Profits from the Deep

Written by Jimmy Mengel
Posted September 13, 2018 at 1:03PM

The next big medical breakthrough could come from a very unexpected place: the bottom of the sea.

It could be the ticket for the biggest, safest biotech gains you’ve ever seen…

But it wouldn’t be the first major health breakthrough from the ocean depths. Our subaqueous friends have quietly delivered us a number of life-saving drugs. And countless life-changing profits.

Acyclovir — a drug that fights HIV — was born from the Cryptotheca crypta, a sea sponge mostly located in the depths of the Caribbean.

*Courtesy of the Smithsonian Ocean Portal

This strange creature held two amazing chemicals: spongothymidine and spongouridine. These two chemicals were used to develop the first marine-based drug in 1969 — an anti-leukemia drug. It also played a part in the very first HIV drug, which was released in the late 80s.

According to David Newman, a chemist at the U.S. National Cancer Institute, “These are arguably the first marine drugs.”

HIV drugs are expected to hit $26 billion by 2022.

Prialt is a current treatment for chronic pain. It is based on venom from a species of Pacific cone snail — or Conus Magnus (The Magical Cone).

This tiny creature is deadly; they have killed dozens of people with their spiny little stingers. Those stingers contain toxins that have been transformed into Ziconotide, a substance said to be 1,000 times more powerful than morphine…"magic cone" indeed.

Not only is it more effective, but it also doesn’t have the same addictive qualities as opioids like morphine.

The chronic pain industry is projected to hit $83 billion by 2024.

Even recognizable creatures, like the seahorse, are used to treat aliments as serious as kidney disease. Every year, over 20 million seahorses are caught and harvested to treat disease.

I could go on about the quiet powers of the sea and their unsung value to modern medicine. But I’m here to talk about one ancient creature that could dwarf all of these discoveries…

If you've been to the beach on the East Coast, you've seen one of these bad boys...

It's the humble horseshoe crab... I remember the first time I saw one flipped upside down in Ocean City, Maryland. I thought I stumbled upon an alien landing. I flipped it back over and sent him back into the sea. But I was still weirded out...

Horseshoe crabs are still considered "living fossils" since they've been around for some 450 million years; a pretty good run if you ask me. But creatures don't hang around that long if they aren't valuable in some way.

They’re ancient, they're hideous, and almost no one (outside some Asian countries) wants to eat them.

But despite all of that, the entirety of modern medical practices is hopelessly dependent on them. Therefore, so are we. All of us. Just about the only reason there is such a low risk of infection whenever you get a shot, have surgery, or have a wound treated is because of their blood.

Unlike mammals, who use iron-based hemoglobin — or red blood cells — to transport oxygen to our cells, horseshoe crabs use hemocyanin in a semi-closed circulatory system. In other words, they use copper in a circulatory system that would probably lead to all of us hemoglobin users dying of terrible blood-borne infections.

Horseshoe crabs can pull this off by producing remarkable biochemicals called amebocytes that function as a powerful antibacterial immune system. Think of conditions like pneumonia, E. coli, and virtually all of the bacteria developing strong multi-drug resistances.

The weird just keeps piling up here, too. These cells move themselves around like amoeba, using arm-like extensions of the cell to drag themselves around within the horseshoe crab. By capturing and harvesting this blood and isolating the amebocytes, companies can produce Limulus amebocyte lysate (LAL).

This "blue blood" is worth an astounding $60,000 a gallon.

That's because any medical device that comes into contact with the inside of your body or your blood has been screened for dangerous infectious diseases with LAL. 90% of FDA-approved drugs require such testing...

In the U.S. alone, the medical device market is worth $148 billion and this figure is expected to grow to $173 billion over the next year.

Prescription drugs are an even bigger business. Spending in that sector jumped 12% in 2015, reaching a record $425 billion for the year... and this figure is expected to push $610 billion over the next year or so. "Blue blood" will be in heavy demand...

One company has completely cornered the market on LAL. It could quietly become the biggest biotech stock story of the next decade.

You need to see this to believe it...


Jimmy Mengel

follow basic @mengeled on Twitter

Jimmy is a managing editor for Outsider Club and the investment director of the personal finance advisory, The Crow's Nest, and cannabis stocks advisory, The Marijuana Manifesto. For more on Jimmy, check out his editor's page.

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