion in the scientific world when it comes to flu vaccines, and growing opposition from average people too. This is not just over the link that some suspect exists between autism and flu vaccines. Even if that is pure rubbish, there are many other concerns around flu vaccines, especially around the toxic additives and preservatives added to them (such as formaldehyde and – mercury, a supposedly less toxic form we are told). Merucy is a potent neurotoxin and how long, or short it remains in the body doesn’t matter much in my opinion. These are just a few examples of what we are being injected with. The effectiveness of the flu vaccine and possibly others too, have also been hugely exaggerated.
    naturalnews. com/033998_influenza_vaccines_effectiveness.h tml

    We need to be very careful when buying into huge, but corrupt biotechnology companies. In the short term (while they fund and rig clinical trials in their favor – such as with Monsanto, bribe regulators and twist the truth in their massive advertising campains and influence over non-profit organisations), they look like great investment opportunities – and they probably are. However the truth eventually catches up with them, and not just when their toxic drugs get recalled from the market, or when they loose important court cases.

    The “big catchup” is likely still coming. People are becoming increasingly aware of their shenanigans and the poorer they get in these worsening economic times, the less they can afford the toxic drugs of Big Pharma. People are waking up to cheaper, safer, more natural cures that cannot be patented. An example is colloidal silver and garlic to fight flu. Colloidal silver is going to be the leading replacement once we run out of new drugs to fight antibiotic resistant bacteria. The more this happens the sooner we will see a very big collapse of the pharmaceutical industy and Obamacare.

    This will be a wonderful day for consumers and every day American’s.
    It’s won’t be so wonderful for investors.
    So get out now, or at least reduce your holdings while you still can.

    One of my few exceptions is (possibly) stem cell companies?
    Any other suggestions?

  9. Jayne says:

    Thank you, Michael, for this very informative, well reasoned and well researched analysis…I never would have connected the Court’s ruling to an investment opportunity!!…I like it!…I like it!…
    and will definitely follow up on this brilliant idea!!

  10. Betty Jean Pearson says:

    What is the current stock price? Is it a publically traded stock? How many shares do I have to buy to hold stocks?

    • Michael Robinson says:

      Hi Betty Jean,

      Yes, Novartis is publicly traded. To check on this you can go to Google or Yahoo finance and put in the ticker symbol NVS. From there you can get stats on the stock and company. To my knowledge there is no minimum number of stocks you need to buy unless a particular broker happens to have a minimum dollar amount or shares for an order. Hope that helps,


    • Michael Robinson says:

      Hi Pearl,

      Thanks for contacting me. You sound very savvy about investing and trading. However, because of the risk nature involved, my Strategic Tech Investor does not typically go into details on options. I ususually confine discussin of option trading for my advanced investing service called Radical Tech Profits. If you’re interested in learning more about this service, just go to:



  11. Richard Delango says:

    I’ve been working for 27 years and have contributed to my deferred comp plan. I’ve always had primarily secured funds and was now looking in diverting part of my investments elsewhere. I was wondering how to go about redirecting these funds. Do I need to contact a broker?

    • Harold Black says:

      Hi Richard
      Brokers are needed for placement of stocks–Etc. so first get a Broker through any of the known brokerages.
      Please get an discount brokerage to save money, Then get all the free info you can from the internet, and make it a self directed account.
      This way you save money also you will learn this trade slower, and this is not a game that you need to hurry, This is where new persons need to look, Study do not let your emotions run your trading.
      Letting a Broker play with your money” calling the shots is a big no no.
      Yes there are a lot of good Brokers out there, but they are expensive and you need a lot of Money
      I hope you understand what I’m saying, you may email me if you wish.——–Harold

  12. Louise says:

    I ‘d like to know about the Novartis shares too, and how to buy them, the price,
    and whether you can buy just a few shares. Or is there a minimum amount?

  13. Betty Belshe says:

    My son passed away at 25. He was a tissue donor, I am sued for all I have for debts for him. I would love to make some money.

  14. Rachel Batey says:

    I am very interested in gaining financial independence. Any advice and knowledge that you share with me would be appreciated very much. Thank you! Have a good day.

  15. Leonard says:

    Buy NVS Novartis, then as it starts to go up or down buy more, dollar averaging,and/write covered calls. CHEERS

    • Michael Robinson says:

      Hi Darlene,

      To my knowledge I don’t believe you are going to be able to avoid broker’s fees. The main you will need to do is decide if you are going to run your own investment portfolio or turn to a “pro” to manage your money for you. There are a lot of discount brokers out there with pretty low fees. Good luck with your investing,


    • Michael Robinson says:


      That’s a great question, and I’m glad to see you are investing for the long haul. In regards to Novartis’s potential DRIP, I checked the investor section of the firm’s website and didn’t get a hit. You can try the National Association of Investors Corporation to see if they can get you started. Also, remember, you can tell your broker to automatically reinvest all dividends. I hope that helps,


  16. Chris says:

    I advise you all to think carefully about Biotech companies. Monsanto is a good example the masses are not going to tolerate their behavior for much longer. Invest in companies making colloidal silver and natural medicines, smaller profits, but safer in the long term.

  17. Harold Black says:

    Everyone has given you good advice about discount brokers, they are cheaper, and you need to learn how to self direct your money, most brokers will lose you money.
    There is good info on the internet that you can learn from.
    One thing that I strongly about is Do not let your emotions get in the way do your testing on a paper trading platform before you trade.
    Many brokers have this option for you to learn trading, and don’t trade for real until you start to make money on paper, get up to at least 40%to 50% good trades at least.

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