We track Emerging Markets growth rates for our covered companies. It has accelerated consistently since mid-2016; in Q3 2018 it was 11.6% y/y. From Q1 2012 to Q3 2018, y/y growth has been: 6.4% (10.3% (9.1% (9.5% (6.4% (10.3% (9.1% (9.5% (7.4% (6.1% (3.9% (9.5% (6.4% (8.3% (10.9% (8.0% (7.5% (4.7% (3.6% (3.2% (4.4% (1.8% (3.6% (3.3% (5.8% (6.1% (7.4% (7.5% (9.1% (9.5% (11.6% (Exhibit 1).
Search Coverage List, Models & Reports
Search Results1-10 out of 11
This report covers the bull/bear case, current controversies, relative growth prospects and more for our 10 US & EU global pharmaceutical companies.
The Medicare coverage gap, aka “donut hole”, has been a component of the Medicare Part D program since it was established in 2003. The presumed intent of the donut hole was to increase patients’ financial responsibility during some part of their care, with the hope that they would help contribute to making rational drug choice decisions. However, the enactment of the Patient Protection and Affordable Care Act (the “ACA”) in 2010 has sought to undo this – it encompassed legislation to lower beneficiaries’ financial exposure, with the goal of eliminating it completely by 2020.
On Wednesday morning (12/12/18), JNJ (not covered, $146. 52) announced detailed results from its ECLIPSE study at ISDS. ECLIPSE, a phase 3 head-to-head trial comparing JNJ’s Tremfya (guselkumab, IL23) vs. NOVN’s Cosentyx (secukinumab, IL17) in psoriasis, is something we’ve tracked since early 2018 and has grown increasingly present on investors’ radars. We flagged this trial as a source of binary event risk ahead of NOVN when we reinitiated coverage in October, as we felt the chances of a positive outcome were likely skewed in JNJ’s favor (i.e. chose a primary endpoint where Tremfya had the highest probability of success).
We recently wrote a brief investor update on the investment case for BMY (BMY: Summarizing the Investment Case). In it, we said that it is time to move on from the idea that Opdivo+Yervoy in lung cancer is going to work. This is because the totality of the evidence thus far (from both BMY and AZN) has been that anti-CTLA4 therapies just don’t seem to do much in this particular tumor type. A bearish view on CTLA4 is not a thesis change for us, but for many of the former “bulls” on the stock it has been, and it is one of the reasons BMY shares have struggled.
On November 19th, we published a report (Global Pharmaceuticals - Removal of "Protected Drug Class" Status Coming?) claiming that the Administration may seek to change language related to the six “protected drug classes” in the near-term. Proposed changes have just been released (along with other proposals aimed at helping to manage healthcare spending; not addressed in this report). These proposals are not finalized, meaning it is not clear what ultimately survives the comment period that comes next; implementation would likely begin in 2020.
Presently, six classes of drugs are protected from aggressive formulary management in Medicare Part D plans. This “protected drug class” policy came into effect in 2003 when Medicare Part D was first established.
Novartis held a 4.5hr teach-in on a variety of later-stage R&D programs. There were no major new disclosures, but a lot of incremental detail. The meeting reaffirmed our positive view of the company. Its core R&D abilities are solid, and it is a catalyst-rich pipeline story in the near-term.
We continue to like Novartis as one of the easier stories to tell. It has decent growth, a full pipeline, and a comparatively low risk profile. New CEO Vas Narasimhan has executed on quarterly performance since taking over in February, and the outlook is bright. Despite
all of this, investor expectations on the stock have been mixed (but slowly improving). The bear case stems from three things primarily: first, the company has a long history of over-promising and under-delivering (“snatching defeat from the jaws of victory”); second, the company suffered a black eye from the very slow launch of heart failure drug Entresto; and third, its once market-leading Alcon eye-care division was run into the ground.
We’re re-establishing coverage on Global Pharmaceuticals. This includes five US- and five EU-based large cap, multinational drug companies that we’ve known for a long time.
- 1 of 2
- next →