Walmart may have hit on healthy kind of disruption 30 Mar 2018 Merging with insurer Humana could put clinics in the U.S. retailer’s stores, keeping patients out of hospitals and insurance costs down. Walmart isn’t given to big acquisitions and $37 bln Humana wouldn’t come cheap. But a broader partnership could bring many of the benefits.
Drug companies take the anti-Amazon pill 27 Mar 2018 Novartis is selling its consumer health assets to GSK for $13 bln. It makes sense for the former to focus on traditional drugs given the threat from e-commerce. For the latter, the purchase is less risky than a Pfizer deal and may still allow investment in its core business.
Market jitters accentuate M&A regulatory risk 26 Mar 2018 Dealmaking sprees are prone to extinction events. Market panics erode the value of buyers’ stock, make bankers reluctant to lend, and change the outlook violently. Recent tumult doesn’t yet qualify, but it makes it harder to overlook deals that push the regulatory limits.
Self-driving cars may find legal lesson in pharma 22 Mar 2018 Autonomous vehicles should make road deaths like the one involving an Uber prototype a rarity. Paradoxically, as drugmakers found with vaccines, mishaps may raise legal costs and drive companies out of the market. Limits on suits and a compensation fund balanced risk and reward.
SEC gives wrong Theranos lesson to Silicon Valley 14 Mar 2018 Elizabeth Holmes’ company raised $700 mln in a “massive” fraud that put patient lives at risk. Yet regulators are letting her escape with a slap on the wrist, and not admit guilt. The SEC says this is an important lesson for startups, but it shows how toothless the agency is.
Profit is only part of U.S. healthcare sickness 12 Mar 2018 America spends about 18 pct of GDP on healthcare – almost twice as much as most developed countries. Pricing to reward investors accounts for perhaps a fifth of this gap. High pay, fights over the spoils and the fetishization of costly high-tech medicine are other factors.
Cigna pays over the odds for uncertain benefit 8 Mar 2018 The insurer is paying $54 bln for pharmacy middleman Express Scripts in the latest healthcare consolidation move. Express’s business has stalled and the FDA’s campaign for drug-price transparency threatens its model. Cigna’s $13 bln premium is not a sure prescription for growth.
Akorn deal could crack M&A MAC nut 6 Mar 2018 Merger escape clauses are notoriously hard to trigger. Even performance woes at drugmaker Akorn aren’t enough for Fresenius to demand a discount on an agreed $4.3 bln tie-up. If the German healthcare group can prove Akorn misled regulators, though, it is a different story.
Hadas: Billy Graham’s great missed economic chance 26 Feb 2018 The evangelist, who died last week, lived through a global debate over the Christian responsibility to help society. He put preaching before activism. If he had spoken out – as many European Catholics did – America might have a stronger welfare system now, and less populism.
Siemens’ $50 bln IPO may be first step to breakup 19 Feb 2018 The German industrial giant’s shares could be worth 25 pct more if a sale of its healthcare unit lifts a conglomerate discount. But investors may still balk at owning a company with listed stakes in disparate sectors like wind and rail. In that case, calls for a breakup may grow.
Walgreens Boots mulls $20 bln back-to-future deal 13 Feb 2018 Stefano Pessina’s dealmaking turned a small Italian drug distributor into a $68 bln drugstore chain. Buying out wholesaler AmerisourceBergen would take the business full circle, tighten the firm’s U.S. supply chain, and set up future deals to fend off the new threat: Amazon.
Bill Gates and buyout baron create negative impact 5 Feb 2018 The billionaire’s Gates Foundation is at odds with Abraaj, a buyout group, over a $1 bln fund to provide healthcare in emerging markets. The dispute underscores the tension in combining charitable and financial goals. The fallout will only fuel skepticism of impact investing.
U.S. healthcare bloat faces new triple threat 30 Jan 2018 Amazon, Berkshire Hathaway and JPMorgan are getting together to cut medical costs. Details are few and obstacles many, but they bring relevant skills and a lot of employees to the mix. A multibillion-dollar hit to health-sector stocks shows the shakiness of the status quo.
U.S. flu-shot savings are nothing to sneeze at 25 Jan 2018 A harsh influenza strain is knocking more Americans flat this winter. The tab for medical care should exceed $10 bln, while lost work days will take an even larger toll on companies. Offering free shots for all would be a cost-effective way for society to reduce the burden.
Weed giants share a deserved peace pipe 24 Jan 2018 Canada’s Aurora and rival CanniMed have agreed a friendly merger after months of acrimony. CanniMed’s shareholders only get a small stake in the $6.2 bln combination, but a big uplift in value. The world’s biggest listed weedmaker is now well positioned for regulatory changes.
Ping An’s Big Health plan risks excess success 23 Jan 2018 A $9 bln unit of the Chinese insurer that analyses patient data has lured backers like SoftBank, Reuters reports. The digital upgrade of China’s clunky medical system is a lucrative opportunity for private firms. Data security is a risk; getting too big, too quickly may be worse.
Insurance M&A benefits from thin U.S. safety net 19 Jan 2018 Lincoln National is paying $1.4 bln for Liberty Mutual’s employer-based insurance business. It gives the buyer added heft in a growing field as more Americans top up life, health and disability coverage through the workplace. Cost cuts give this deal an added bit of assurance.
Celgene readies $10 bln mix of need and hope 17 Jan 2018 The drug group may buy Juno Therapeutics, a biotech promising ways to modify immune cells to fight cancer. The two already have a partnership, but Celgene needs to grow. If it’s also sensing real potential, it could pay an eye-watering price for a firm with no approved products.
Celgene puts shareholders on $7 bln M&A trial 8 Jan 2018 Buying privately held cancer specialist Impact Biomedicines may help the biotech giant refill its pipeline after recent drug flops. Insisting on a series of earnouts based on sales reduces risk. But Celgene needs more than a booster shot to cure longer-term ailments.
M&A frenzy sets scene for epic tug-of-war 3 Jan 2018 The $3.6 trln of mergers announced in 2017, including huge deals from Disney and Broadcom, sets up some chunky targets for cost cuts. That means job losses, even if buyers say not. Yet given the political climate, shareholders can’t count on the extra profit being theirs to keep.