Pharmaceuticals

West is sleepwalking off healthcare cliff

17 Jul 2023

Europe is scrambling to end its reliance on Chinese raw materials for green energy and chips. But policymakers forget the region sources 80% of ingredients for top medicines in the East. Producing them at home may prevent a crisis but it risks exacerbating public debt piles.

Moderna finally gains tenuous toehold in China

6 Jul 2023

The $47 bln US biotech company will develop and sell mRNA treatments in the People's Republic. It’s a bet that the country’s ageing population will spur growth and comes after years of trying. But geopolitics and rising local competition loom over its expansion plans.

Why backing prevention can yield better health

27 Jun 2023

Treating illnesses like cancer consumes 11% of global GDP, according to the World Health Organization. In this Exchange podcast, Dr. Katie Tryon, director of healthcare strategy at Vitality, explains that overburdened care systems need to spend their way back into shape.

To relinquish Grail, Illumina should fight for it

12 Jun 2023

A departing CEO and an ousted chairman signal an end to the gene-sequencing company’s effort to retain the $7 bln cancer detection business it bought without regulatory approval. The best way to secure a good price may be to keep battling US and EU trustbusters in court.

Pampered pets unleash booming market

6 Jun 2023

The pet craze brought on by the pandemic has become a boon for companies that sell products to dog-loving owners. FidoCure founder Christina Lopes explains to The Exchange podcast how this might be able to help humans, too.

Capital Calls: Turkey, Indivior

5 Jun 2023

Concise views on global finance: President Tayyip Erdogan’s new treasury minister will struggle to steer the $900 bln economy towards orthodox monetary policies; shares in the London-listed drugmaker jumped after it settled a lawsuit, making it more appealing to potential buyers.

Capital Calls: $6 bln pet buyout

2 Jun 2023

Concise views on global finance: Shares in UK veterinary pharmaceuticals group Dechra are trading 6% below private equity firm EQT’s new, lower bid. That looks too pessimistic given the chunky valuation on offer.

Illumina shareholders vote for lose-lose outcome

25 May 2023

Carl Icahn scored a seat on the $30 bln biotech’s board, but fell short of the three he sought. Boss Francis deSouza won re-election but must now deal with the activist’s lieutenant. And newer investors hoping Illumina was in for a big shake-up will be disappointed. No one wins.

Drug M&A comes down with case of antitrust fever

17 May 2023

Amgen’s $28 bln purchase of rival Horizon could unfairly boost the target’s treatments, the merger watchdog says. The FTC’s focus on so-called bundling could be troublesome for the pharma industry, but is also hard to prove. Investors may be too pessimistic about the deal.

Pharma’s obesity gold rush will have limits

11 May 2023

Drugmakers Novo Nordisk and Eli Lilly are vying for a large slab of the weight loss medications market, which analysts reckon could be worth $100 bln by 2031. In this Viewsroom podcast, Breakingviews columnists discuss how investor optimism in a booming market is unwarranted.

Capital Calls: Walt Disney

10 May 2023

Concise views on global finance: Bob Iger’s first full quarter since returning as CEO opened a window onto multiplying challenges across the Magic Kingdom.

Novo Nordisk’s chunky valuation risks crash diet

4 May 2023

The $274 bln pharma group trades at a big premium to peers. Investors are buoyed by hopes Novo can take a large share of an obesity market that could be worth $100 bln by 2031. But competition and questions about its drug’s effectiveness could slim down its valuation.

Eli Lilly’s golden ticket is a regrettable winner

3 May 2023

A voucher system to encourage drug development for neglected diseases has mostly been a limp carrot. For some, though, fast lanes to U.S. FDA approval are worth a fortune, perhaps $30 bln for a new weight-loss treatment. But the pandemic showcased better ways to spur investment.

Capital Calls: BP, Japanese M&A

2 May 2023

Concise views on global finance: The oil giant will buy back $1.8 bln of shares over the next three months, which is less than investors hoped for; Astellas Pharma is making the most of cheap debt for its $5.9 bln pounce on U.S. eye-treatment specialist Iveric Bio.

Capital Calls: Exxon, US regional banks

28 Apr 2023

Concise views on global finance: Exxon’s two golden eggs are the Permian and Guyana; market composure gives time for a First Republic fix.

Capital Calls: US GDP, Eli Lilly, EU budget

27 Apr 2023

Concise views on global finance: Consumer spending provided fragile support for the US economy in the first quarter. Meanwhile pharma group Eli Lilly is racing against rising obesity expectations, and the European Commission faces German hurdles to replacing its budget rules.

J&J carves itself up at a discount

24 Apr 2023

The healthcare giant is floating part of its Listerine-to-Tylenol business with a mooted price of $40 bln, a 20% discount to rival Haleon. Litigation risk and an inhospitable market may leave J&J with a valuation wound in need of a Band-Aid. For investors, it’s worth the risk.

Icahn may fall short in quest of the holy Grail

21 Apr 2023

New rules in proxy contests haven’t helped activists in Disney or Salesforce. But with a concentrated shareholder base, they may embolden Carl Icahn as he agitates at Illumina, in the process of buying cancer detector Grail. The trouble is Icahn is pushing beyond the attainable.

Big Pharma risks overdosing on M&A

19 Apr 2023

Drugmakers including Pfizer and Sanofi have started 2023 with $65 bln of U.S. deals, a 50% jump from the decade average. A big reason is that heavyweight payer Medicare can negotiate price cuts from 2026. The rush to plug revenue gaps will lead to much misallocated capital.

J&J’s sweetened talc settlement still unsettling

4 Apr 2023

The healthcare giant’s attempt to limit legal claims to a unit that declared bankruptcy was shot down by courts. It’s trying again with a $7 bln bigger pot and more plaintiffs on board. That may appease the aggrieved. But bypassing jurors sets a bad precedent.