Health Care Archives | Page 81 of 137 | Smartkarma

• Medtronic Plc (MDT US) announced better-than-expected Q1FY24 result. Revenue of $7.7B increased 6% on organic basis, ahead of guidance of 4.5%. Each of four segments delivered 6% organic revenue growth.
• Adjusted EPS increased 6% YoY to $1.20, ahead of guidance of $1.10–1.12. Outperformance was driven by better-than-expected operational performance and lesser-than-expected unfavorable impact from foreign currency translation.
• The company increased FY24 organic revenue growth guidance to 4.5% versus the prior range of 4.0% to 4.5% and adjusted EPS guidance to $5.08–5.16, 7 cent increase at midpoint.

• The data in this insight is collated from the “shareholding disclosure” link on the HKEx website.
• Often there is a corresponding HKEx announcement on the increase – or decrease – in the shareholding by directors. Or pledging. However, such disclosures are by no means an absolute.
• The key stocks mentioned in this regular insight are WuXi AppTec (2359 HK), Peking University Resources (618 HK), and FriendTimes Inc (6820 HK).

• Medipal Holdings (7459 JP) announced strong Q1FY24 result, with a 6% YoY revenue growth to ¥887B, driven by growth across all three business segments.
• However, operating profit declined 8% YoY to ¥12B, mainly due to increase in SG&A expenses. Driven by an extraordinary income of ¥3.3B, net profit jumped 35% YoY to ¥11B.
• The company has reaffirmed FY24 guidance, which calls for a 4.5% YoY revenue growth, flat operating profit, and a 9.3% YoY decline in net profit.

• Sumitomo Pharma (4506 JP) recorded 53% YoY and 21% QoQ decline in Q1FY24 revenue to ¥75.7B, mainly due to the impact of the loss of exclusivity for Latuda in U.S.  
• Sumitomo’s schizophrenia drug candidate ulotaront missed primary endpoints in phase 3 trial. Clinical setback on one of the two phase 3 drug candidates is quite a blow for the company.
• Sumitomo reaffirmed FY24 guidance, which calls for revenue decline of 35% YoY to ¥362B. The company guided for adjusted operating loss of ¥62B and net loss of ¥80B in FY24.

• Sinopharm’s performance growth in 23H1 was satisfactory, but both gross profit margin and net profit margin decreased, which was mainly related to generic drugs VBP and medical device centralized procurement.
• Profitability could continue to be under pressure in the short term. In the long term, Sinopharm’s business transformation and new value-added businesses are expected to help improve profit margin performance.
• Due to the low base last year, we think Sinopharm Group Co Ltd H (1099 HK) would achieve double-digit growth in 2023. We’re optimistic about its stock price performance accordingly.

• We summarise the latest spreads and newsflow of merger arb situations we cover across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
• Highest spreads – Seiko Pmc Corp (4963 JP), 111 Inc (YI US), Costa Group Holdings (CGC AU), Symbio Holdings (SYM AU), Eoflow (294090 KS), Orecorp Ltd (ORR AU).
• Lowest spreads – Healius (HLS AU), Toyo Construction (1890 JP), Pacific Current (PAC AU), T&K Toka Co Ltd (4636 JP), Allkem Ltd (AKE AU), Celltrion Healthcare (091990 KS).

• Over two-thirds of the way through the review period, we see 14 potential changes for the KOSDAQ 150 Index (KOSDQ150 INDEX) at the December rebalance.
• There could be index changes even before the December rebalance if there are delistings and stocks migrate from the KOSDAQ Market to the KOSPI Market.
• Momentum in Korea has been strong. The potential adds have outperformed the potential deletes over the last few months and there could be further outperformance.

• Mavacamten is expected to be LianBio’s first commercialized product. Due to low diagnostic rate/doctors’ insufficient cognition of HCM, whether it can become a blockbuster drug in China is still uncertain.
• There’s an “insurmountable obstacle” to license-in model, and its “fault-tolerant space” is small. LianBio has to go all the way to the end.Otherwise, the license-in projects will eventually become worthless.
• Due to high cost rate, it’s difficult for LianBio to make profit even with large drug sales. Although pipeline is good, LianBio could still fail to bring investors good returns.

• Aier’s revenue would be up 20%+ YoY in 2023, but one risk is the slowing growth rate of refractive/other consumption upgrading projects in the context of sluggish consumption in 23H2.
• The positive impact of aging on performance would not be able to hedge against the negative impact of declining birth rate, ultimately leading to a decline in overall performance growth.
• When Aier’s external expansion model fails and endogenous growth is lower-than-expectation, we suggest that Aier increase dividends/stock buybacks instead of ineffective expansion. This would make Aier more attractive to investors.

• IPO rules in SSE STAR Market faces adjustments, so investors have lowered expectations, which will affect the fundraising ecology. Recovery of China’s financing environment would be slower than US/Europe.
• The CSRC has issued new policies related to stamp duty, IPO, and reduction of shares held by listed companies, which would significantly affect the capitalization path of pharmaceutical companies.
• Junshi is “an interesting Biotech” that once generated sales/profits in scale, but is losing money again.Since Junshi is outside the first echelon and the gap is widening, we remain conservative. 

• LianBio (LIAN US)‘s new drug application for its lead asset mavacamten is under priority review in China for the treatment of symptomatic obstructive hypertrophic cardiomyopathy, with approval expected in mid-2024.  
• The company is expected to start commercialize mavacamten in Singapore and Macau this year. As of June 30, 2023, LianBio has cash balance of $267M, with runway into H1 2025.
• LianBio is currently conducting phase 3 trial to evaluate the efficacy and safety of TP-03 in Chinese adult patients with Demodex blepharitis. Topline data is expected in 4Q23.

• For the month of August 2023, 11 new deals (firm and non-binding) were discussed on Smartkarma with an overall announced deal size of ~US$29bn.
• The average premium for the new deals announced (or first discussed) in August was 25%. The average YTD is 34%.
• This compares to the average premium for all deals in 2022 (106 deals), 2021 (165 deals), 2020 (158 deals), and 2019 (145 deals) of 41%, 33%, 31%, and 31% respectively.

“The brain is a complex organ, and also the least understood,” Pang Sze Yunn, co-founder and CEO of Singapore-based healthtech platform Neurowyzr, told Tech in Asia. 

According to Pang, early brain decline can take between 20 and 40 years before obvious conditions such as dementia, mental health diseases, or stroke occur.

“By then, therapies have little impact,” she added. “Traditional brain tests are inefficient, expensive and inaccessible.”

• IDEXX Laboratories surpassed Wall Street’s revenue and earnings expectations, showcasing strong growth and financial performance.
• The company achieved a 10% organic increase in overall revenues, driven by remarkable growth in CAG Diagnostics’ recurring payments.
• IDEXX’s solid performance was particularly evident in the significant placements of premium instruments, sustained new business gains, and strong growth in recurring veterinary software revenues.

• Illumina managed to surpass the revenue expectations as well as the earnings expectations of Wall Street.
• Illumina exceeded its expectations, with approximately $1.18 billion in revenue and diluted non-GAAP EPS of $0.32.
• In the quarter, the company sold 109 NovaSeq X instruments, and their team plans to offer more than 390 instruments over the entire year.

• DTx industry is still in the early stages of development. The establishment of a matching operation/service system is a very difficult task. There is a long distance from mature commercialization. 
• BrainAurora’s sales scale is small because its products haven’t received widespread recognition from medical system in China. Internationalization is challenging because it requires cross-border transfer of personal or scientific data.
• BrainAurora’s business prospects is still unclear.As the attitude of capital market towards DTx has become more rational, investors have begun to doubt if this field could really bring good return.

• Novo Nordisk A/S had a disappointing quarter with below-par revenues and earnings just about on par with market expectations.
• In addition to investing in the medium- and long-term development of the obesity market, Novo Nordisk also established an appealing and aggressive pipeline.
• However, Novo Nordisk can still provide operating profit growth of 32% and first-half profits per share growth of 44%.

• Agilent Technologies delivered an all-around beat in the most recent quarterly result, with revenue of $1.67 billion, higher than the team had anticipated.
• The pharma market in China is down 30%, which is the main reason for their overall pharma business decline.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

• Boryung Pharmaceutical (003850 KS) reported strong 2Q23 result, with revenue increasing 19% YoY to a record high of KRW216 billion, driven by 24% YoY growth in prescription drugs.
• H1 2023 revenue and net profit progressed 52% and 62% of the annual target, respectively, marking the fastest semi-annual lap ever to annual target.
• Boryung has reiterated guidance for 2023 revenue and operating profit of KRW810 billion and KRW61 billion, representing growth of 12% and 1%, YoY, respectively.

• IQVIA Holdings delivered a strong result and managed an all-around beat last quarter.
• The company continues to thrive within a healthy demand environment for the industry, underpinning its optimistic long-term outlook.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

AFT Pharmaceuticals has reported that the Auckland High Court has cleared it of the contractual breach claim filed by PBL Solutions in April 2020, which maintained that the opportunity for Pascomer (a topical formulation of rapamycin) was not under the scope of AFT Orphan Pharmaceuticals’ (AFTO’s) business in its legal case. While the ruling dismissed PBL’s claim for a lump sum payment for the assessed present value of Pascomer’s potential, the legal authority has directed AFT to share 35% of the potential (future) profits, which may arise in orphan indications in as well as outside Asia-Pacific. We note that AFT is pursuing Pascomer in non-orphan indications such as port-wine stains and is in the very early stages of development, hence the ruling does not have a near- to medium-term impact on AFT. Our valuation at NZ$644m, or NZ$6.14 per share, and estimates for AFT are unchanged.

• Malo Medical Management (MMM HK) (MMM) is looking to raise around US$100m (estimated) in its upcoming Hong Kong IPO. The deal will be run by Haitong.
• MMM is a dental service provider in China. It ranked ninth among all private dental service providers and second among all premium dental service providers, as per F&S.
• MMM provides dental services to patients through a widespread network of Malo Clinic-branded specialty dental clinics. As of Apr 2023, it owned 29 dental clinics in 13 cities in China.

Leveraging the expanded scope of operations from its recent acquisition of Access Managed Services (AMS), Respiri has announced the signing of new remote patient monitoring (RPM) contracts with VDO Cardiology and Angelic Health Partners, along with an extended contract with Minnesota Lung Center (existing client) for a sponsored remote therapeutic monitoring (RTM) pilot study in patients with obstructive sleep apnea (OSA). These contracts will add a total of 600 patients to Respiri’s customer base, with a potential A$900k in annual revenues. The new contracts bode well for the company’s break even target of 9,000 patients by H2 CY24 and re-emphasise the contribution of the AMS deal in achieving this. They also broaden Respiri’s addressable RPM market beyond respiratory to cardiovascular, diabetes, asthma, obesity and sleep apnea-related treatments. As advanced discussions are underway with other healthcare organisations and payors according to management, we see incremental revenue expansion opportunities in the near term. We plan to revisit our assumptions post the AMS acquisition; therefore, we have placed our estimates and valuation under review.

• The September rebalance of the HSI, HSCEI and HSTECH indices will use today’s closing prices to cap the index constituent weights at 8%. This will lead to large flows.
• The largest passive inflows will be on East Buy (1797 HK), JD.com (9618 HK), Ping An (2318 HK), Sinopharm (1099 HK), BYD (1211 HK), Lenovo (992 HK) and Trip.com (9961).
• The largest passive outflows will be on Alibaba (9988 HK), Li Auto (2015 HK), Meituan (3690 HK), AAC Technologies (2018 HK), Kuaishou (1024 HK), COGARD (2007) and CG Services (6098).

• PolyNovo Ltd (PNV AU) reported record high sales of A$66.5M, up 59% YoY during FY23, mainly driven by strong momentum in the U.S. RoW sales increased 134% YoY to A$14M.
• However, net underlying loss widened to A$2.3M in FY23 from A$2.0M in FY22 due to a 50% YoY increase in operating expenses due to increasing headcount and R&D investment.
• In FY23, the U.S. customer accounts increased to 299 hospitals from 189 hospitals in FY22. PolyNovo continued geography expansion and entered Hong Kong, India, and Canada markets.

• IHH Healthcare (IHH MK) will acquire remaining stake in Indian hospital chain operator Ravindranath GE Medical Associates for RM415M. The transaction is expected to close by 4Q23.
• IHH is acquiring Bedrock Healthcare for RM245M. Bedrock operates 82-bed hospital in the Malaysian state of Sarawak and has earmarked a vacant land for the construction of a 200-bed hospital.
• In 1Q23, IHH reported highest ever quarterly revenue of RM5.1B, representing 24% YoY growth on higher patient volume across key markets. Net income nearly triples to RM1.4B.

• Merck delivered an all-around beat in the quarter, making excellent strides in advancing compelling science that will contribute to meeting the world’s most critical unmet medical needs.
• Concerning their research organization, Merck’s encouraging late-stage pipeline keeps proving beneficial for patients with a wide spectrum of ailments.
• In oncology, Merck highlighted information from ASCO’s extensive pipeline, including evidence for KEYTRUDA in lung cancer that is in an earlier stage.

• In 23H1, Tigermed’s net profit attributable to shareholders has changed from a negative growth trend in 2022. However, net profit growth brought by its main CRO business was not impressive.
• With the reform of domestic new drug approval policies, domestic CRO demand would decrease. Since Tigermed mainly provides early-stage CRO services, it’s more susceptible to negative changes of financing environment.
• Tigermed’s performance growth would slow down in 2023. Although valuation is in the bottom range, we recommend investors to take profits in time for any rebound in the stock price.

• We summarise the latest spreads and newsflow of merger arb situations we cover across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
• Highest spreads – 111 Inc (YI US), Costa Group Holdings (CGC AU), Eoflow (294090 KS), ENM Holdings (128 HK), Symbio Holdings (SYM AU), Mason Group Holdings (273 HK), JSR.
• Lowest spreads – Healius (HLS AU), Toyo Construction (1890 JP), Celltrion Healthcare (091990 KS), T&K Toka Co Ltd (4636 JP), Yaizu Suisankagaku Industry (2812 JP), Sanei Architecture Planning (3228 JP). 

• The market is clearly satisfied with WuXi Bio’s interim results. Growth of both non-COVID revenue and new projects were beyond expectations. This makes us look forward to 2023 full-year result.
• There’s a significant strength gap between WuXi Bio and Lonza/Samsung Biologics in undertaking commercial-stage orders, which puts WuXi Bio at a disadvantage in competition,making it more vulnerable to financing environment.
• It’s not impossible to restore the high growth before COVID,but WuXi Bio needs to meet two conditions.Instead of betting on a V-shaped reversal, it’s wiser to take profits in time.