Pharmaceuticals

Coronavirus vaccine hopes inflate bubble

21 Jul 2020

Multiple biotechs like Moderna are developing vaccines. The market capitalization of five of them is up over eightfold, adding more than $50 billion of value. That's excessive even if they capture the entire benefit – and there are over 150 competing efforts in all.

Corona Capital: Expense accounts, Zoom’s new box

15 Jul 2020

Concise views on the pandemic’s corporate and financial fallout: Goldman Sachs’ earnings give an insight into pandemic-era client schmoozing, and virtual meeting facilitator Zoom tiptoes into the high-priced hardware market.

Takeda feeling uncomfortable Shire side effects

13 Jul 2020

The Japanese drugmaker is near a deal that would get it to a $10 bln divestiture target 18 months after buying its Irish rival for $62 bln. Promised cost savings are materialising and debt slowly shrinking. Weak stock performance under boss Christophe Weber suggests he overpaid.

Corona Capital: Quarantines, UK bailout, Drugs

3 Jul 2020

Concise views on the pandemic’s corporate and financial fallout: Britain relaxes its “bonkers” quarantine rules; a small UK bailout sets a troubling transparency precedent; and India’s drugmakers click into dealmaking mode.

Carlyle hedges Indian link in pharma supply chain

30 Jun 2020

The buyout firm is taking a 20% stake in Ajay Piramal’s contract drugmaker at a healthy $2.8 bln valuation, ahead of a planned carve-out from its lending-focused parent. The division can benefit from a worldwide reshoring push. Short-term concerns explain the fiddly deal terms.

Gilead gives glimpse into feverish drug market

29 Jun 2020

Its Covid-19 treatment will set governments back about $2,300 per course – more than it costs to make but far less than U.S. patients would incur with longer hospital stays. There are many ways to decide the value of a drug. Gilead is, perhaps wisely, being relatively restrained.

Royalty Pharma merits private equity drug discount

16 Jun 2020

Pablo Legorreta’s company, which buys up revenue streams on potential blockbuster drugs, went public at a nearly $17 bln valuation. It has been a buyers’ market with limited competition. But rising political risk warrants a big discount to more diversified peers like Blackstone.

Gilead solidifies pharma pandemic insurance premia

9 Jun 2020

The $100 bln company has an approved Covid-19 drug that the U.S. government is distributing. That helps replace maturing HIV and dwindling hep C meds, and made Gilead a takeover target. The ability to cure what ails the entire economy buffs the sector’s strong defensive nature.

AstraZeneca M&A puzzle sends shareholder warning

8 Jun 2020

The $140 bln drugmaker approached U.S. rival Gilead about a merger, Bloomberg reported. The combination lacks strategic logic and looks unlikely. CEO Pascal Soriot has done well for investors. The risk is AstraZeneca’s debt load, or his bigger ambitions, threaten that record.

U.S. testing firms aren’t having a great pandemic

4 Jun 2020

With no vaccine, finding Covid-19 cases is key. But it’s not lucrative. Extra revenue is being offset by falls in other tests for Quest and rival lab companies and in unrelated businesses for test makers like Abbott. There's little time to cash in and plenty of competition.

The Exchange: Vaccine optimist

26 May 2020

Lloyd Minor, the dean of Stanford’s school of medicine, tells Rob Cox that research into the coronavirus shows promising signs for the discovery of a vaccine. Just the same, the world needs to better prepare for pandemics, and medicine is at the cusp of extraordinary change.

Sanofi finds M&A cure to CEO foot-in-mouth disease

26 May 2020

The French drugmaker is selling a $13 bln stake in biotech Regeneron. CEO Paul Hudson, recently chastised for saying America would get first dibs on a Covid-19 vaccine, now has a pristine balance sheet to do deals and invest. It helps Sanofi’s growth problem, and public image.

J&J talc is a dry run for pandemic product risk

20 May 2020

The U.S. firm will stop selling talcum powder in the U.S. amid what it calls misinformation about its safety. That’s no big loss. But avoiding lawsuits can also deter companies from taking risks that aid the common good. Vaccines are an example, but the line isn’t always clear.

Moderna puts stock-sale opportunism to test

19 May 2020

The biotech pitching a Covid-19 vaccine joins a rapidly growing list of firms selling more shares to investors. It makes sense, given the market rebound, and some issuers’ need for cash. But the rush to sell by more speculative companies like Moderna should give buyers pause.

Corona Capital: Air travel, Starbucks

14 May 2020

Concise views on the pandemic’s corporate and financial fallout: Airlines’ experienced hands offer warning; Starbucks begins dance with landlords.

One odd U.S. healthcare habit to get a viral cure

13 May 2020

About half of Americans are insured through their employers. Many like it that way, which has hindered reform of an irrational system. With millions out of work, firms and workers will be more willing to consider alternatives. The window for improvement is about to crack open.

Corona Capital: Payments M&A brawl, Endeavor

7 May 2020

Concise views on the pandemic’s corporate and financial fallout: Payments firm Wex’s attempt to ditch a double deal for two UK rivals will face legal pushback and perhaps Elliott Management’s ire. Talent agency Endeavor’s 2018 Epic Games investment is starting to come in handy.

Corona Capital: Beyond Meat, Facebook, Natixis

6 May 2020

Concise views on the pandemic’s corporate and financial fallout: Beyond Meat’s stock burn, Facebook installs an oversight board, Natixis’s bad news-good news situation.

Biotech M&A deal looks too rich for its blood

5 May 2020

Alexion agreed to pay $1.4 bln for smaller rival Portola and its potentially promising drug to reverse anticoagulants. The target has been on a downward slide for years – but is still bagging a 132% premium. That’s baking in success, but it’s more likely Alexion is overpaying.

Corona Capital: U.S. GDP, Gilead’s drug, Spotify

29 Apr 2020

Concise views on the pandemic’s corporate and financial fallout: the U.S. economy takes a dive; Gilead’s antiviral drug may help a bit; and Spotify sings an upbeat tune.