Medical devices

European pharma’s growth prescription: pivot to US

28 Nov 2024

Novartis, Novo Nordisk and regional rivals lost $86 bln in value over concerns about tariffs and other possible measures by President-elect Donald Trump. Stateside M&A and manufacturing moves could ease the pain and boost revenue. But hopping across the pond will mean paying up.

Philips’ China misery renews case for bold surgery

28 Oct 2024

The $25 bln Dutch medical group’s shares fell up to 17% after it said it would barely grow this year. Weak demand in its key Chinese market means any recovery is far off. The weak outlook makes it harder to justify keeping its sprawling consumer and healthcare divisions together.

Philips’ share-price revival is only half finished

29 Jul 2024

The Dutch medical group’s orders are finally growing again, boosting the stock by 10%. Yet Philips is still well below its 2021 peak, before a faulty sleep-aid crisis. Keeping margins high and sales rising may help, but selling the consumer unit may complete the rejuvenation.

The Agnellis’ risky Philips bet starts to pay off

29 Apr 2024

The Dutch group settled its US faulty sleeping aid claims for a manageable $1.1 bln, lifting its stock 35%. The relatively quick fix vindicates Exor CEO John Elkann’s $3 bln punt on Philips when legal worries kept investors away. It may also shift the thinking on big litigations.

Capital Calls: Wegovy gets a booster

22 Mar 2024

Concise views on global finance: The US government’s decision to pay for weight-loss drugs for some older patients is a big step for makers Eli Lilly and Novo Nordisk. Not because it will boost their share prices, but because it makes current valuations less far-fetched.

Philips sees dim light at end of tortuous tunnel

29 Jan 2024

The $19 bln Dutch medical-kit maker faces a lengthy ban on selling ventilators in the US. Despite the hit, CEO Roy Jakobs is confident he can meet his business goals. Yet a possible fine, as well as litigation arising from faulty machines, will keep weighing on investors’ minds.

Bristol Myers new CEO grabs M&A by the horns

22 Dec 2023

Buying rival drugmaker Karuna for $14 bln is a big risk for just-installed Chris Boerner. Karuna’s schizophrenia therapy could see giant sales, but with much uncertainty and suboptimal patent protection. Pharma has shone in a dismal year for mergers. Even so, it’s a daring deal.

Price of Illumina’s Grail fail extends to board

19 Dec 2023

The gene-sequencing company finally conceded to selling the cancer-testing business it bought without regulatory approval for $7.1 bln. Its bravado will be costly, as Grail’s value has plummeted. Boss Francis deSouza already paid with his job; directors deserve to, as well.

Oprah’s Weight Watchers is Ozempic-as-a-platform

15 Dec 2023

Obesity-fighting drugs should curb demand for hawkers of weight-loss regimens. But WW bought a telehealth firm that can push prescriptions, like those used by its celebrity backer, to customers. As insurers fund habit-forming programs, companies will find ways to take a cut.

Amazon’s health push is a too-costly prescription

8 Nov 2023

The tech giant is slashing membership prices at its US doctors’ practice, One Medical, to $99 for Prime members. Primary care burns cash, and unlike digital efforts a chase for scale seems unlikely to help. It’s a pricey strategic drift to secure some extra subscriber loyalty.

Capital Calls: Pfizer pessimism

31 Oct 2023

Concise views on global finance: A glut of vaccines has gutted Pfizer’s valuation, leaving it lower than it was before the pandemic. That’s an over-reaction, even if its Covid-19 therapies prove worthless.

Stolen genetic data points to mutating cyber risk

17 Oct 2023

Biotech firm 23andMe may have fallen victim to hackers, joining other sabotage targets Clorox and MGM. Companies can strengthen their systems, but human error plays a role too – with customers and employees as potential vulnerabilities. That adds a new front to an ongoing battle.

Covid-induced Nobel Prize is on brand

2 Oct 2023

Two scientists won the award in a relatively quick 18 years after publishing seminal work for vaccines that helped stop the pandemic. Global disasters often speed up scientific advances. The balance in pushing for rewards and possible consequences changes when more is at stake.

Covid tester buyout hands investors a bitter pill

29 Sep 2023

Cinven is buying back Synlab after floating it just two years ago. Acquiring the German group at a 44% discount to its IPO price is nice for the buyout shop, but hard for investors to swallow. Either way, it reflects ebbing demand for health checks as inflation soars.

Bausch pushes debt escape plans to extremes

19 Sep 2023

BHC’s CFO just quit as the drugmaker mulls a dicey plan to spin off its $5.5 bln Bausch + Lomb stake. Such engineering increasingly pits creditors against shareholders, in this case Carl Icahn and John Paulson. Stronger covenants would help, but CEOs keep getting more creative.

Alphabet moonshots are ready for launch

29 Aug 2023

Google’s parent lost $6 bln last year on experimental ventures, such as health-data cruncher Verily and self-driving outfit Waymo. As CFO and former tech banker Ruth Porat takes charge of the unit, it’s probably a good time to consider carving out some and refocusing on others.

Capital Calls: Pharma’s ills

28 Aug 2023

Concise views on global finance: The Biden Administration will announce 10 drugs that face Medicare price negotiations on Tuesday. The hits to individual firms will be manageable, but new announcements every year means over a $250 billion blow to the industry.

Opioids expose unhealthy bankruptcy addictions

11 Aug 2023

Mallinckrodt may file for Chapter 11 again, wiping out most of a $1.7 bln settlement over the painkillers. The insolvency also shielded executives from lawsuits, just as the Sacklers want to do. Such legal protections and undercapitalized restructurings discredit the process.

Obesity drugs take brakes off Big Pharma’s growth

8 Aug 2023

Eli Lilly’s diabetes treatment helped lift quarterly revenue 28%, while increased production will spur the $500 bln drugmaker’s top line. Evidence that rival Novo Nordisk’s weight loss drug reduces the risk of heart attacks will persuade insurers and governments to foot the bill.

Brain implant needed to justify a $5 bln Neuralink

5 Jun 2023

Elon Musk’s startup promises brain-computer interfaces that do everything from curing disease to storing memories. The $5 bln valuation presupposes $3 bln of revenue in 10 years. That’s an optimistic timetable, even assuming Musk’s technology is successful.