CVS Delivers Strong First-Quarter Results, Soothing Fears About Fallout From Aetna Acquisition
CVS shares lost a third of their value after the completion of the Aetna deal, erasing roughly $34 billion of market value. On Wednesdays, the shares were up 5% at about $57 in afternoon trading. In other health industry news: more first-quarter results, the challenge of working with technology, mental health training and more.
Reuters:
CVS Health Raises Full-Year Profit Forecast On Aetna Strength
CVS Health Corp on Wednesday raised its full-year profit forecast and reported first-quarter earnings that topped Wall Street estimates due to growth in its Aetna health insurance business, and as drug prices fell within its expectations. Shares rose more than 5 percent to $57.35. They had fallen 17 percent this year, hurt by a weak forecast in February and a cut to rival Walgreen Boots Alliance's full-year outlook last month due to lower generic drug prices. (5/1)
The Wall Street Journal:
CVS Eases Concerns About Aetna Deal
The first-quarter results mark a shift from February when the Woonsocket, R.I.-based company offered a downbeat earnings projection for 2019 that sent shares tumbling. The latest performance also distinguishes CVS from rival Walgreens Boots Alliance Inc., which reported weaker profits in the most recent quarter and lowered its forecast citing weaker profit from generic-drug sales. “Considering that expectations have been low, we see this as the first positive catalyst that restores investor confidence in this management team,” SVB Leerink analyst Ana Gupte said. (Terlep and Wilde Mathews, 5/1)
Modern Healthcare:
CVS Health's First-Quarter Earnings Get A Boost From Aetna
CVS piloted three "HealthHUB" stores in Houston earlier this year and now plans to expand them to the rest of the Houston market. The stores are meant to help manage patients' care in between physician visits by offering a range of healthcare services, digital tools, on-demand health kiosks, and chronic care management services. The Houston stores also include an in-house dietitian who offers personal and group nutrition counseling. "These new store formats illustrate how CVS Health is evolving and differentiating to address the changing healthcare landscape," Merlo said. "And while it is early we are very encouraged by the initial results in our Houston stores. The various product and service offerings are performing at or above our expectations."(Livingston, 5/1)
Reuters:
Fitbit Results Beat Street As Demand For Wearable Devices Climb
Wearable device maker Fitbit Inc reported better-than expected first-quarter results and reaffirmed its full-year revenue forecast on Wednesday, as it sells more smartwatches and wearable devices that track health at affordable prices. Shares of the company rose 1.5 percent to $5.45 in late trade. Fitbit, which helped pioneer the wearable devices craze, posted year-over-year trackers growth for the first time in three years, getting a boost from its new Inspire line. Smartwatch sales also more than doubled in the quarter. (5/1)
The Wall Street Journal:
CEOs In Health Care Discuss Challenges Of Working With Artificial Intelligence
Technology is reshaping health care, from pharmaceutical research to detecting opioid addiction, but the magnitude and pace of change isn’t always as dramatic as some had hoped a few years ago, industry leaders said at The Wall Street Journal Health Forum on Tuesday. Novartis AG Chief Executive Vas Narasimhan said that for now, the opportunities presented by artificial intelligence are on the margin. “It’s another tool in the toolbox,” he said. (Walker, Loftus and Abbott, 5/1)
Modern Healthcare:
Walgreens To Train Pharmacy Staff In Mental Health First Aid
Walgreens Boots Alliance launched a training program for pharmacists to learn how to better identify warning signs of mental health and substance use problems in their patients and help them during crisis situations. The retailer partnered with the American Pharmacists Association and the National Council for Behavioral Health to create an online version of the Mental Health First Aid program, which was developed in 2001 in Australia to provide individuals who weren't clinicians with strategies to help someone experiencing a mental health crisis. (Johnson, 5/1)
Modern Healthcare:
Former HMA CEO To Pay $3.5 Million Over False Billing Allegations
The former CEO of Health Management Associates has agreed to pay nearly $3.5 million to settle false claims and kickback allegations, the U.S. Justice Department announced Tuesday. The False Claims Act settlement resolves the government's assertion that Gary Newsome oversaw unnecessary patient admissions and the subsequent billing of government healthcare programs for more expensive services. It also settles allegations that Newsome caused HMA to pay kickbacks to emergency department physicians in return for referrals. (Bannow, 5/1)
Stat:
A Theranos Scientist-Turned-Whistleblower, On Jail Time For Elizabeth Holmes
She joined Theranos fresh out of the University of California at Berkeley, a self-described “starry-eyed’’ 22-year-old chemist and biologist who saw Elizabeth Holmes as a role model: the CEO who would revolutionize the blood testing industry. Seven months later, Erika Cheung quit her job as a lab associate at the company and became a disillusioned whistleblower, her life now enveloped by one of the biggest business scandals in American history. She was among those who had made clear to federal regulators that she viewed Holmes as a liar who had put patients at risk. (Holmes, and her company’s former president, Ramesh Balwani, have been indicted on charges of defrauding investors out of hundreds of millions of dollars as well as deceiving hundreds of patients and doctors.) (Berke, 5/1)
