Yo Pit Crazies!

Called Crisper Therapeutics (CRSP) this morning in the State of the Market show – up $6 by close. Here’s why I’m doubling down on the biotech revolution while everyone’s distracted by government shutdown theater.

My thesis centers on what I’m calling a détente between Trump’s administration and big pharma. After the Trump RX website went up, the saber rattling stopped, and innovation money started flowing again.

Here’s just one example of what we can expect, from Mintz.com…

“Pfizer was the first manufacturer to step up to the plate and strike a deal. On September 30, 2025, President Trump announced a landmark agreement with Pfizer to secure several drug pricing concessions. Pfizer has agreed to offer its portfolio of drugs at MFN prices, equal to the lowest prices it offers other developed countries, to every state Medicaid program. Pfizer also agreed to launch new drugs in the U.S. market at the same prices it offers to other developed countries and offer some of its medications directly to consumers at a discounted cash price. In exchange, Pfizer will be exempt from the 100% tariffs described above for three years. Pfizer also committed to channeling $70 billion into research and development while expanding domestic manufacturing in the U.S.”

Meanwhile, Congress is having a meltdown over Affordable Care Act subsidies. This Washington Post Editorial tells you everything about how stuck they are. 

But here’s what everyone’s missing while they obsess over political theater: this gridlock changes nothing for drug company innovation.

I have less insight on the insurance mess – that’s not my game. What I do know is this: at some point Congress will have to reform Obamacare because it just simply costs too much money. It’s distorted the insurance business way too much, as anyone paying premiums knows.

But whatever the insurance issues, innovation doesn’t stop. And that’s where the iShares Biotechnology ETF (IBB) comes in.

Why IBB Instead of Individual Biotech Picks

Investing in individual biotech stocks is hard – I’ll be the first to admit it. But riding the sector through IBB? That’s how you capture the AI revolution in healthcare without the single-stock risk that’ll chop you up.

IBB’s top holdings include the exact companies driving this AI transformation: Moderna (MRNA), Regeneron (REGN), Gilead Sciences (GILD), and Biogen (BIIB) – all heavy in AI-driven drug discovery and personalized medicine development.

Look at the 5-year chart on IBB – we’re basically unchanged for the year while the S&P 500 is up over 20% YTD. That disconnect doesn’t last long when money starts flowing.

The 90-day implied volatility on IBB options is sitting around 25% – well below the biotech sector’s historical average of 35-40%. The market’s not pricing in the move I’m expecting.

The AI Healthcare Angle Everyone’s Missing

AI will change healthcare delivery completely. We’re already seeing it with companies like Tempus AI going public this year, focusing on precision medicine through AI analysis.

Google’s DeepMind just announced breakthrough protein folding predictions that cut drug discovery timelines from years to months.

This technology might even solve some of the Affordable Care Act issues down the road by dramatically reducing treatment costs.

That won’t happen tomorrow, but jumping into a dynamic sector trading flat in a bull market? Those opportunities don’t come around often.

I’m adding more IBB today, and I’ll be going live for Make America Healthy Again (MAHA) next week to break down exactly how this plays out.

To Your Trading Success,

AG