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Motive & Opportunity: The Convoluted Tale of Generic Price Inflation

Since early 2013, prices for generics sold in the US at retail have risen more than 40% on a sales weighted basis Three-quarters of this inflation was driven by straightforward median reversion: a host of products with very low prices

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Why ABBV is Still a Value

GILD’s disclosure of an expected 46% average Harvoni discount for 2015 reduces our net pricing expectations for ABBV’s Viekira Pak to roughly $42,000 per regimen, down from roughly $60,000 Despite this, we still see ABBV as a value, simply because

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Advertising: The “Golden Age” of TV Enters its Golden Years

US TV advertising has crested and is beginning its inevitable decline. In an era of rising transmission fees and a vigorous market for content licensing, media companies have been reporting disappointing revenues for their TV network units – the result

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DuPont – Trian Engages the Big Gun!

DuPont – Trian Engages the BIG Gun! Trian, today, announced the formation of Trian Advisory Partners, charged with the following: “Trian Advisory Partners will provide support to Trian by identifying potential investment opportunities, assisting with due diligence, formulating strategic and operating

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MCD – The Journey of 1,000 Miles Begins with a Single Step

McDonald’s (MCD) has had a difficult two (plus) year period, and the CEO during that period (Don Thompson) will not be part of any potential recovery as he was replaced last night by the company’s Chief Brand Officer, Steve Easterbrook. 

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The Bull Case for SNY’s Diabetes Franchise – Update

Consensus expectations for SNY’s basal insulins (Lantus/Toujeo) appear too low. Expectations fell 28% after SNY warned last October that US pricing had weakened, and have fallen to the point that consensus now expects 2017 sales to be lower than 2014

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The Outlook for Brand Drug Pricing Part 1: The Traditional Large-Cap Pharmaco’s

US net pricing gains explain more than 100 percent of US revenue growth for the large-caps as a whole; making net price growth crucial not only to future growth but also to dividends, a signal feature of valuations Net pricing

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Ten Investible Things That We Think Will Happen in 2015

2014 was a relatively quiet year in TMT, with the BABA IPO and the iPhone6 arguably the biggest events for investors. Our 2014 new year’s predictions were more on target than not, with calls for Samsung’s smartphone woes, IP litigation

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Flu Effects on 4Q14 Earnings

The 2014 – ’15 flu season is slightly worse than 2013 – ’14 overall; we estimate flu-related hospital spending will be up roughly 30% Notably, most of the additional hospitalizations are occurring among the elderly (65+), in fact hospitalization rates

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R&D:Sales Ratios Will Fall, Meaning AZN & LLY are Cheap, Research Tools & Services are Expensive

Returns to R&D spending are below costs of capital and deteriorating further; despite this the average large pharmaceutical company has increased R&D:sales ratios over the last decade. This implies that managements have faced little if any pressure to return cash

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