Daily Brief Health Care: Pacific Smiles, Indegene Limited, M3 Inc, Siloam International Hospitals, AFT Pharmaceuticals, Intuitive Surgical and more

• On the 18th December 2023, Pacific Smiles (PSQ AU), an operator of dental centers, announced and rejected a A$1.40/share non-binding proposal from Genesis Capital. Genesis subsequently increased its stake to 19.90%.
• Genesis then bumped its NBIO to A$1.75/share on the 19 March and was granted due diligence on a non-exclusive basis. PSQ said it would support the revised terms if firmed. 
• PSQ has now entered a Scheme with National Dental Care at A$1.90/share. The Offer also requires FIRB signing-off. But the proposal is a non-starter if Genesis rejects terms. 

• Indegene Limited (1864095D IN) has set IPO price band at INR430–452 per share. The IPO consists of fresh issue as well as OFS by existing shareholders.
• Considering FY24 annualized post-IPO EPS of INR13.48, Indegene seeks a P/E valuation of 31.9–33.5x.
• Considering niche business focus, proven execution capability, marquee clientele, long-standing client relationship, life science focus, and comprehensive offering, Indegene’s valuation seems quite attractive.

• M3 Inc (2413 JP) reported 4Q and Full-year FY03/2024 results. Earnings missed both guidance as well as consensus due to slowdown in Medical Platform and Overseas businesses.
• Medical Platform’s earnings declined further in 4Q with spending cuts by pharma companies, and it seems that the segment’s earnings will further decline going forward.
• M3’s share price is down 18% YTD, and we do not see many catalysts to drive a rally in the company’s share price.

• Siloam International Hospitals booked a solid set of 1Q2024 results, with sustained QoQ improvements in revenues, EBITDA, and profits, stripping out a one-off write-down for hospitals under development. 
• The company also saw strong improvements in operational metrics including inpatient and outpatient days, with especially strong performance in March due to a dengue epidemic, which also diluted patient intensity. 
• Siloam International Hospitals saw continuing strength in more complex treatments, as it focused on raising clinical acuity in areas such as transplants and cardiology. Valuations remain attractive relative to peers.

While AFT continues to gain commercial traction from Maxigesic/ Combogesic IV sales in the US (launched by partner Hikma in Q1 CY24) and anticipates the launch of Crystaderm in China, a strong R&D pipeline is central to AFT’s long-term growth ambitions. AFT recently announced the seventh addition to its R&D portfolio, a non-invasive topical alternative treatment for keloid and hypertrophic scarring, addressing the limited treatment algorithm for keloid scars (raised, thickened scars). This development collaboration is with Massey Ventures and the Gillies McIndoe Research Institute, and continues AFT’s initial collaboration with these parties from 2022, for the treatment of strawberry birthmarks.

• Intuitive Surgical delivered a healthy first quarter performance with strong procedure growth and solid capital placements.
• However, the company also faced some regional challenges during the quarter.
• Core measures of the company’s operations remained strong, as seen in its robust procedure growth and solid capital placements.