Revenue of $60.35B (+6.7% Y/Y) beats by $510M.
Shares +1.62% PM.
https://seekingalpha.com/news/3505666-unitedhealth-eps-beats-0_12-beats-revenueTuesday, October 15, 2019
Monday, October 14, 2019
Merck to Test Machine Learning to Prevent Drug Shortages
Merck KGaA plans to use analytics and machine learning to predict and
prevent drug shortages, a move that could also save it money.
Currently, the Germany-based pharmaceuticals company needs to stockpile medications to make sure it has enough on hand, meaning some of them expire before they can be used. Merck said its supply-and-demand forecasts are about 85% accurate today.
To sharpen its predictions, the company’s health-care division plans to start testing a cloud-based software platform later this year. The platform, made by North Reading, Mass.-based TraceLink Inc., can analyze in real time data points from various organizations within Merck’s supply chain, including pharmacies, hospitals and wholesale distributors.
TraceLink is now developing machine-learning algorithms that will be used in the pilot, which will begin with immuno-oncology drugs, designed to boost the body’s immune system to fight cancer. “We want to start it in an area where the product is a lifesaving product,” said Alessandro DeLuca, chief information officer for Merck’s health-care division.
“The value is going to be that every single patient will receive the drug that he or she needs at the right moment,” Mr. DeLuca said, adding that the move could significantly cut drug shortages.
The U.S. had roughly 150 to 300 drug shortages every quarter between 2014 and 2019, according to the University of Utah. Shortages can happen due to issues with manufacturing, supply-and-demand forecasts and natural disasters, according to the American Society of Health-System Pharmacists. Common classes of drugs in short supply include antibiotics, chemotherapy and cardiovascular treatments.
Analysts say more precise supply-and-demand forecasts mean pharmaceutical companies could save hundreds of millions of dollars annually, a benefit of not having excess drugs on hand and avoiding costs related to expedited shipments.
On average, pharmaceutical companies carry 156 days of inventory, according to research and advisory firm Gartner Inc. For retailers selling consumer products, it is 78 days. For IT equipment such as printers, servers and PC components, it is 57 days.
Pharmaceutical companies traditionally have predicted demand for drugs based on historical data and input from sales teams. Over the past few years, they have had access to more data about drugs in their supply chain because of a 2013 U.S. regulation that forced manufacturers to add serial numbers to medications, in part to reduce counterfeit drugs.
Drugmakers can use TraceLink’s software to generate such serial numbers, but the platform also acts as a central hub for information about the status of drugs at every phase in the supply chain. As many as 10 entities handle a drug before it gets to a patient, including manufacturers, pharmacies and wholesale distributors, said Shabbir Dahod, TraceLink’s chief executive. “It’s a highly complex supply chain,” he said.
The TraceLink network includes data from more than 275,000 organizations world-wide, including hospitals, retail pharmacies, wholesale distributors and drugmakers. Data about more than six billion serial-numbered drugs runs through the system. Besides Merck, TraceLink customers include Amerigen Pharmaceuticals Inc., Stirling Anglian Pharmaceuticals Ltd. and Morningside Pharmaceuticals Ltd.
TraceLink, founded in 2009, has raised about $167 million in venture-capital funding from investors such as Vulcan Capital, FirstMark Capital, Goldman Sachs Group Inc. and Volition Capital.
To give clients more accurate information about supply and demand, TraceLink is developing machine-learning-based algorithms to analyze the information in its network without violating data-privacy laws.
For example, algorithms could give Merck signals about the days of inventory for a specific drug and how long it will take for a drug to get to a particular phase in the supply chain, Mr. Dahod said. More of that data could also help predict the demand for a particular drug.
Over the past decade, pharmaceutical companies have been facing steep competition from rival brands, generics and biosimilars, said Stephen Meyer, a senior director and supply-chain analyst at Gartner specializing in the life-sciences industry. Investors are pressuring them to become more profitable and free up cash flow to fund product development and mergers and acquisitions, Mr. Meyer said. To that end, many are exploring ways to cut costs in their supply chains.
A better supply-and-demand forecast also makes it easier for Merck to expand into locations without a reliable supply-chain infrastructure, such as parts of Africa and Southeast Asia, said Pepe Rodriguez, managing director and partner at Boston Consulting Group who specializes in operations and supply chains in pharmaceutical companies.
“A lot of growth from pharma companies is coming from emerging markets…and some of the logistics there are challenging,” Mr. Rodriguez said.
https://www.marketscreener.com/MERCK-KGAA-436395/news/Merck-Drugmaker-to-Test-Machine-Learning-to-Prevent-Drug-Shortages-29374412/
Currently, the Germany-based pharmaceuticals company needs to stockpile medications to make sure it has enough on hand, meaning some of them expire before they can be used. Merck said its supply-and-demand forecasts are about 85% accurate today.
To sharpen its predictions, the company’s health-care division plans to start testing a cloud-based software platform later this year. The platform, made by North Reading, Mass.-based TraceLink Inc., can analyze in real time data points from various organizations within Merck’s supply chain, including pharmacies, hospitals and wholesale distributors.
TraceLink is now developing machine-learning algorithms that will be used in the pilot, which will begin with immuno-oncology drugs, designed to boost the body’s immune system to fight cancer. “We want to start it in an area where the product is a lifesaving product,” said Alessandro DeLuca, chief information officer for Merck’s health-care division.
“The value is going to be that every single patient will receive the drug that he or she needs at the right moment,” Mr. DeLuca said, adding that the move could significantly cut drug shortages.
The U.S. had roughly 150 to 300 drug shortages every quarter between 2014 and 2019, according to the University of Utah. Shortages can happen due to issues with manufacturing, supply-and-demand forecasts and natural disasters, according to the American Society of Health-System Pharmacists. Common classes of drugs in short supply include antibiotics, chemotherapy and cardiovascular treatments.
Analysts say more precise supply-and-demand forecasts mean pharmaceutical companies could save hundreds of millions of dollars annually, a benefit of not having excess drugs on hand and avoiding costs related to expedited shipments.
On average, pharmaceutical companies carry 156 days of inventory, according to research and advisory firm Gartner Inc. For retailers selling consumer products, it is 78 days. For IT equipment such as printers, servers and PC components, it is 57 days.
Pharmaceutical companies traditionally have predicted demand for drugs based on historical data and input from sales teams. Over the past few years, they have had access to more data about drugs in their supply chain because of a 2013 U.S. regulation that forced manufacturers to add serial numbers to medications, in part to reduce counterfeit drugs.
Drugmakers can use TraceLink’s software to generate such serial numbers, but the platform also acts as a central hub for information about the status of drugs at every phase in the supply chain. As many as 10 entities handle a drug before it gets to a patient, including manufacturers, pharmacies and wholesale distributors, said Shabbir Dahod, TraceLink’s chief executive. “It’s a highly complex supply chain,” he said.
The TraceLink network includes data from more than 275,000 organizations world-wide, including hospitals, retail pharmacies, wholesale distributors and drugmakers. Data about more than six billion serial-numbered drugs runs through the system. Besides Merck, TraceLink customers include Amerigen Pharmaceuticals Inc., Stirling Anglian Pharmaceuticals Ltd. and Morningside Pharmaceuticals Ltd.
TraceLink, founded in 2009, has raised about $167 million in venture-capital funding from investors such as Vulcan Capital, FirstMark Capital, Goldman Sachs Group Inc. and Volition Capital.
To give clients more accurate information about supply and demand, TraceLink is developing machine-learning-based algorithms to analyze the information in its network without violating data-privacy laws.
For example, algorithms could give Merck signals about the days of inventory for a specific drug and how long it will take for a drug to get to a particular phase in the supply chain, Mr. Dahod said. More of that data could also help predict the demand for a particular drug.
Over the past decade, pharmaceutical companies have been facing steep competition from rival brands, generics and biosimilars, said Stephen Meyer, a senior director and supply-chain analyst at Gartner specializing in the life-sciences industry. Investors are pressuring them to become more profitable and free up cash flow to fund product development and mergers and acquisitions, Mr. Meyer said. To that end, many are exploring ways to cut costs in their supply chains.
A better supply-and-demand forecast also makes it easier for Merck to expand into locations without a reliable supply-chain infrastructure, such as parts of Africa and Southeast Asia, said Pepe Rodriguez, managing director and partner at Boston Consulting Group who specializes in operations and supply chains in pharmaceutical companies.
“A lot of growth from pharma companies is coming from emerging markets…and some of the logistics there are challenging,” Mr. Rodriguez said.
https://www.marketscreener.com/MERCK-KGAA-436395/news/Merck-Drugmaker-to-Test-Machine-Learning-to-Prevent-Drug-Shortages-29374412/
UnitedHealth Likely to Record Higher Sales — Earnings Preview
UnitedHealth Group is scheduled to report results for its fiscal third-quarter premarket on Tuesday. Here’s what you need to know.
EARNINGS FORECAST: Analysts polled by FactSet expect profit of $3.55 a share. They expect UnitedHealth to report adjusted earnings of $3.75 a share. In July, UnitedHealth raised its per-share earnings targets to between $13.95 and $14.15 from between $13.80 and $14.05. The company will hold its investor call at 8:45 a.m.
REVENUE FORECAST: Analysts polled by FactSet expect sales of $59.76 billion, compared with $56.56 billion in the year-ago period.
MEDICAL COST RATIO: The ratio, which is a comparison of an insurer’s costs to its revenues, is expected to be 82.4% during the quarter, according to analysts polled by FactSet. A higher ratio indicates the company is putting less toward non-medical costs such as profits and reinvestment.
WHAT TO WATCH:
MEDICARE: The company earlier this month introduced its 2020 Medicare Advantage and prescription drug plans, and said almost 2 million people would pay zero dollars on Medicare Advantage premiums. Managed-care stocks tanked when Sen. Bernie Sanders (I., Vt.) in April introduced the Medicare for All Act. Sen. Elizabeth Warren (D, Mass.), a proponent of the bill, is among the frontrunners for the Democratic presidential nomination, according to the latest WSJ/NBC News Poll. “There’s been the medical overhang of the Medicare primary debate,” Evercore analyst Michael Newshel told WSJ.
HEALTH INSURER FEE: Health insurance companies in 2020 face a tax bill of more than $15.5 billion after the fee was suspended for 2019. “It’s the biggest headwind for next year,” Mr. Newshel said of the fee’s return.
COMPETITION: The company also faces more competition as Anthem strives to regain market share in the commercial group risk market, which Jefferies analyst David Windley, in a note earlier this month, said is gaining traction. Mr. Windley downgraded UnitedHealth’s rating to “hold” from “buy,” and lowered its price target to $235 from $300.
https://www.marketscreener.com/UNITEDHEALTH-GROUP-14750/news/UnitedHealth-Likely-to-Record-Higher-Sales-Earnings-Preview-29374320/
EARNINGS FORECAST: Analysts polled by FactSet expect profit of $3.55 a share. They expect UnitedHealth to report adjusted earnings of $3.75 a share. In July, UnitedHealth raised its per-share earnings targets to between $13.95 and $14.15 from between $13.80 and $14.05. The company will hold its investor call at 8:45 a.m.
REVENUE FORECAST: Analysts polled by FactSet expect sales of $59.76 billion, compared with $56.56 billion in the year-ago period.
MEDICAL COST RATIO: The ratio, which is a comparison of an insurer’s costs to its revenues, is expected to be 82.4% during the quarter, according to analysts polled by FactSet. A higher ratio indicates the company is putting less toward non-medical costs such as profits and reinvestment.
WHAT TO WATCH:
MEDICARE: The company earlier this month introduced its 2020 Medicare Advantage and prescription drug plans, and said almost 2 million people would pay zero dollars on Medicare Advantage premiums. Managed-care stocks tanked when Sen. Bernie Sanders (I., Vt.) in April introduced the Medicare for All Act. Sen. Elizabeth Warren (D, Mass.), a proponent of the bill, is among the frontrunners for the Democratic presidential nomination, according to the latest WSJ/NBC News Poll. “There’s been the medical overhang of the Medicare primary debate,” Evercore analyst Michael Newshel told WSJ.
HEALTH INSURER FEE: Health insurance companies in 2020 face a tax bill of more than $15.5 billion after the fee was suspended for 2019. “It’s the biggest headwind for next year,” Mr. Newshel said of the fee’s return.
COMPETITION: The company also faces more competition as Anthem strives to regain market share in the commercial group risk market, which Jefferies analyst David Windley, in a note earlier this month, said is gaining traction. Mr. Windley downgraded UnitedHealth’s rating to “hold” from “buy,” and lowered its price target to $235 from $300.
https://www.marketscreener.com/UNITEDHEALTH-GROUP-14750/news/UnitedHealth-Likely-to-Record-Higher-Sales-Earnings-Preview-29374320/
In new headache, WeWork finds cancer-causing chemical in its phone booths
Cash-strapped WeWork, the office-sharing company that is trying to negotiate a financial lifeline, has a new problem that may prove costly. It has closed about 2,300 phone booths at some of its 223 sites in the United States and Canada after it says it discovered elevated levels of formaldehyde.
The company, which abandoned plans for an initial public offering
last month after investors questioned its mounting losses and the way it
was being run, said in an email to its tenants on Monday that the
chemical could pose a cancer-risk if there is long-term exposure.
After a tenant complained of odor and eye irritation, WeWork began testing and based on the results took 1,600 phone booths out of service, the company said in the email to tenants, which it calls members.
An additional 700 booths are closed while more testing is conducted, it said. All the phone booths closed were installed over the past several months, WeWork said.
“The safety and well-being of our members is our top priority and we are working to remedy this situation as quickly as possible,” WeWork said in a statement.
More costs are the last thing needed at the company, which some analysts say is fast running out of cash. WeWork declined to comment on the cost of testing and replacing the booths.
It is currently in talks for a multi-billion dollar rescue deal that could lead to its largest shareholder, Japan’s SoftBank Group Corp, taking control, two people familiar with the matter said. WeWork is also talking to JPMorgan Chase over a possible debt package, they said.
WeWork declined to identify the manufacturer of the phone booths.
“Long-term exposure to formaldehyde, such as that experienced by workers in jobs who experience high concentrations over many years, has been associated with certain types of cancers,” WeWork told tenants in the email.
In 1987, the U.S. Environmental Protection Agency classified formaldehyde as a probable human carcinogen under conditions of unusually high or prolonged exposure. Some studies since then suggested that formaldehyde exposure is associated with certain types of cancer, according to the National Cancer Institute.
A tenant, who did not wish to be identified, said she was worried about the risk of cancer as she had spent hundreds of hours inside phone booths at a San Francisco WeWork that has the problem.
Phone booths are popular in WeWork’s open-plan offices as they provide privacy and noise reduction, the tenant said.
After a tenant complained of odor and eye irritation, WeWork began testing and based on the results took 1,600 phone booths out of service, the company said in the email to tenants, which it calls members.
An additional 700 booths are closed while more testing is conducted, it said. All the phone booths closed were installed over the past several months, WeWork said.
“The safety and well-being of our members is our top priority and we are working to remedy this situation as quickly as possible,” WeWork said in a statement.
More costs are the last thing needed at the company, which some analysts say is fast running out of cash. WeWork declined to comment on the cost of testing and replacing the booths.
It is currently in talks for a multi-billion dollar rescue deal that could lead to its largest shareholder, Japan’s SoftBank Group Corp, taking control, two people familiar with the matter said. WeWork is also talking to JPMorgan Chase over a possible debt package, they said.
WeWork declined to identify the manufacturer of the phone booths.
“Long-term exposure to formaldehyde, such as that experienced by workers in jobs who experience high concentrations over many years, has been associated with certain types of cancers,” WeWork told tenants in the email.
In 1987, the U.S. Environmental Protection Agency classified formaldehyde as a probable human carcinogen under conditions of unusually high or prolonged exposure. Some studies since then suggested that formaldehyde exposure is associated with certain types of cancer, according to the National Cancer Institute.
A tenant, who did not wish to be identified, said she was worried about the risk of cancer as she had spent hundreds of hours inside phone booths at a San Francisco WeWork that has the problem.
Phone booths are popular in WeWork’s open-plan offices as they provide privacy and noise reduction, the tenant said.
https://www.marketscreener.com/news/In-new-headache-WeWork-says-it-found-cancer-causing-chemical-in-its-phone-booths–29374615/?countview=0
Adverum and Regenxbio go opposite ways on macular degeneration data
Gene therapy developers REGENXBIO (RGNX -11%) and Adverum Biotechnologies (ADVM +17.4%)
have diverged after data presentations on their respective gene therapy
candidates for wet age-related macular degeneration (wet AMD) at the
American Academy of Ophthalmology Annual Meeting in San Francisco.
Additional results from the first cohort (median follow-up of 34 weeks) in the Phase 1 OPTIC study
showed that treatment-experienced patients (n=6) previously requiring
frequent anti-VEGF injections to maintain vision did not require any
rescue injections after receiving a single administration of ADVM-022
while maintaining stable visual acuity.
Preliminary results from cohort 5 in a Phase 1/2a study
of RGX-314 showed that 75% (n=9/12) of patients were anti-VEGF
injection-free at months 5 or 6 while the remaining subjects still
required injections. Across all 12 patients, the mean annualized
anti-VEGF injection rate was 0.8, implying that three patients required
an annualized average of more than three injections [(0.8 x 12)/3=3.2].
In cohort 4, 42% (n=5/12) were anti-VEGF injection-free at month 6 with
an average of 2.2 injections over that time period, implying that seven
patients received an average of almost four injections over six months
[(2.2 x 12)/7=3.8].
Regeneron Pharmaceuticals (REGN +2.5%), maker of top wet AMD seller Eylea (aflibercept), an anti-VEGF therapy, is up on average volume.
https://seekingalpha.com/news/3505590-adverum-regenxbio-go-opposite-ways-wet-amd-dataJohnson & Johnson Q3 2019 Earnings Preview
Johnson & Johnson (NYSE:JNJ) is scheduled to announce Q3 earnings results on Tuesday, October 15th, before market open.
The consensus EPS Estimate is $2.01 (-2.0% Y/Y) and the consensus Revenue Estimate is $20.16B (-0.9% Y/Y).
Over the last 2 years, JNJ has beaten EPS estimates 100% of the time and has beaten revenue estimates 100% of the time.
Over the last 3 months, EPS estimates have seen 1 upward revision and 15 downward. Revenue estimates have seen 8 upward revisions and 3 downward.
https://seekingalpha.com/news/3505582-johnson-and-johnson-q3-2019-earnings-previewSleep apnea linked to blinding eye disease in people with diabetes
New research from Taiwan shows that severe sleep apnea is a risk
factor for developing diabetic macular edema, a complication of diabetes
that can cause vision loss or blindness. Diabetic macular edema was
also more difficult to treat in patients with severe sleep apnea. While
earlier research showed a weak connection between the two conditions,
evidence is mounting that sleep apnea exacerbates underlying eye
disease. The researchers present their study today at AAO 2019, the
123rd Annual Meeting of the American Academy of Ophthalmology.
When people with diabetes have poor control over their blood sugar levels, the tiny blood vessels at the back of the eye can become damaged. This condition is called diabetic retinopathy and it’s a leading cause of blindness in the United States.
Sometimes, tiny bulges protrude from the blood vessels, leaking fluid and blood into the retina. This fluid can cause swelling or edema in an area of the retina that allows us to see clearly.
Sleep apnea is a sleep disorder in which breathing repeatedly stops and starts, disrupting sleep and causing blood oxygen levels to drop. This drop in oxygen appears to unleash a host of changes in the body that may play a role in injuring blood vessels. People with sleep apnea are at risk of developing hypertension, heart attacks, stroke and type 2 diabetes.
But what about the eyes? Researchers believe that sleep apnea may contribute to the development and worsening of diabetic retinopathy by increasing insulin resistance, elevating inflammation and raising blood pressure, all of which can damage the blood vessels at the back of the eye.
To learn more, lead researcher Juifan Chiang, MD, and colleagues looked at data from all patients diagnosed with diabetic retinopathy over an 8-year period at Chang Gung Memorial Hospital in Taiwan. They found that the rate of severe sleep apnea was significantly higher in patients with diabetic macular edema compared with those without diabetic macular edema (80.6 percent vs. 45.5 percent). They also found that the worse their sleep apnea was, the worse their macular edema. Severe sleep apnea was also more prevalent in patients who needed more treatment to control their macular edema. These patients required three or more treatments of medical or laser therapy.
“Based on these results, we hope that more medical professionals will approach sleep apnea as a risk factor for diabetic macular edema,” Dr. Chiang said. “This could allow for earlier medical intervention so patients can keep more of their vision and preserve their overall health as much as possible.”
https://www.eurekalert.org/pub_releases/2019-10/aaoo-sal100919.php
When people with diabetes have poor control over their blood sugar levels, the tiny blood vessels at the back of the eye can become damaged. This condition is called diabetic retinopathy and it’s a leading cause of blindness in the United States.
Sometimes, tiny bulges protrude from the blood vessels, leaking fluid and blood into the retina. This fluid can cause swelling or edema in an area of the retina that allows us to see clearly.
Sleep apnea is a sleep disorder in which breathing repeatedly stops and starts, disrupting sleep and causing blood oxygen levels to drop. This drop in oxygen appears to unleash a host of changes in the body that may play a role in injuring blood vessels. People with sleep apnea are at risk of developing hypertension, heart attacks, stroke and type 2 diabetes.
But what about the eyes? Researchers believe that sleep apnea may contribute to the development and worsening of diabetic retinopathy by increasing insulin resistance, elevating inflammation and raising blood pressure, all of which can damage the blood vessels at the back of the eye.
To learn more, lead researcher Juifan Chiang, MD, and colleagues looked at data from all patients diagnosed with diabetic retinopathy over an 8-year period at Chang Gung Memorial Hospital in Taiwan. They found that the rate of severe sleep apnea was significantly higher in patients with diabetic macular edema compared with those without diabetic macular edema (80.6 percent vs. 45.5 percent). They also found that the worse their sleep apnea was, the worse their macular edema. Severe sleep apnea was also more prevalent in patients who needed more treatment to control their macular edema. These patients required three or more treatments of medical or laser therapy.
“Based on these results, we hope that more medical professionals will approach sleep apnea as a risk factor for diabetic macular edema,” Dr. Chiang said. “This could allow for earlier medical intervention so patients can keep more of their vision and preserve their overall health as much as possible.”
https://www.eurekalert.org/pub_releases/2019-10/aaoo-sal100919.php
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