Healthcare

Aetna savings undercut wider synergy credibility

13 Dec 2016

The U.S. medical insurer's CEO now says cost cuts following its Humana acquisition are forecast at $3 bln a year, not the original $1.25 bln. Extra efficiencies conveniently help Aetna with its antitrust defense. The big revision should feed skepticism about all such estimates.

Biotech double defenestrates independence hopes

12 Dec 2016

The CEO and CFO of $30 bln Alexion have both left immediately. That's bad enough by itself. But the departures come in the midst of an investigation into sales improprieties. That, and a lack of transparency from the company, leaves Alexion open to a takeover.

Deal remorse puts investors in sorry state

7 Dec 2016

Abbott cited "material adverse events" in a legal bid to end its $5.8 bln takeover of rival Alere. Similar tensions have arisen lately in mergers involving Yahoo, Williams and Cigna. All caused share prices to swing. As M&A deals get stretched, skepticism can help avoid regrets.

Eli Lilly’s $10 bln fail detects what ails market

23 Nov 2016

Given that nearly every Alzheimer's drug falters in clinical trials, it should be little surprise the latest one did, too. Though Lilly's stock got punished, humanitarian and financial reasons justify such R&D efforts. The investor overenthusiasm disease should be easier to cure.

KKR burnishes establishment credentials in Japan

21 Nov 2016

Buyouts are nearly taboo in Japan and blue chips hate selling non-core businesses. So KKR's 2013 purchase of Panasonic Healthcare broke new ground. Now Mitsui, a pillar of Japan Inc, has sunk $500 mln into the healthcare firm. That further validates KKR's collaborative approach.

Pfizer would play to strength by focused selling

10 Nov 2016

The $217 bln drug company has decided not to split, but is mulling selling or hiving off its consumer health division. There's no obvious logic for a pharma firm to hawk Advil and ChapStick. Pfizer history suggests it's a better seller than buyer, and the timing is also right.

Siemens gives itself chance to prove it can do M&A

10 Nov 2016

The engineer will spin off its healthcare unit, and probably retain a majority stake. The margin-rich business could be worth $40 bln, fetching a 38 pct premium. The increased M&A firepower will give Siemens a chance to correct a record on deals which is rather less impressive.

Obamacare could be closest analog to U.S. Brexit

9 Nov 2016

The Republican Party and president-elect vow to rip up the Affordable Care Act. Like Britain's withdrawal from the EU, there's no plan for what comes next. Some 20 mln people and a fifth of the economy will be affected. Trump gets to invent and take responsibility for Trumpcare.

Valeant heralds second act of pricing pushback

8 Nov 2016

The embattled drugmaker slashed its profit forecast to below the lower end of a previous range. Some problems are specific to Valeant. The whole industry, however, faces mounting pressure from aggressive politicians and insurers, upending the business model of charging more.

Merger medicine fails to cure CVS Health

8 Nov 2016

The $80 bln drugstore chain warned that profit growth would slow down. Fewer customers and the loss of a couple big contracts were factors. Industry-wide pricing pressure adds to the challenge. Two big deals last year worth a combined $14 bln may be causing bad side effects.

California voters guinea pigs in drug-price trial

3 Nov 2016

The electorate decides next week whether to cap the cost of prescription medicine. If approved, Proposition 61 may initially be hard to implement. But as with reducing car emissions and legalizing marijuana, a yes vote from the Golden State could prompt a nationwide debate.

Viewsroom: What to watch for beyond Clinton-Trump

3 Nov 2016

Americans aren't just voting for the 45^th president. House and Senate elections affect everything from Wall Street to the Supreme Court. And marijuana and healthcare figure prominently in state ballots. Meanwhile, there's more brouhaha around Brexit. And GE is shaking itself up.

Obamacare could use a transplant, not euthanasia

1 Nov 2016

Donald Trump and fellow Republicans are using rising premiums and departing insurers to renew calls to bury the U.S. president's signature healthcare program. But they lack a viable alternative, meaning millions would lose coverage. Bipartisan surgery is a smarter option.

Blackstone sews up $6.1 bln M&A crash victim

31 Oct 2016

The private-equity firm is rescuing TeamHealth after the hospital-staffing company came a cropper by choosing to buy at the top rather than sell at a hefty premium. Blackstone, which owned TeamHealth before, can patch it up and sell it again, benefiting from the hubris M&A brings.

Philips nears discharge after open-heart surgery

24 Oct 2016

The $27-billion Dutch healthcare technology company grew core sales 5 percent in the third quarter. Reductions in costly long-term debt will help earnings, but a full recovery hinges on Philips selling more of its weaker lighting business and a rise in European medical spending.

Unilever scrubs up venture capitalist credentials

20 Sep 2016

The $136 bln Dove soap maker is buying green products firm Seventh Generation, talking with Jessica Alba's company and acquired Dollar Shave. Assimilating fast-growing niche brands with entrepreneurial cultures isn't easy. Unilever's Ben & Jerry's experience gives it a leg up.

Abbott eases its M&A risk with $4.3 bln asset sale

19 Sep 2016

With two acquisitions worth over $30 bln pending – and the purchase of Alere, in particular, not going smoothly – the $62 bln health firm is vulnerable. Selling its eye-surgery unit to J&J gives Abbott needed financial breathing room and perhaps extra leverage with Alere.

Perrigo shows danger of overplaying M&A defense

12 Sep 2016

The $13 bln drug company fought off Mylan's hostile takeover bid last year. Now it's missing the targets it set to persuade investors to reject the deal. It's a common infraction that in Perrigo's case has prompted activist Starboard to dive in. Overpromising is a fool's errand.

Zika fear effect can create Asian contagion

12 Sep 2016

The virus is taking hold in Singapore and countries around the finance hub. The SARS crisis showed how changes in human behaviour can hurt growth more than an epidemic. Zika's grim effect on babies also adds a fear factor. Asia can ill-afford to see visitors stay away.

Danaher returns to dealmaking with $4 bln dud

6 Sep 2016

Fresh from splitting off its industrial arm, the healthcare giant is buying molecular tester Cepheid. Cost cuts cover barely half the 54 pct premium and investors aren't buying promises of extra revenue. CEO Tom Joyce's claims of greater efficiency and growth are falling flat.