Healthcare Equity Analyst - Emerging & Dev Markets, daaimon

Avien Pillay

Healthcare Equity Analyst - Emerging & Dev Markets

daaimon

daaimon is an independent research company focusing on healthcare and consumer sectors across developed and emerging markets. We produce insightful research which challenges conventional thinking. In particular, we look for new ideas by testing consensus forecasts and markets expectations.

Thematic (Sector/Industry)

<ul>
<li>China's over-65 demographic is projected to grow by 50% in the next decade, driving increased demand for healthcare services, eldercare, and technology.</li>
<li>The healthcare sector in China presents a significant investment opportunity as the country addresses the needs of its ageing population.</li>
<li>Insights from the US, where healthcare spending is closely tied to an ageing population, can inform strategies for growth in China’s healthcare market, offering potential for long-term returns.</li>
</ul>


China's over-65 demographic is projected to grow by 50% in the next decade, driving increased demand for healthcare services, eldercare, and technology.
The healthcare sector in China presents a significant investment opportunity as the country addresses the needs of its ageing population.
Insights from the US, where healthcare spending is closely tied to an ageing population, can inform strategies for growth in China’s healthcare market, offering potential for long-term returns.


China's Ageing Population Challenge: Lessons from US Healthcare Spending

Equity Bottom-Up

Daiichi Sankyo Co, Ltd is a holding company established through merger of Sankyo and Daiichi pharmaceutical. The Group manufactures pharmaceuticals for human/veterinary use and medical tools and equipment. It also researches and promotes products through related companies throughout the world. The Group also produces food, food additives, livestock feeds, and agrochemicals.

<ul>
<li>At a 51 NPE, Daiichi Sankyo was priced for perfection.</li>
<li>We do like their focus on the high growth oncology segment, however, we felt that the valuation left no room for error.</li>
<li>Post the two disappointing trial announcements, at a 39 NPE, the valuation is become more palatable and getting closer to our mid-thirties target entry point.</li>
</ul>


At a 51 NPE, Daiichi Sankyo was priced for perfection.
We do like their focus on the high growth oncology segment, however, we felt that the valuation left no room for error.
Post the two disappointing trial announcements, at a 39 NPE, the valuation is become more palatable and getting closer to our mid-thirties target entry point.


Daiichi Sankyo (4568 JP) Valuation Update – Are We There Yet?

Celltrion Inc. produces and sells biosimilar products and also provides consignm ent processing service for other companies.  The Company's main product is Abata cept which is for arthritis treatment

<ul>
<li>The biosimilar market is forecast to grow three to four times faster than the generic drug market over the next five years.</li>
<li>However, we believe that this high growth will not necessarily imply good profitability, given the early stage of the biosimilar market, complications and competition.</li>
<li>We also believe that the company’s guidance is too optimistic resulting in an expensive multiple. We prefer some room for error.  </li>
</ul>


The biosimilar market is forecast to grow three to four times faster than the generic drug market over the next five years.
However, we believe that this high growth will not necessarily imply good profitability, given the early stage of the biosimilar market, complications and competition.
We also believe that the company’s guidance is too optimistic resulting in an expensive multiple. We prefer some room for error.  


Celltrion Inc (068270 KS)– Is the Sell-Side’s Bullishness Justified?

Innovent Biologics Inc / Equity Bottom-Up

Innovent Biologics, Inc. operates as a biopharmaceutical company. The Company develops, manufactures, and distributes monoclonal antibody drug candidates for the treatment of oncology, ophthalmology, autoimmune, cardiovascular, and other diseases. Innovent Biologics serves customers in China.

<ul>
<li>Dupert, a drug for the special treatment of non-small cell cancer has been approved by the NMPA.</li>
<li>In 2022, China recorded the highest number of new cancer cases, and their exceptional high incidence of smoking is of particular concern.</li>
<li>Innovent’s portfolio of nine oncology drugs is very attractive in the biggest cancer market.</li>
</ul>


Dupert, a drug for the special treatment of non-small cell cancer has been approved by the NMPA.
In 2022, China recorded the highest number of new cancer cases, and their exceptional high incidence of smoking is of particular concern.
Innovent’s portfolio of nine oncology drugs is very attractive in the biggest cancer market.


Innovent Biologics (1801 HK) Adds to Its Oncology Portfolio

<ul>
<li>The GLP-1 market is evolving at a rapid pace, and we have quickly moved onto the development of a triple agonist drug.</li>
<li>First mover advantage is expected to lose steam as more effective GLP-1s are launched.</li>
<li>Scary side effects; challenged patents and strong competition will favour the cost-effective producers.</li>
</ul>


The GLP-1 market is evolving at a rapid pace, and we have quickly moved onto the development of a triple agonist drug.
First mover advantage is expected to lose steam as more effective GLP-1s are launched.
Scary side effects; challenged patents and strong competition will favour the cost-effective producers.


A multi-skilled investment professional with 20+ years’ experience in the developed and emerging markets across all sectors, and a strong focus on healthcare. Most of my time has been spent as a buyside and independent equity analyst. My approach is a combination of bottom-up and top-down analysis, with a strong bias to qualitative analysis.