Fwd: US Healthcare Year Ahead...Buy ACAD, AGN, ANTM, CELG, CVS, DHR, EW, EVHC, RARE, REGN, WBA
[{"sender": "Ens, Amanda", "recipients": ["Rich Kahn"], "timestamp": "December 15, 2016 at 10:59:39 AM EST", "subject": "US Healthcare Year Ahead...Buy ACAD, AGN, ANTM, CELG, CVS, DHR, EW, EVHC, RARE, REGN, WBA", "body": "The US team is out with their 2017 Year Ahead this morning (link) running through ALL sub-sectors with each analysts top pick into the new year. op Picks — ACAD, AGN, ANTM, CELG, CVS, DHR, EW, EVHC, RARE, REGN, WBA Washington DC Backdrop Given the clean sweep by the GOP & uncertainty around the ACA, key attention is paid by Andy Bressler to a review of the various scenarios that could play out early next year. With a repeal likely to happen well before a replace (essentially via the Budget Reconciliation process in Jan/Feb), Andy notes this is likely to include a repeal of both health insurance exchange subsidies & a phase-down of Medicaid expansion funding (albeit with a two or three year transition period). He also expects a repeal of many of the larger HC related taxes in the ACA, including the HIX ($14.3bn in 2018), Medtech Tax (2.3%), pharma industry tax ($4.1bn in 2018) & Cadillac tax (effective 2020). As for the views by analysts... Biotech (+) — believe sector will outperform largely as pricing risk has diminished (although will remain in pockets) but pipelines/growth remains. Ying's top picks are CELG & REGN; Tazeen's top picks are kCAD & RARE. Spec Pharma (-) — headwinds remain w/ Sumant's top pick AGN given lower risk to reimbursement pressures & an underappreciated pipeline. Leverage & CF remain the key focus for investors. Tools/Animal Health (=) — Derik notes more \"headline\" than \"real\" risks from policy which will create opportunities for a group growing MSD, although valuations remain above peers. (US 1 name) top pick, also A, ZTS in Animal Health, in Diagnostics & in Services. Medtech (=) — Hopkins' expects a mixed bag in 2017 w/ stocks trading close to 5yr valuation lows; EW top pick given best growth / purest innovation story. Facilities (-) — Fischbeck notes that uncertainty will remain an overhang for hospitals as repeal/replace a negative for the group (est losing 2-3mm Medicaid lives & 2-3mm exchange lives would be a 1-2% EBITDA hit on avg). Focus on company-specific stories like MCOs (+) — Fischbeck generally +ve under Trump (especially around MA given historical support from GOP) w/ tailwinds from corporate tax & rising rates. top pick in given valuation & tailwinds. Distribution/Tech (=) — Valiquette prefers pharmacies ,,,'VS/WBA given benefits from decelerating generic prices (which will remain an overhang for Distributors). HHS appointment a —ve for HCIT."}, {"sender": "Richard Kahn", "recipients": ["jeffrey E. [jeevacation@gmail.com]"], "timestamp": "12/15/2016 5:46:20 PM", "subject": "Fwd: US Healthcare Year Ahead...Buy ACAD, AGN, ANTM, CELG, CVS, DHR, EW, EVHC, RARE, REGN, WBA", "body": "attached are equity healthcare ideas"}]