Pharmaceuticals

Teva’s new boss has bitter medicine to administer

7 Feb 2017

The Israeli pharmaceuticals company has lost its second chief executive in four years. Its next CEO faces tough times in America, where drugmakers’ pricing is under attack. Homegrown problems include bad acquisitions, tricky governance and an over-reliance on one drug.

Outsiders get a way to sample China’s biotech boom

7 Feb 2017

WuXi Biologics is preparing for a Hong Kong flotation. Innovation friendly policies have boosted the mainland drug market. But foreign investors lack ways to bet on this big part of China's new economy. They should be keen to inject money into WuXi.

AstraZeneca can now focus on problems, not pay

2 Feb 2017

Pascal Soriot's incentive scheme hinges on earnings hitting $4.20 a share in 2017. The UK pharma now thinks it won't. The hope is investors now focus on Astra's need for its cancer drug to work - rather than the risk of big EPS-boosting M&A to meet a spurious pay target.

Revised Walgreens deal full of quiet desperation

30 Jan 2017

To salvage its trustbuster-challenged acquisition of Rite Aid, the two drugstore chains agreed to sell more shops and cut the price by some $2 bln. They're settling for much less, but may have good reason more than a year on. That's if competition problems can even be solved.

Even a pariah can poke holes in drug-lobby spin

24 Jan 2017

The industry wants the public to focus on good deeds rather than price hikes. "Less hoodie, more lab coats," it says. Discredited hoodie-wearing ex-CEO Martin Shkreli quickly noted publicly that most drugmakers bear a stain or two. He's right: Big Pharma hasn't helped itself.

Cox: Quest begins for immaculate M&A conception

17 Jan 2017

Dealmakers, many of them gathering in Davos this week, will be on the hunt for mergers that can keep the boom rolling while satisfying President-elect Donald Trump's obsession with jobs. That means synergies are out and "transformation" is in. Shareholders may pay the price.

Pharma pays for getting too comfy with Trump

11 Jan 2017

The president-elect accused the industry of "getting away with murder" on drug prices. Investors had dismissed his earlier pledge to renegotiate costs as campaign rhetoric easily outweighed by tax cuts. The stock drops caused by his latest stance should force a broader rethink.

Valeant’s failed idea had a grain of truth

10 Jan 2017

Drugmakers spend $50 bln a year on R&D, but the payoff keeps declining. The projected return for the dozen biggest-spending companies is now less than 4 pct, according to Deloitte. Valeant tried to slash outlays and jack up prices. But it went too far and made things worse.

Takeda exemplifies Japan’s expertise at overpaying

9 Jan 2017

The $34 bln drug maker is the latest to pay over the odds. It's shelling out a 75 pct premium for Ariad, a biotech with a middling cancer drug. Takeda needs to refill its pipeline as patents on existing treatments expire, but the $5.2 bln purchase price looks too generous.

Gene therapy is ready to become hereditary

3 Jan 2017

The prospect of treating diseases like hemophilia and cancer by tinkering with DNA has a long history of both promise and frustration. Steady progress means 2017 should be the year the technology finally hits the U.S. market. The problem may be figuring out how to pay for cures.

Pharma’s middlemen will feel the squeeze in 2017

30 Dec 2016

The U.S. healthcare system's opacity and complexity have stoked drug prices, fueling the flow of dollars to insurers, wholesalers and pharmacy benefit managers. The growth of high-deductible insurance will bring much-needed transparency - and unaccustomed pressure on these firms.

Psychedelic drugs enlighten $2.5 trillion problem

29 Dec 2016

That was the cost of mental illness in 2010, an expense set to double by 2030, says the World Economic Forum. Psilocybin, magic mushrooms' active ingredient, has alleviated suffering in clinical trials. Illicit stigma aside, high returns on investment could make it worth a trip.

Deals from latest M&A boom will disappoint in 2017

21 Dec 2016

With corporate matchmaking proceeding apace, but slowing from its recent peak, investors are starting to calculate whether one plus one actually made three. More than half of mergers don't live up to promises. Three from the 2014 crop offer a guide to the letdowns of the future.

Mega-merger market set for last gasp

20 Dec 2016

Cheap debt and falling hurdle rates will keep bosses on the hunt. Border-spanning acquisitions are harder to square with trustbusters, however, and big targets less affordable as an M&A cycle ends. That makes space for smaller deals, which in any case tend to create more value.

KKR gets shot in arm from bumper Capsugel exit

15 Dec 2016

Selling the drug capsule group for $5.5 bln means the U.S. buyout group has tripled its money since buying from Pfizer in 2011. It has also done so without savaging Capsugel’s R&D budget. Acquirer Lonza gets vertical integration but will struggle to get the same kind of return.

Actelion looks like a lose-lose for Sanofi

14 Dec 2016

The French firm is mooted as a buyer for the Swiss biotech group after J&J walked away. The financial logic looks equally strained, and overpaying would smack of desperation about Sanofi's own business. With drug prices under pressure, pharma M&A will not get any more rational.

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.

Actelion could give J&J hypertension

25 Nov 2016

The U.S. baby lotion-maker is reportedly eyeing the $17 bln Swiss group Actelion, a specialist in blood pressure drugs. Given the latter's high price, J&J would need big cost cuts to make the deal work. Moreover, Actelion is fiercely independent, and faces mounting competition.

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.

U.S. Election Day is the new Friday-night dump

2 Nov 2016

Controversial companies such as Valeant, Viacom, SeaWorld and Mylan are releasing earnings on Nov. 8 - the day of the presidential poll - or Nov. 9. Good or bad news may sink with minimal media or investor attention as American eyes focus on the next occupant of the White House.