Healthcare

Bayer investors get unwelcome antitrust present

10 Apr 2018

The German company has struck a deal with U.S. regulators to clear its $60 billion acquisition of seed group Monsanto, the Wall Street Journal reported. After EU approval in March, a two-year saga is almost over. Bayer’s sagging stock price means shareholders can hold the cheers.

Novartis $8.7 bln splurge balances risk and growth

9 Apr 2018

The Swiss drugmaker paid a near 90 pct premium for AveXis, which is developing a treatment for spinal muscular atrophy, weeks after selling its consumer drugs joint venture. Experimental drugs offer faster growth than painkillers but more risk. It’s a pricey way to boost revenue.

Smith & Nephew’s new boss has two rehab options

4 Apr 2018

CEO Namal Nawana has to revive mediocre top-line growth and slash costs at the artificial-knee maker. A flair for turnarounds should keep activist Elliott at bay for now. And the sale of the last company he headed shows an appetite for more drastic prescriptions when necessary.

Siemens’ slimming strategy is half-hearted

3 Apr 2018

A part-sale of medical unit Healthineers has failed to shrink the German company’s conglomerate discount. After all, the 84 bln euro group still spans trains, energy and factories. Siemens’ exit from the lighting and mobile businesses offers CEO Joe Kaeser a useful template.

Walmart may have hit on healthy kind of disruption

30 Mar 2018

Merging with insurer Humana could put clinics in the U.S. retailer’s stores, keeping patients out of hospitals and insurance costs down. Walmart isn’t given to big acquisitions and $37 bln Humana wouldn’t come cheap. But a broader partnership could bring many of the benefits.

Drug companies take the anti-Amazon pill

27 Mar 2018

Novartis is selling its consumer health assets to GSK for $13 bln. It makes sense for the former to focus on traditional drugs given the threat from e-commerce. For the latter, the purchase is less risky than a Pfizer deal and may still allow investment in its core business.

Market jitters accentuate M&A regulatory risk

26 Mar 2018

Dealmaking sprees are prone to extinction events. Market panics erode the value of buyers’ stock, make bankers reluctant to lend, and change the outlook violently. Recent tumult doesn’t yet qualify, but it makes it harder to overlook deals that push the regulatory limits.

Self-driving cars may find legal lesson in pharma

22 Mar 2018

Autonomous vehicles should make road deaths like the one involving an Uber prototype a rarity. Paradoxically, as drugmakers found with vaccines, mishaps may raise legal costs and drive companies out of the market. Limits on suits and a compensation fund balanced risk and reward.

SEC gives wrong Theranos lesson to Silicon Valley

14 Mar 2018

Elizabeth Holmes’ company raised $700 mln in a “massive” fraud that put patient lives at risk. Yet regulators are letting her escape with a slap on the wrist, and not admit guilt. The SEC says this is an important lesson for startups, but it shows how toothless the agency is.

Profit is only part of U.S. healthcare sickness

12 Mar 2018

America spends about 18 pct of GDP on healthcare – almost twice as much as most developed countries. Pricing to reward investors accounts for perhaps a fifth of this gap. High pay, fights over the spoils and the fetishization of costly high-tech medicine are other factors.

Cigna pays over the odds for uncertain benefit

8 Mar 2018

The insurer is paying $54 bln for pharmacy middleman Express Scripts in the latest healthcare consolidation move. Express’s business has stalled and the FDA’s campaign for drug-price transparency threatens its model. Cigna’s $13 bln premium is not a sure prescription for growth.

Akorn deal could crack M&A MAC nut

6 Mar 2018

Merger escape clauses are notoriously hard to trigger. Even performance woes at drugmaker Akorn aren’t enough for Fresenius to demand a discount on an agreed $4.3 bln tie-up. If the German healthcare group can prove Akorn misled regulators, though, it is a different story.

Hadas: Billy Graham’s great missed economic chance

26 Feb 2018

The evangelist, who died last week, lived through a global debate over the Christian responsibility to help society. He put preaching before activism. If he had spoken out – as many European Catholics did – America might have a stronger welfare system now, and less populism.

Siemens’ $50 bln IPO may be first step to breakup

19 Feb 2018

The German industrial giant’s shares could be worth 25 pct more if a sale of its healthcare unit lifts a conglomerate discount. But investors may still balk at owning a company with listed stakes in disparate sectors like wind and rail. In that case, calls for a breakup may grow.

Walgreens Boots mulls $20 bln back-to-future deal

13 Feb 2018

Stefano Pessina’s dealmaking turned a small Italian drug distributor into a $68 bln drugstore chain. Buying out wholesaler AmerisourceBergen would take the business full circle, tighten the firm’s U.S. supply chain, and set up future deals to fend off the new threat: Amazon.

Bill Gates and buyout baron create negative impact

5 Feb 2018

The billionaire’s Gates Foundation is at odds with Abraaj, a buyout group, over a $1 bln fund to provide healthcare in emerging markets. The dispute underscores the tension in combining charitable and financial goals. The fallout will only fuel skepticism of impact investing.

U.S. healthcare bloat faces new triple threat

30 Jan 2018

Amazon, Berkshire Hathaway and JPMorgan are getting together to cut medical costs. Details are few and obstacles many, but they bring relevant skills and a lot of employees to the mix. A multibillion-dollar hit to health-sector stocks shows the shakiness of the status quo.

U.S. flu-shot savings are nothing to sneeze at

25 Jan 2018

A harsh influenza strain is knocking more Americans flat this winter. The tab for medical care should exceed $10 bln, while lost work days will take an even larger toll on companies. Offering free shots for all would be a cost-effective way for society to reduce the burden.

Weed giants share a deserved peace pipe

24 Jan 2018

Canada’s Aurora and rival CanniMed have agreed a friendly merger after months of acrimony. CanniMed’s shareholders only get a small stake in the $6.2 bln combination, but a big uplift in value. The world’s biggest listed weedmaker is now well positioned for regulatory changes.

Ping An’s Big Health plan risks excess success

23 Jan 2018

A $9 bln unit of the Chinese insurer that analyses patient data has lured backers like SoftBank, Reuters reports. The digital upgrade of China’s clunky medical system is a lucrative opportunity for private firms. Data security is a risk; getting too big, too quickly may be worse.