Healthcare Weekly Report 12-3 - Nathan Wong

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5 Δεκ 2012 (πριν από 4 χρόνια και 8 μήνες)

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Weekly Update: Healthcare Industry

(week ending
12/3
/2010)


Healthcare
Industry Weekly Update


T
he S&P500
surged 2.9
%
last

week
.

The h
ealthcare
sector as a whole represented by
RXL

jumped 2.7
% and
pharmaceuticals
represented by
PPH

climbed

1
.2
%.

The big
advance

could be due to a

more hopeful sign that a compromise can be reached between
the White House and the Republicans on extending the Bush tax cut.


M&A activities in the healthcare sector continued to grow.
The third quarter of 2010 saw
$66.5 billion
in healthcare mergers and acquisitions activity, up 47 percent from the
$45.1 billion spent in the previous quarter, according to a report from Irving Levin
Associates.

Third quarter activity jumped 74 percent from the $38.2 billion spent during
the same t
hree months of last year. A total of 230 mergers and acquisitions were
announced in the healthcare industry between July and September, almost level with the
233 deals announced in the prior quarter, which was up 7% from the 218 deals
announced during the
prior quarter.


R
ECENT
H
EALTH
C
ARE
M&A

D
EALS

B
IOTECHNOLOGY

Acquirer

Target

Price

3SBio, Inc.

Worldwide rights to pegsiticase gout treatment (EnzymeRX)

$6.25 million


M
EDICAL
D
EVICES

Acquirer

Target

Price

Transgenomic

Diagnostic testing business (Clinical
Data, Inc.)

$15.4 million


P
HARMACEUTICALS

Acquirer

Target

Price

Axcan Holdings (TPG Capital)

Eurand NV

$583.0 million



Merck & Co.

SmartCells

$500.0 million



O
THER

Acquirer

Target

Price

Cardinal Health, Inc.

Zuellig Pharma China

$470.0 million



McKesson (MCK)

McKesson

had a
large

decline last week of
3.5
%
from $
6
4.51

the previous Friday
down

to $
66.74

at
last
Friday's close.

The big
surge

was
probably caused by the belief that
McKesson would follow its competitor Cardinal to shop for acquisition targets.
Cardinal
Health acquired Zuellig Pharma
and gained entry to the
China, the world's fastest
-
growing markets.


IHF


In line with the S&P500,

IH
F
was
up

2.87
%

from $
51.61

a week ago Friday

to

$
5
3.09

at
last Friday's close
.
For all the potential headwinds created by the health care bill,
investors should recognize embedded green shoots. Premium intake will likely be buoyed
by a clause in the bill
that mandates an increase in the level of preventive benefits for
screenings and wellness programs. New regulations pose tangible threats to the group,
but portions of the health care

risk premium is slowly being siphoned away. Enough time
has passed to se
e that well
-
managed providers with pricing power and effective cost
management will continue to churn out profits over the short term, and the price chart
indicates bullish health care traders could get healthy as well.