Health care industry update As of October 10 2007
There has been a lot of activity in the broad market for the healthcare industry. Many of the top stories have to do with international markets. Many analysts remain bullish on the industry has a whole, as they expect it to continue double digit growth in many areas.
Ruppe Appreciation on HealthCare costs
The appreciation of the rupee is hurting the exports for the Health Care sector in India causing many of their goods and services to become overpriced in relation to the dollar.
IPO
Highlands Acquisition Corp announced today that it has completed its initial public offering of 12,000,000 units. Each unit consists of one share of common stock and one warrant, which entitles the holder to purchase one share of common stock. The units were sold at an offering price of $10.00 per unit, generating gross proceeds of $120,000,000 to the Company.
Look who they are targeting…..
Highlands Acquisition Corp. is a newly organized blank check company formed for the purpose of effecting a merger, capital stock exchange, stock purchase, asset acquisition or other similar business combination with one or more operating businesses. The Company initially intends to focus its search for a target business in the healthcare industry.
Chinas role
Chinas pharmaceutical industry is expected to grow by 18% by 2010.
Recently Zhejiang Huahai Pharmaceutical Co., the Chinese drug maker that won FDA approval. Look for a trend of China having a larger role in the industry.
Pfizer As part of a broad effort to invigorate its pipeline and move more aggressively into biotechnology, Pfizer Inc. announced Thursday a new division dedicated to developing biotherapeutic drugs and research technologies.
Wal-Mart
Wal- Mart announces that they will expand their prescription drug program. They will include three fertility and prescription birth control medications, along with medicines for glaucoma, attention deficit disorder, fungal infections, acne, and more.
Wyeth Eyes Japan
Wyeth seeking approval to launch new pneumonia drug and osteoporosis drug in Japan, as part of its effort to raise sales in Japan to $1 billion by 2010, nearly double that of 2006.
Merck approved to test HIV products
FDA releases its review of Isentress ahead of a panel meeting and finds that any negative side effects from the HIV drug aren't enough to keep it off the market.
Health care plan costs
Employers' health-insurance premiums up 6.1% in 2007, the slowest annual growth rate since 1999 but still outstripping gains in workers' earnings and general inflation.
Wednesday, October 10, 2007
Tuesday, October 9, 2007
MMM Economic Outlook
MMM Economic Outlook 10/10/07
Seven weeks ago markets were down across the board because in times a high volatility (like now) markets become highly correlated. As of today markets are back on top after news that the credit crunch was soon to be behind us. The S&P 500 set a new high on Friday and the DOW is back above 14,000. Resources, Industrials and Technology have led since august lows. Gold hit a new 27 year high last week. All commodities are down beginning the week of 10/8; oil, copper, gold are down causing the shares to fall of several companies connected to these commodities. Year to date, commodities across the board are strong. According to RBC Capital markets, “Commodity strength is likely reflecting more than just US dollar weakness, and that it is consistent with the containment of credit market risks to global growth.” According to Allan Greenspan, if the dollar becomes weak (problematic) then there would be an acceleration in inflation. Recession is the word on everyone’s mind. According to Gene Epstein of Barron’s, “…A recession has less than a 20% chance of occurring… The weaknesses in housing and consumer expectations are both clearly voting thumbs-down. But the two employment indicators and the stock market are holding up pretty well. And more crucially, the real rate on federal funds is relatively accommodative in historical terms”
-The Commerce Department reported that orders to factories dropped 3.3%, lowest in 7 months. (Durable goods down 4.9%, non-durable goods down 1.6%, Autos down 8.5%)
-Jobs created in August originally reported a loss of 4000 but was revised to a gain of 89,000 and 110,000 in September. ( in line with estimates)
***The fed would more likely cut rates if job creation numbers fall short. Therefore, the stock market would react more favorably if the numbers fall short.
-The dollar has touched new lows against the Looney, Euro, Pound, and Yen in the past week.
As our national research source says, “While the risk of recession increased during the August financial panic, our estimates suggest that it has declined noticeably in the wake of the Fed’s September interest rate reduction.” They further note that since 1950, the economy has been in a state of recession only 13% of the time; in the past 20 years, that figure drops to only 6% of the time. In the past 20 years, market crises clearly have greatly outnumbered the number of recessions predicted by them. Of the last 11 market crises, the market resumed an uptrend on all but two occasions. Recessions tend to share common traits we believe remain largely absent today: Unemployment rises (absent today); Stock prices fall (we’re back to old highs); Yield curve inverts (it’s resuming a more normal shape now); Consumer confidence declines (okay, we’ve got that one
present). This 12-month model, designed by our national research source, shows a 13% current chance of a recession, compared with a 25% chance in prior to September. And—this recent recession panic was not the year’s high point—that was reached in March (when it rose to a 36% chance of a recession) as jobless claims rose, energy prices surge, and the yield curve inversion deepened (RBC).
Seven weeks ago markets were down across the board because in times a high volatility (like now) markets become highly correlated. As of today markets are back on top after news that the credit crunch was soon to be behind us. The S&P 500 set a new high on Friday and the DOW is back above 14,000. Resources, Industrials and Technology have led since august lows. Gold hit a new 27 year high last week. All commodities are down beginning the week of 10/8; oil, copper, gold are down causing the shares to fall of several companies connected to these commodities. Year to date, commodities across the board are strong. According to RBC Capital markets, “Commodity strength is likely reflecting more than just US dollar weakness, and that it is consistent with the containment of credit market risks to global growth.” According to Allan Greenspan, if the dollar becomes weak (problematic) then there would be an acceleration in inflation. Recession is the word on everyone’s mind. According to Gene Epstein of Barron’s, “…A recession has less than a 20% chance of occurring… The weaknesses in housing and consumer expectations are both clearly voting thumbs-down. But the two employment indicators and the stock market are holding up pretty well. And more crucially, the real rate on federal funds is relatively accommodative in historical terms”
-The Commerce Department reported that orders to factories dropped 3.3%, lowest in 7 months. (Durable goods down 4.9%, non-durable goods down 1.6%, Autos down 8.5%)
-Jobs created in August originally reported a loss of 4000 but was revised to a gain of 89,000 and 110,000 in September. ( in line with estimates)
***The fed would more likely cut rates if job creation numbers fall short. Therefore, the stock market would react more favorably if the numbers fall short.
-The dollar has touched new lows against the Looney, Euro, Pound, and Yen in the past week.
As our national research source says, “While the risk of recession increased during the August financial panic, our estimates suggest that it has declined noticeably in the wake of the Fed’s September interest rate reduction.” They further note that since 1950, the economy has been in a state of recession only 13% of the time; in the past 20 years, that figure drops to only 6% of the time. In the past 20 years, market crises clearly have greatly outnumbered the number of recessions predicted by them. Of the last 11 market crises, the market resumed an uptrend on all but two occasions. Recessions tend to share common traits we believe remain largely absent today: Unemployment rises (absent today); Stock prices fall (we’re back to old highs); Yield curve inverts (it’s resuming a more normal shape now); Consumer confidence declines (okay, we’ve got that one
present). This 12-month model, designed by our national research source, shows a 13% current chance of a recession, compared with a 25% chance in prior to September. And—this recent recession panic was not the year’s high point—that was reached in March (when it rose to a 36% chance of a recession) as jobless claims rose, energy prices surge, and the yield curve inversion deepened (RBC).
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