September 5, 2023
The louder he spoke of his honor, the faster we counted our spoons. — Emerson
This article consists of several sections:
Jim Cramer’s June 2015 CNBC interview with Vivek Ramaswamy on the occasion of the Ramaswamy’s IPO of stock in Bermuda-based Roivant Sciences, LLC, the largest biotech IPO in history, bringing its market capitalization to $2.87 billion overnight.
Relevant details from an SEC required legal prospectus associated with that IPO registration.
Ramaswamy’s September 1, 2023 The Knives are Out video, responding to recent allegations of fraud associated with his past biotech career.
The intent behind this trilogy is to allow you to track the versions of Mr. Ramaswamy’s narrative over the course of time, to see if his story changes. Readers should orient themselves to previous relevant videos in this series:
Will the Real Vivek Please Stand Up — Part 2: How to become a billionaire.
Will the Real Vivek Please Stand Up — Part 2.1: Vivek responds to Kevin’s allegations.
Future articles may address additional details in this narrative, including attempting to verify the alleged profitable pharmaceuticals mentioned in the 2023 video and whether, as the Biotech Boy Wonder (BBW) maintains, he did not profit from the failed RVT-101 Alzheimer’s medication.
As always with our subject, be alert whenever he uses “actually” or “actual.” It could precede his windup for a curveball.
2015: JIM CRAMER — Well what the heck are we supposed to make of this breathtaking Axovant Sciences today, with the stock trades under the symbol AXON, rocketing 99.3% higher on its first day of trading, in a deal which what some are calling the biggest biotech IPO ever. Now you guys know that I've been a big fan of some of the smaller development stage biotechs, even if they can be very risky. Think Receptos, which is up more than 15% since I last highlighted it a week ago. But after this monster move in Axovant, which came public at 15 this morning, and is now trading just under 30. We want to be sure the things haven’t gotten a little too ahead of themselves. Perhaps the group — yeah well we got to see. Cuz you know I don't like it when it's too hot.
Axovant has just one drug in the pipeline, it's RVT-101. It's an orally-administered therapy designed to improve cognition in patients with Alzheimers, which the company acquired from GlaxoSmithKline for a $5 million upfront payment last December. In a Phase 2 study the drug helped alleviate the symptoms of Alzheimer's, but it didn't actually change the course of the disease. It's worth mentioning that the clinical trials have been viewed with some skepticism. Although the strength of the IPO says it doesn't pay to be too skeptical, at least when it comes to getting in on a deal. Now Axovant plans to move this drug into Phase 3 trials later this year. And yes, if everything goes perfectly, then there could be a very compelling story.
However we always have to remember, because we talked about this Alzheimer's for a lot on the show. Investors have a long history of getting burned by potential Alzheimer's drugs that had attractive Phase 2 data. but never actually made it to the market. And given that Glaxo sold this drug for $5 million upfront, along with some milestone payments and royalties later on, you have to wonder if it should be worth $2.87 billion.
That's the current valuation of Axovant after today. And if you're today but then again as we said on many occasions, you can truly hit it big and biotechland with the right new drug. So let's take a closer look with Vivek Ramaswamy. He's the CEO of accident Axovant Sciences. Learn more about his newly public company. Mr. Ramaswamy, welcome to Mad Money.
Very good to see you.
Okay Vivek, did meet you before at school, I know your alma mater. You're a summa laude graduate, congratulations.
Thank you, good to be back.
Okay, tell me why Glaxo kind of wrote this drug off, and yet you have such great hopes for it. [Cramer got straight to the point and asked what we are still waiting to learn eight years later. This question has never been legitimately answered and never will be.]
So obviously, I can't speak for other companies other than Axovant. But what I can tell you is that our RVT-101 is a unique drug that we actually think could help millions of patients with Alzheimer's disease. Our focus is actually on the trait, on the treatment of Alzheimer's disease dementia, and other forms of dementia.
We've actually put together what have you as a top notch team in the industry, involving the developer of the most widely used drug to treat Alzheimer's disease. Who actually led our due diligence on this asset and actually will lead our development program going forward. And actually on our board of directors is the former head of neurosciences from GSK that actually led the development of this drug, who sits on our board right now. And all of those individuals are every bit as excited as we are about what we've seen so far.
Walk us through what we’ve seen so far, because we know, as I said, there's a bunch of companies that have gone to Phase 2 and we get so excited, but then it doesn't work out in Phase 3. Why do you think you're ahead of those other companies that have never been able to bring that to market?
That's a great question. And the thing in Alzheimer’s disease to remember, and we remember this all the time at Axovant, is we don't fully understand the way the actual underlying disease works. Not just us at
accidentAxovant, but the field more generally. But the thing with our RVT-101 is it's actually a neurotransmitter targeted therapy that actually in part works through the release of acetylcholine, which is already known to be an effective mechanism of action. Because that's actually very similar to how the currently approved drugs work and so the way the drug works has been demonstrated in clinical trials.In a large Phase 2B study with 684 patients — multinational double-blind placebo-controlled study — and this is the key on the pre-specified analysis, not some type of reanalysis or subgroup analysis, but on the pre-specified analysis the drug actually demonstrated statistically significant improvements in both cognition and in function out to 24 weeks in a way that was maintained out to a full year in time. So that's actually what we think makes this such an exciting opportunity, in addition to its safety and tolerability profile. It's a really well-tolerated drug and you take it as one pill, once a day. And we think that, we're very excited about this development going forward.
Okay, well let's look at it, and we have to be skeptical. You were a former hedge fund manager. I would always be nervous when I would see a stock that would be as hot as this one. I don't believe you have anything else right now in the pipeline. If you were a hedge fund manager, when you’d gotten shares in the stock and you just had seen accident Axovant, and said, would you have rung the register today? [i.e., cashed out when the suckers public bought the sizzle]
So you know, I can't I can't comment exactly on my investor seat, because right now I'm actually thinking about this as the person who's developed this. What I can tell you . . .
Of course, if I were a hedge fund manager and I got it, I would have said: “geez that was a home run.”
So let me actually, let me actually speak directly to it then. I actually think the potential opportunity here is, is really tremendous for delivering value to patients. There's over five million patients who suffer from Alzheimer’s disease in this country alone. And if you think about it, we own global rights to a drug that has already demonstrated, in a large phase 2B study, efficacy in the two parameters that the FDA has historically required for new Alzheimer’s disease drugs. And actually, we're only one, we believe, we're only one additional phase 3 study away from the approval of this drug.
And how long do you, what do you think, what has been the course that the FDA wants for Phase 3 — six months, a year, two years? What have you seen, because you know it takes a long time.
Yes, so historically actually, all of the currently approved drugs for Alzheimer's disease were generally approved on the basis of 24 to 28 week data, and that's what we think is going to be the consistent requirement going forward as well. So our plan phase 3 trial, which we intend to start later this year, in the fourth quarter of this year, is going to be a study that's approximately six months in duration. And based on the phase 2B data, which was already, as I mentioned, showed efficacy on cognition and on function, we think could have a meaningful opportunity in a Phase 3 study.
There was something that was different when I went through the S-1, which was that there were two hedge funds, I think, that had a shorter lockup time. Is their way to change that so they have the same time as everybody?
Actually let me speak to something that's such a great point to clarify. So, the two investors that had indicated an indication of interest on the cover were actually not insiders, that is to say existing investors. These were new investors who actually agreed to a restriction above and beyond what the other investors in the, in the IPO agreed to.
I’m glad you cleared that up. Because I know that people, when they see a red hot stock, when I see a red stock I don't want to get people hurt, you know that. And it's gonna, you know, you got one drug, and you know everyone hopes that it works.
Absolutely, I think you're asking all the right questions, exactly.
Fair enough. Okay, well we're gonna be following this situation and I think you know — look I just hope the drug works.
Absolutely. We're looking forward to it.
Everyone wants to win. Okay, that's Vivek Ramaswamy, he's the president, CEO of what may be the most successful biotech, or the biggest biotech offer of the year, most certainly. That's accident Axovant Sciences. Please do some homework. Go through plenty of documents.
[END TRANSCRIPT]
Note what was said and what was not said. Ramaswamy mentioned the stellar people on his board. He did not mention any clinical evidence or scientific rationale for why the drug they had purchased months previously was now suddenly about to become a blockbuster worth billions, just as soon as they did one more human trial. To his credit, Cramer had clearly done his homework ahead of the interview and his skepticism was well-placed. He obviously has seen this movie many, many times before, leading to his objective skepticism. Cramer asked the right questions. He was also legally bound to urge investors in his audience to exercise caution and due dilligence.
2023: The Knives Come Out video transcript
Gone is any mention of “exciting” eight years after the 2015 IPO.
Are the walls closing in on our hero?
VIVEK RAMASWAMY—Sept. 1, 2023. Hey guys, we are continuing to surge in the race and that means the knives are continuing to come out. So we're going to keep debunking the myths as they come up. Because I think it's important to be transparent and address criticisms as part of what it means. If you can't handle the heat, you stay out of the kitchen. And I'm running for president of the United States. So we're going to address any of these criticisms as they come out.
A couple of the favorites from the last couple of days. One is this funny, relatively old, hackneyed one that they're pulling back out — that I somehow made a lot of money off of some failed Alzheimer's drug. Wrong. Actually you know what is true, is I did develop a drug for Alzheimer's disease, and like 99.7% of drugs that have ever been tested for Alzheimer's, thousands of other drugs, mine was one of the many that also didn't work. That's just a fact of life.
If you're developing medicines, some of them aren't going to work. And in the area of Alzheimer's disease, almost none of them work. Now the mythology is somehow that I made money off this failure. That's wrong. My company Roivant set up a subsidiary Axovant that Roivant could have sold shares in. That I could have sold shares in before that failure. We didn't. In fact, many people would call that honorable. [Actually, others might call it something far from honorable.] That was extremely painful to me when that drug failed.
So how did I make my money then? Well it turns out that I worked on a number of other medicines, five of which are FDA approved today. One for prostate cancer, another for endometriosis and uterine fibroids, another for psoriasis, another for overactive bladder, another for a rare genetic condition in kids — where 20 kids a year are born with a genetic disease where 100% of them die by the age of three. And with treatment, a majority of those kids can live lives of a normal duration.
Actually, according to Yale Professor Jeffrey Sonnenfeld:
The facts are that Ramaswamy’s own tax returns show he opportunely sold out of nearly $40 million of Roivant stock right as Axovant’s hype was peaking. Meanwhile, Roivant was raising $500 million driven largely by Axovant. As Ramaswamy was busy selling his own personal stake, Roivant gradually reduced and diluted its Axovant stake from 78% to just 25%.
I'm proud of those accomplishments. That was part of how I had success in the world of biotech. Yes, that is how you actually create value and make money without apologizing for it. And what I teach young people across this country is, you know what, you're going to go through hardship. Not everything you do is going to succeed. But hardship isn't the same thing as victimhood. Hardship is what teaches you who you are. That worked for me and that's what's led me to success. Not just with Roivant, which is a nearly $10 billion publicly traded company today. Which is the one that I founded and built from scratch. But several other companies, like Chapter and like Strive, other successful companies that I've founded since then, as well.
So I'll be happy to, you know, take my entrepreneurial background and business background toe-to-toe with anybody else. I'm proud to have done that by the age of 38. And it's one of the experiences that'll allow me to succeed as chief executive of this country, as the next president.
Another lie that I've sort of been humored by, floating around, is this position that I'm somehow anti-Israel. That's just dead false and reflects the desperation of, frankly, some other candidates who feel like their fundraising might be lagging. And so they need to figure out how to attack me as a way to raise funds. That's what they seem to be doing. The fact of the matter is our relationship with Israel will be stronger by the end of my first term than it ever has been. Actually, I was just talking about my company. Turns out one of the founding investors in my company was actually an Israeli firm. I've been to Israel many times. I have deep respect for Israel, and I think our friendship with Israel is going to continue to a higher level when I'm the U.S president. Because I'll treat it as a friendship, not as just a transactional client relationship.
Mark Levin took strong exception to Ramaswamy’s narcissistic Israeli, and overall Middle Eastern, policy proposals, a recipe for international chaos.
What does that mean? I'm going to lead Israel diplomatically into Abraham Accords 2.0 in my capacity as U.S President. That'll be a great diplomatic accomplishment, get Saudi Arabia, Oman, Qatar, Indonesia into that pact. Further partner with Israel, to make sure that Iran never, ever becomes a nuclear powerhouse. Never becomes nuclear armed. We got to make sure of that. But I also want to learn from Israel. Israel has great border policies, tough on crime policies. A strong national identity. A missile defense system that I would love to have in this country. That's what friends do: they make each other strong. They learn from each other that's what our friendship with Israel is going to look like. I'm going to have a good relationship with Bibi. I'll invite him to the White House in a way that Biden didn't have the courage to do.
This is what it means to be a true friend and no, I don't talk in the way that a standard establishment GOP politician does, reading from a Super PAC provided binder. That's not how I roll. I speak authentically. But that's actually going to make for stronger friendships with our allies on the international stage. And more importantly of all, actually make us stronger as a country here at home. In case people forgot, that's actually the job of the U.S President. So keep them coming. I know the knives are going to bring out some more attacks. And it's all right. We'll keep addressing them. Having fun with it. Talk to you. [END TRANSCRIPT]
Something needs to be pointed out, first recognized by Yale’s Professor Sonnenfeld: Ramaswamy enjoys getting himself into pickles, then battling his way out. This is a manifestation of his pathological narcissism. This clearly emerges in the video above, both in the phraseology and facial expressions. This is someone who has known only success and is supremely self-confident in his ability to BS wiggle his way out of any difficulty. We saw a similar example with Bill Clinton, only milder. Ramaswamy exhibits narcissistic grandiosity.
Narcissistic grandiosity is a personality trait characterized by an inflated sense of self-importance and a belief in one's own superiority. People with narcissistic grandiosity may have exaggerated feelings of superiority, entitlement, and self-importance. They may also have an obsessive need for admiration and a lack of empathy toward others.
People with narcissistic grandiosity may also have these characteristics:
Aggressive and dominant
Very self-confident and not sensitive
Willing to take advantage of others to get what they want
Boastful, vain, and arrogant
What happened to our protaganist’s Axovant stock price in the wake of its spectacular clinical failure? Billions of shareholder value went poof, before the company finally called it quits in early 2023, almost 8 years after this journey beganf.
To be continued . . .
LEARN MORE:
Will the Real Vivek Please Stand Up — Part 1: Red flags
Will the Real Vivek Please Stand Up — Part 2: Have you ever wanted to be a billionaire? 11 easy steps to immense wealth.
Will the Real Vivek Please Stand Up — Part 2.1: Vivek responds to Kevin's allegations.
Will the Real Vivek Please Stand Up — Part 2.2: 2015 Happy Talk vs. 2023 Sad Talk
Will the Real Vivek Please Stand Up — Part 3: Levin & Hannity August interviews
Will the Real Vivek Please Stand Up — Part 4: Vivek vs. Irwin; Respecting the least among us. A classy guy.
Will the Real Vivek Please Stand Up — Part 5: The Murdoch connection; friends in high places
Will the Real Vivek Please Stand Up — Part 6: Numbers which don't add up
Ramaswamyisms — Impressing with empty rhetoric