Pharmaceuticals

Corporate boards have lost the war on drugs

8 Jan 2024

Some directors at the six companies run by Tesla boss Elon Musk worry his drug use will hinder business. Dabbling in narcotics is rising while testing is falling, and legalization has normalized dope use. For corporate chieftains, though, even a little may be too much.

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.

Swiss pharma mega-deal has healthy prognosis

19 Dec 2023

In 2001 Novartis took a stake in Roche, yet a deal never happened. Over two decades later, the mooted acquirer is stronger and could gain from vast synergies and more heft in oncology. Making the $440 bln union a reality means overcoming family pride, and antitrust issues.

Ozempic overshoot will plump up bargain-hunters

18 Dec 2023

New weight-loss drugs are highly effective, but investors risk overestimating how fast change will occur and how many people will take the therapies indefinitely. Some companies regarded as victims, such as Zimmer Biomet, may even benefit. Contrarian investors may profit in 2024.

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.

Drugstore $6 bln deal has sickly governance

12 Dec 2023

Australian discount chain Chemist Warehouse is going public via a reverse takeover by struggling rival Sigma. It’s a good move for both companies. But insiders will rule the board, and three of them will own half the new firm. Over time, such private company trappings need to go.

How a bold $60 bln deal went right yet so wrong

6 Dec 2023

Japan’s Takeda has cause to celebrate the fifth anniversary of its landmark acquisition of Irish peer Shire. Boss Christophe Weber achieved many aims, including broader reach and hefty cost savings. As with myriad mega-mergers, however, there’s little for shareholders to cheer.

Purdue mess pits drug victims against due process

5 Dec 2023

The $10 bln settlement ending opioid lawsuits is done and dusted, except for a case being reviewed by the Supreme Court. Justices’ discomfort over bankruptcy protection for the Sackler family has merit. But throwing out a deal means aggrieved parties just have to wait longer.

Capital Calls: Roche, Brookfield/Origin

4 Dec 2023

Concise views on global finance: The $224 bln Swiss drugmaker is splurging $2.7 bln on obesity drug developer Carmot; the Canadian investment firm’s joint $13 bln bid for Origin Energy has failed. The trick now is to show what lessons it’s learned from its 16-month-plus campaign.

Competition will make obesity drugs successful

1 Dec 2023

Medicines like Novo Nordisk’s Wegovy decrease weight and mortality. CEO Jørgensen has suggested a tiered pricing scheme that addresses the long arch of benefits. It makes sense, but competition, rather than innovative pricing schemes, may be faster.

AbbVie clinches the drug patent-cliff dismount

30 Nov 2023

A $10 bln purchase of ImmunoGen is the pharma giant’s latest bid to replace sales from maturing mega-drug Humira. While sometimes the fear of losing patent protection on a star product is justified, AbbVie shows it’s possible to go over the cliff and live to tell the tale.

Insurer mega-deal faces doubly poor prognosis

29 Nov 2023

Cigna and Humana are in talks to create a $135 bln giant. Overcoming near-certain trustbuster opposition likely means hiving off overlaps that would benefit either and enduring a year-plus wait. Judging by investors’ early response, that might cause them to nix the idea first.

Eli Lilly’s M&A trial prints lose-lose outcome

21 Nov 2023

The pharma giant has offered $1.4 bln for Point Biopharma, but if the target’s latest drug comes good it could be worth much more. No wonder Point investors are sitting on their hands. Had Lilly offered them a share of future profit, it could have saved itself the embarrassment.

Bayer drug fail is symptom of growing breakup pain

20 Nov 2023

Shares in the 33 bln euro group fell 20% after it aborted a late-stage trial. Given drugs regularly fail, that’s excessive. Instead, investors’ main concern could be that a grim pharma outlook and litigation risk in Bayer's seeds unit mean a planned split may release less value.

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.

Drug shortages demand quick and costly action

7 Nov 2023

Chemotherapy and penicillin ran short over the past year amid supply-chain disruptions and regulatory pressure. In this Exchange podcast, Dr. Steffen Denzinger, president of the European Fine Chemicals Group, argues that safeguarding medicines may require patients to pay more.

Sanofi sickness calls for activist tonic

2 Nov 2023

The pharma group lost nearly $27 bln of market value as it announced more investment in drugs. To keep investors happy, CEO Paul Hudson can sell its consumer business, step up dealmaking and buy back shares. Its long-suffering shareholder L’Oréal has reason to back bold action.

Tough dealmaking conditions dull Waystar’s shine

31 Oct 2023

The healthcare technology firm is angling for a stock-market listing on the back of rapid, acquisition-fueled growth. With a sale looking difficult and heavy debt bearing down, an IPO may be its private equity backers’ best option, but a mooted $8 bln valuation looks steep.

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.