Catholic Health admissions, outpatient visits drop

Catholic Health Initiatives saw admissions and outpatient visits drop during the third quarter of its fiscal 2018, and the not-for-profit health system’s loss from operations widened.

Englewood, Colo.-based CHI reported a $35.3 million operating loss in the quarter, steeper than its $17.2 million operating loss reported during the same period the prior year.

The health system’s operating earnings before interest, depreciation and amortization fell during the quarter to $249 million, down 4.2% from $260 million in the third quarter of 2017. The system’s operating EBIDA margin rounded out the quarter at 6.7%.

After adjusting for transactional gains and other items, CHI said its operating EBIDA improved nearly $80 million during the quarter, ended March 31.

CHI reported a net loss of $12.3 million, compared with net income of $178.2 million during the same period in 2017.

CHI’s report announcing the earnings said that its performance reflects the system’s ongoing improvement plan. Total restructuring, impairment and other losses declined nearly $50 million in the third quarter of 2018. Those losses were about $11 million in the quarter.

Operating revenue fell about 3.5% in the third quarter to $3.7 billion, while operating expenses before restructuring fell 1.7% to $3.7 billion.

CHI’s acute admissions declined 7.7% during the quarter to 111,500, while its acute inpatient days fell 6.3% to 555,723. Outpatient emergency room visits fell 4.5% to 464,282. Non-emergency outpatient visits fell nearly 7% to 1.3 million. Physician visits, by contrast, increased 5.8% during the quarter to almost 2.9 million.

CHI wrote that its consolidated results took a hit from the decline in overall capital markets, which generated both unfavorable investment returns and positive swap performance for the third quarter of fiscal 2018 compared to same period in 2017.

“We continue to see strong momentum that has played out in the current fiscal year,” Dean Swindle, CHI’s chief financial officer, wrote in a statement. “We have established a strong foundation through a performance-improvement plan stretching back nearly three years, and we expect that these positive results will continue throughout the rest of this fiscal year and well beyond as we become a truly high-performing health system.”

https://bit.ly/2KUstUD

Healthcare Stocks ‘Love’ Trump’s Putting ‘American Patients First’ Plan

While stocks initially dipped on the speech, it soon became clear to the machines and the manipulators that, perhaps, there was not much there, there… and all aspects of healthcare soared…

Biotechs dipped and ripped…

Supply Chain dumped and pumped…

Pharmacies puked then exploded…

We are just going to leave this here for your consideration…

Senior administration officials have pre-empted Trump’s speech which proposes a sweeping effort to bring down US drug prices. Bloomberg reports that the blueprint, called American Patients First, is meant to increase competition and lower patients’ out-of-pocket costs. It would lift rules that prevent government programs from getting better drug discounts, push other developed nations with tighter price controls to pay more, create incentives to lower list prices and try to prevent drugmakers from gaming the system to extend their monopolies.

“One of my greatest priorities is to reduce the price of prescription drugs,” Trump said in a statement distributed by the officials.

As we detailed earlier, the plan is expected to:

• “… aim to increase competition by ending ‘the gaming of rules’ by brand-name drug manufacturers that stymies the introduction of cost-saving generic and biosimilar drugs.

• “… seek to improve negotiation within the Medicare program, but not by using the government’s clout to negotiate for Medicare as Trump has previously proposed. It would create unspecified incentives for lower list prices of drugs and would lower out-of-pocket spending by patients.”

• Lobbyists and industry insiders think Trump will take particular aim at middlemen known as “pharmacy benefit managers” (PBMs) – who negotiate drug coverages, payments and rebates between insurers and drug makers.

Here’s what PBMs are watching most nervously: Whether Trump aims at narrowing the spread between high list prices and the secret, rebate prices insurers actually pay by limiting rebates to a percentage of the list price. –WaPo

• Trump is expected to knock “unfair” practices by other countries which negotiate their drug prices. “Right now it’s very unfair what other countries are doing to us,” Trump remarked at a meeting with pharmaceutical executives in late January, accusing countries of “global freeloading,” and saying that it’s “very, very unfair” that the U.S. pays so much more for drugs.

• At the January sitdown, Trump noted that the price for over-the-counter drugs such as aspirin, saying “The numbers we pay — I mean we have cases where, if I go to a drugstore and buy aspirin, the aspirin costs me less than what the United States pays for aspirin,” adding “So I can buy at a drugstore, the aspirin, for less money. … But we have to do something about that.”

White House Domestic Policy Council’s Katy Talento noted on Wednesday at an Independent Women’s Forum discussion that there’s “no ox that won’t be gored” in today’s 2 p.m. address.

“This is a fearless president and he doesn’t know or care why things have always been done…It’s not like your typical Republican authorizing committee that protects this model that they helped write for decades,” said Talento.

However, market participants are not expecting dramatic change… and the Nasdaq Biotech Index is jumping today…

“We expect more rhetoric than reform,” Height Securities analysts wrote in a note on Friday. “The President’s bark will be worse than his bite as he blames all parties within the drug supply distribution chain” for high prices.

Watch Live at 2pmET…

https://bit.ly/2If5DFu

Trump: Other nations extort drug-makers

US President Donald Trump has accused foreign governments of extorting “unreasonably low drug prices” from pharmaceutical firms.

Speaking in Washington on Friday, he said he had directed his top trade official to make the issue a priority in trade talks.

“It is time to end the global free loading once and for all,” he said.

The president is under pressure to deliver on campaign promises to reduce the high costs of prescription drugs.

In his speech, the president partially blamed the high prices on price controls in other countries that he said “extort unreasonably low prices” from companies, forcing Americans to pay more to “subsidise the enormous costs of research and development”.

“That is unacceptable,” he said.

However, experts say foreign pricing is not a major influence on US costs and changing it will not help Americans.

“The notion that if other countries pay more for drugs that US consumers will pay less, that’s just not true,” said Paul Ginsburg, a professor of health policy at USC and the director of the USC-Brookings Schaeffer Initiative for Health Policy.

Mr Ginsburg said firms set prices to maximise profits and already have ample incentives to innovate.

“If they are able to get other countries to pay more, I don’t believe it will have any effect on prices in the United States,” he said. “It will only raise drug company profits.”

Shares of health care companies jumped after the speech.

Higher costs

Polls repeatedly find that reducing the high cost of prescription drugs is a priority for American voters.

The US spent $1,443 per capita on pharmaceutical costs in 2016, compared to a range of $466 to $939 in 10 other high income countries, including the UK, Australia, Canada and Japan, according to a study in the Journal of the American Medical Association.

The report said those costs were one of the primary drivers of overall US health spending, which was nearly twice as high as in the other countries.

President Donald Trump seized on the issue during his 2016 election campaign.

At the time, he had said the government should negotiate drug prices for government health programmes, such as Medicare. He also voiced support for allowing people to buy medicines from countries where they cost less, such as Canada.

Neither of those proposals was mentioned in Friday’s speech.

Details of the plan

The White House said its focus is on increasing competition among drug manufacturers, by speeding up approvals for generic drugs and cracking down on the “gaming” of intellectual property patents.

A blueprint released on Friday also calls for requiring disclosure of out-of-pocket costs prior to giving prescriptions and for ending rules that limit what pharmacists can share about costs, among other measures.

Gerard Anderson, a professor of health policy at Johns Hopkins University said it is too early to say whether the ideas will have an impact on prices, and too early to gauge their political effect.

“I don’t know how the American public is going to respond,” Mr Anderson said. “It clearly does not meet what President Trump said he was going to do when he was elected.”

He also said he does not think making drug prices a focus of trade talks will lead other countries to make changes.

“I don’t expect that any country is going to say, ‘Oh, we’re going to increase our prices because President Trump wants it’,” he said.

https://bbc.in/2KdeUP0

Fosun joins Aurobindo, PE firms in final bids for Novartis’ $2B U.S. generics assets

It turns out India’s Aurobindo is not the only one hot to buy a portfolio of Novartis’ U.S. generic assets, including its dermatology business.

China’s Fosun Pharma and private equity firms Apollo Global Management and CVC Capital Partners have also been shortlisted to make final offers, Bloomberg reported, citing people with knowledge of the talks.

The combined value of those assets on the for-sale list could reach $2 billion, and a buyer could be determined within the next few weeks, sources told Bloomberg.

Novartis has said since at least January that it’s looking to sell its U.S. generics oral solids business and other noncore products to concentrate on higher-margin generics. For the first quarter, Sandoz’s sales in the U.S. declined 18% as pricing pressure takes a toll on all generic producers.

Novartis definitely has some Sandoz products it will keep. In a statement sent to FiercePharma, Novartis said it has no intention to selling off the Sandoz business in the U.S. altogether, and if it sells off pieces, its remaining U.S. portfolio would still include complex generics, biosimilars, ophthalmics, value-added medicines, injectables and several oral solid portfolios in certain areas like oncology.

The composition of suitors—Chinese and Indian drugmakers and PE firms—looks familiar for a major generics deal. Aurobindo was previously said to be among four Indian firms, an unidentified Chinese pharma and several PE firms sizing up Sanofi’s European generics business, now on the verge of being sold to Advent for $2.4 billion.

CVC Capital Partners just took in part of Teva’s women’s health assets for $703 million last September. And going back to March of last year, CVC was reportedly talking to both Fosun and Shanghai Pharma about a joint effort in scooping up Stada.

Both China and India rely heavily on generics. But Indian firms have gone far ahead in their expansions into developed markets, while Chinese generics makers have traditionally only been serving their domestic market. In 2017, only 38 generic drugs approved by the U.S. FDA went to Chinese manufacturers, while Indian firms got 300, according to the Financial Times.

The Chinese government has been pushing to reshape its generics landscape. It’s in the process of a generics re-evaluation campaign aiming to push out small players who live on cheap, low-quality products. And the government just recently rolled out a new policy that promises tax incentives to qualified generics makers. Getting an established business with a portfolio of approved products and existing foreign operations would for sure give a Chinese player like Fosun an easier entry into the Western market.

https://bit.ly/2rzQ2dk

Omeros buy reiterated by Wainwright

Omeros (NASDAQ:OMER) shares are soaring today after the drug maker reported quarterly results, and there’s a lot more fuel in the tank to propel it even higher, at least according to H.C. Wainwright analyst Ram Selvaraju.

In a research note issued this morning, Selvaraju reiterated a Buy rating on OMER stock, with a price target of $34, which implies an upside of 88% from current levels. (To watch Selvaraju’s track record, click here)

Omeros reported Q1 with $1.6 million from Omidria revenues. The decrease from $13.8 million was largely attributed to the loss of pass-through status on January 1 (which will be reinstated in October). Omeros reported a net loss for the quarter of $30 million, and a cash balance of $73 million, which does not include $45 million from the credit facility which Omeros has requested.

Selvaraju commented, “We continue to anticipate that OMIDRIA revenues should gradually rise in the second and third quarters, before accelerating markedly in the final couple of months of 2018 when reimbursement resumes. The company recorded a net loss of $0.62 per share, precisely in line with our forecast. We have modestly revised our estimates for 2018, which are now at a loss per share of $2.22 vs. the prior loss per share of $2.24. Our 2019 earnings estimate now stands at $0.21 vs. the prior $0.02 per share, reflecting our expectation that Omeros should turn cash flow-positive in 2H19 along with our projection that revenue from sales of OMS721 could begin next year if the FDA were to agree to grant accelerated approval in the HSCT-TMA indication.”

“We believe investors should focus on the fact that Omeros closed the first quarter with a solid cash and short-term investments position of $72.8M, and that the company has indicated its draw-down of the remaining $45M loan facility tranche with CRG this month, further bolstering its resources. Based on our projections, we believe Omeros could reach cash flow-positive status next year without requiring significant additional capital,” the analyst added.

https://bit.ly/2KeBI0E

Intrexon misses views

Intrexon (NYSE:XON) issued its quarterly earnings data on Thursday. The biotechnology company reported ($0.33) earnings per share (EPS) for the quarter, missing the consensus estimate of ($0.24) by ($0.09), Briefing.com reports. The business had revenue of $43.80 million during the quarter, compared to the consensus estimate of $60.43 million. Intrexon had a negative return on equity of 16.94% and a negative net margin of 50.61%. The company’s revenue for the quarter was down 18.4% on a year-over-year basis. During the same quarter in the prior year, the company posted ($0.26) earnings per share.
https://bit.ly/2KTBJs0

Iovance target upped by B. Riley FBR

Iovance price target raised to $24 from $22 at B. Riley FBR. B. Riley FBR analyst Madhu Kumar raised his price target for Iovance Biotherapeutics to $24 following last night’s Q1 results. The analyst believes FDA interactions in Q3 could set an approval path for melanoma TILs. He reiterates a Buy rating on the shares.

https://bit.ly/2Ig6fKW