Introduction
We are excited to release the second issue of our monthly newsletter Sector Spotlight
This is a comprehensive newsletter coupled with decks for the current or aspiring investment banker/PE investor, diving deep into the qualitative and quantitative nature of transactions, businesses, and trends across sectors, from the POV of an investment banker/PE investor. The groups are led by incoming investment banking summer analysts & analysts across a range of bulge bracket, elite boutique, and middle market banks.
Unlike other finance newsletters, this will not just simply mention or briefly summarize deals and news but will link to decks that include in depth analysis on a given topic. As this is the first issuance, we’ll be covering three sectors: 1.) Media & Entertainment, 2.) , and 3.) Healthcare. We hope you enjoy this month’s edition and look forward to bringing you monthly updates moving forward. Enjoy!
Best,
Jagger Lambert lambertjagger@gmail.com
James Concepcion jamesconcepcion217@gmail.com
Healthcare
October 2023 Trends & Deals: See deck above for a deep dive into these topics and more!
- October has seen no shortage of clinical trials across all drugs. Notable drugs Tepezza and Krystexxa, which are the only curatives for their respective diseases and who were at the center of the Amgen/Horizon Therapeutics debacle recently entered Phase 4 trials, which is a post-approval stage that monitors the impact of the medicines
- Weight-loss drugs have also picked up in popularity in recent months, as more consumers have gotten access to drugs and the FDA has kept up their pace of drug approval.
- Eli Lily’s Mounjaro was approved at the tail end of September.
- The obesity market is posed to grow about 5x to $77bn by 2030, which is largely dominated by North America, which faces a uniquely bad obesity epidemic.
- Drugs like Ozempic and Wegovy, the leading weight-loss drugs, have consistently show applications in other areas. Ozempic, for example, has, in recent months, shown that it has potential applications at treating additions generally. Wegovy, not to be outdone, has recently shown applications in ameliorating kidney disease.
- The FTC’s Antitrust Division has been increasingly litigious across sectors, but especially within the healthcare space.
- Examples of companies in recent months impacted by FTC probes include Bristol Myers Squibb/Celgene, Pfizer/Seagen, Danaher/GE Biopharma, and Amgen/Horizon Therapeutics
- Novartis and Sandoz recently completed their spin-off, with Sandoz trading publicly on October 4th. The spinoff was announced in H2 2022.
- The decision to spin-off Sandoz was made after the unit had declining revenues in recent years.
- Novartis also wanted to focus more on their innovative medicines since and separate out their generics and biosimilars divisions.
- Labor tensions in the healthcare services industry have boiled over, resulting in strikes across the country as nurses demand greater compensation to match increasing levels of burnout
- This has sent ripple effects throughout the healthcare services industry
- Amgen and Horizon recently completed their merger, which was Amgen’s largest at $27.6bn in enterprise value.
- The FTC sued Amgen to block the merger in May 2023 over concerns that Amgen would use their position as an influential company to not only raise barriers for competition to Tepezza and Krystexxa (Horizon’s star medicines) but also to use those drugs to strong-arm pharmacy benefit managers into preferring Amgen’s products in a process called bundling.
- The deal was eventually resolved on the condition that Amgen would not bundle its products with Tepezza and Krystexxa.
