David Wainer's Heard on the Street column may be the single most important pharma column of the year. Revolution Medicines' oral pill daraxonrasib nearly DOUBLED survival vs chemotherapy in pancreatic cancer in a late-stage trial. FDA approval is expected later this year.
Why this matters scientifically
RAS is a protein that drives the majority of pancreatic tumors and contributes to lung and colorectal cancers. Scientists have struggled to drug RAS for 40 years — its surface offers no obvious place for a small molecule to grip. Daraxonrasib bypasses this with a "molecular glue" mechanism that binds to a separate protein and uses the combined surface to seize RAS directly.
Why this matters financially
Recent talks with Merck and AbbVie at a $30B valuation didn't close. Since then, the stock has rallied to nearly that mkt cap; an acquirer would now likely need to pay $40B+. RevMed's recent $2B equity-and-convertible offering signals the company is funding a longer-term standalone path — the Vertex Pharmaceuticals model. Vertex was once a perpetual takeover candidate; it built a dominant cystic-fibrosis franchise and is now worth $100B+.
The competitive landscape just shifted: Erasca — the closest RAS-targeting peer — collapsed 48% Tuesday after a patient died of pneumonia in its trial, and RevMed alleges Erasca's drug infringes RevMed patents. RevMed is now the only credible RAS franchise, with single-product upside in pancreatic and combination-trial optionality in lung and colorectal.
RVMD added — sized for asymmetry
Today we ADD RVMD at 1.5% within the Healthcare sleeve. The asymmetric setup: (a) M&A optionality from Merck (Keytruda patent cliff, $25B in M&A budget already deployed but room for another), Lilly (oncology gap), or J&J; (b) standalone DCF assuming peak pancreatic-cancer sales of $5-7B and 15% pipeline-optionality discount yields ~60% upside from current; (c) Erasca's collapse removes the only credible RAS competitor near-term. Avoid ERAS entirely — safety setback + IP overhang. WATCH MRK for M&A optionality. Hold core HC: UNH, LLY, ABBV.
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