We expect 3Q13 health services demand growth (y/y, nominal) of 3.5%, the product of 2.1% growth in unit demand and 1.4% growth in nominal pricing (Exhibit 1). Our nominal pricing…
Background State Medicaid programs use a variety of drug pricing benchmarks to determine how much a retail pharmacy is paid when a multi-source (generic, essentially) prescription is dispensed to a…
Premise and rationale behind the ‘Hidden Pipeline’ valuation method Share prices of drug and biotech stocks arguably can be broken down into two major components: the capital markets’ estimates of…
Background Product pipelines account for a large percentage of drug and biotech companies’ total values, however relatively little information about pipeline products is available through traditional sources. As a result,…
Background and Introduction Pharmaceuticals demand growth is the product of population growth, growth in units (e.g. prescriptions) per person, and growth in price per unit. Price per unit can be…
Summary and Investment Conclusion Capital markets can see the characteristics of, and thus place reasonable values on, drug products that are on-market, in registration, or in very late (phase III)…
We’ve long argued that PBM gross margins should decline[1] as a byproduct of several pressures, the most prominent being a shift away from the Average Wholesale Price (AWP) drug pricing…
Summary and Investment Conclusion Five separate lawsuits challenging the constitutionality of the individual coverage mandate in the Affordable Cart Act (ACA) have been heard in four federal appeals courts, so…
This note compares the two drug acquisition cost benchmarks (Average Manufacturer Price or AMP, and National Average Drug Acquisition Cost or NADAC) that CMS intends to make public. NADAC values…
Our bearish thesis on the drug trades generally and PBMs specifically has several moving parts; of these, the effect of the AWP[1]benchmark on generic dispensing margins is key The heart…