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I Smell A Rat, er, A Blog

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AP

I’ve said it before, and I know it’s a bad cliché (is there such a thing as a good cliché?), but I learn something new almost every day.

Today, my lesson came in the form of an eye-catching research note out of Leerink Swann, which specializes in covering healthcare-related companies and stocks.

The report is on a company that I really don’t follow all that much: Sangamo Biosciences . But it’s the title that grabbed me. “Knockout Rats Using ZFN Technology Could Become Transgenic Animal Standard.”

I always thought rats are pretty ugly, disgusting, uh, dirty. I’ve never seen a rat I’d describe as a knockout. But, okay, if you say so. Alright, I’m not that dumb. With an assist from my producer, Ruth, (I was too busy on the Nasdaq hamster wheel) I learned that knockout refers to the research practice of knocking out an existing gene in a lab rodent and replacing it. But what in the heck is ZFN? Well, according to Leerink Swann’s report it stands for “Zinc Finger Nuclease.” I think I’m gonna save that lesson for another day.

So, back to those knockout rats. LS analyst Joseph Schwartz is telling clients, “We believe the market is underappreciating SGMO’s 10.5 percent royalty on all knockout (KO) rats soon to be sold by Sigma-Aldrich. KO rats could represent near-term revenues since FDA approval is not required and SIAL plans to begin selling them this month….” LS makes a market in SGMO and SIAL.

I hope I’m not inviting a flurry of nasty emails from animal rights folks, but this is big business. Schwartz says, “The transgenic animal market is estimated at $700 million-$1 billion.”

That knocks me out.

Questions? Comments? Pharma@cnbc.com and follow me on Twitter at mhuckman