I increased our Grail position to 5% of our portfolio. Grail was spun off from Illumina last year, and as part of that spinoff we received fractional shares. I held onto those shares because I wanted to see the data release and evaluate the company’s progress in blood-based cancer detection tests. During this quarter we learned that the test results were positive and could potentially lead to FDA approval. As a result, I increased our position and look forward to watching this company grow in the coming years.

We sold enough of Grail in the low $50’s to reduce our cost basis to zero. For a well that seemed clever but the remainder we have is soaring up 148%. You never go broke taking a profit but the big money is always made in the holding.

Grail Inc (GRAL) is positioned for significant growth with its Galleri test, which screens for over 50 cancer types, many of which lack established screening protocols. The recent positive results from the PATHFINDER 2 study indicate substantially higher cancer detection rates, enhancing the test's value proposition. As awareness of this innovative cancer detection method grows, and with the potential for FDA approval and adoption by the NHS, Grail is set to generate billions in annual recurring revenue. The company's cash burn is expected to decrease as sunk costs are behind them, and management's incentives align with shareholder interests.

Grail's Galleri test, which utilizes methylation technology, is recommended for adults at elevated risk for cancer and screens for a shared signal present in over 50 cancer types. The test has shown to approximately double the number of cancers detected when added to existing single-cancer screenings. Grail sold more than 137,000 Galleri tests in 2024, achieving a 45% year-over-year revenue growth to $108.6 million. With a moderated cash burn and a strong cash position of $767 million, Grail is on track for continued commercial growth in 2025, especially with potential FDA approval and NHS adoption, which could lead to multibillion recurring annual revenue.

Grail's Galleri test, which utilizes methylation technology, is recommended for adults at elevated risk for cancer, screening for a shared signal present in over 50 cancer types. The test has shown to approximately double the number of cancers detected when added to existing single-cancer screenings. Grail sold more than 137,000 Galleri tests in 2024, achieving a 45% year-over-year revenue growth to $108.6 million. With a moderated cash burn and a strong cash position of $767 million, Grail is on track for continued commercial growth in 2025, especially with potential FDA approval and NHS adoption, which could lead to multibillion recurring annual revenue.

We initiated a small position in Grail (GRAL), a recent spinoff. While macro headlines and policy developments can create short-term volatility across the sector, we believe these companies trade at substantial discounts to intrinsic value, offering significant upside with a significant margin of safety over the long term.

We initiated a small position in Grail (GRAL), a recent spinoff. While macro headlines and policy developments can create short-term volatility across the sector, we believe these companies trade at substantial discounts to intrinsic value, offering significant upside with a significant margin of safety over the long term.