Threats To Marketplace From Lawmakers, Administration Wearing Thin On Health Care Investors
"There are a significant number of investors who are completely on the sidelines from the industry,” SVB Leerink biopharma analyst Geoffrey Porges said. “And you can pick your ‘until’: until the proposed rule on Medicare international reference pricing is announced, or until the next Democratic debate, or until the election. There’s a lot of ‘until’s.”
Bloomberg:
Health Investors Struggle Under Weight Of Washington What-Ifs
Optimism is in short supply when it comes to health-care stocks as investors can’t see when the sector will recover from an array of regulatory threats. Plagued by concerns about drug pricing and jitters over proposals for a U.S. government-run system, health care has gone from the top-performing group in the S&P 500 Index last year to its worst in 2019. Facing an election in less than 16 months, President Donald Trump may have run out of time in this term to enact meaningful changes affecting the industry, but observers say political questions are still likely to overshadow business fundamentals. (Darie, 7/24)
In other news —
Bloomberg:
Health Insurers Sink As Rising Spending Gauge Alarms Investors
Health-insurance stocks sank across the board after Anthem Inc. became the third insurer to report it is paying out a higher percentage of the premiums it takes in to cover patients’ medical claims. Investors watch the so-called medical-loss ratio reported by health insurers closely. The number is a key measure of the companies’ financial health; when the ratio goes up, it can suggest that money is leaving the companies faster than it is arriving. Other issues, such as changes in tax law, can also affect the ratio. (Tozzi, 7/24)
Modern Healthcare:
Dermatology Practices Being Bought By Investors Raises Concerns
Private equity firms have acquired nearly 200 dermatology practices across the country over the past six years, raising concerns about how this ownership trend affects quality and costs, according to the most comprehensive study so far tracking these deals. The JAMA Dermatology study found that 17 private equity-backed dermatology management groups rolled up 184 practices from 2012 to 2018, accounting for 381 clinics in at least 30 states. More than a third of the clinics were located in Florida and Texas. (Meyer, 7/24)
