Healthcare equity analyst - emerging & dev mkts, daaimon

Avien Pillay

Healthcare equity analyst - emerging & dev mkts

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 healthcare spend has been growing faster than GDP, however it still lags a number of the other emerging markets especially in Latin America.</li>
<li>India’s healthcare spend is very concerning and has been stagnant/declining despite the high growth in GDP over the past few decades.</li>
<li>China and India need to drastically increase spend to address their critical healthcare issues or face a declining growth rate.</li>
</ul>


China’s healthcare spend has been growing faster than GDP, however it still lags a number of the other emerging markets especially in Latin America.
India’s healthcare spend is very concerning and has been stagnant/declining despite the high growth in GDP over the past few decades.
China and India need to drastically increase spend to address their critical healthcare issues or face a declining growth rate.


Asian Healthcare Spend as a Percentage of GDP – the Laggards

<ul>
<li>The cardiovascular disease (CVD) incidence and mortality gap between China and the West has narrowed/closed relatively quickly. CVD mortality rates in China exceeded Western levels a decade ago.</li>
<li>China scores poorly for a number of leading CVD causes including diet, tobacco consumption and air pollution.</li>
<li>Given the crisis situation, the Chinese authorities are left with no alternative but to drastically increase investment in healthcare and education.</li>
</ul>


The cardiovascular disease (CVD) incidence and mortality gap between China and the West has narrowed/closed relatively quickly. CVD mortality rates in China exceeded Western levels a decade ago.
China scores poorly for a number of leading CVD causes including diet, tobacco consumption and air pollution.
Given the crisis situation, the Chinese authorities are left with no alternative but to drastically increase investment in healthcare and education.


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>Cancer is the most common cause of death in Japan, and at 282.9 cases per 100 000 people, it ranks at the upper end of the global recorded range.</li>
<li>In 2020, Daiichi Sankyo embarked on transforming to a leading oncology specialist in terms of new drug development.</li>
<li>Daiichi Sankyo’s ADC pipeline comprises of six higher level drugs with a number of indications (sub-categories). This pipeline is part of a universe of 2499 oncology drugs in development.</li>
</ul>


Cancer is the most common cause of death in Japan, and at 282.9 cases per 100 000 people, it ranks at the upper end of the global recorded range.
In 2020, Daiichi Sankyo embarked on transforming to a leading oncology specialist in terms of new drug development.
Daiichi Sankyo’s ADC pipeline comprises of six higher level drugs with a number of indications (sub-categories). This pipeline is part of a universe of 2499 oncology drugs in development.


Daiichi Sankyo (4568 JP) – We like the Focus on Oncology but Look for a Better Entry Point

Novo Nordisk A/S develops, produces, and markets pharmaceutical products. The Company focuses on diabetes care and offers insulin delivery systems and other diabetes products. Novo Nordisk also works in areas such as haemostatis management, growth disorders, and hormone replacement therapy. The Company offers educational and training materials. Novo Nordisk markets worldwide.

<ul>
<li>FDA approval of Wegovy is overvalued at approx. $460 billion. Market exaggerated the worth without proper assessment of weight loss results and risks associated with the drug.</li>
<li>Clinical trials showed a 14.9% weight loss with diet and exercise; real-world results would be lower. Impact on BMI for obese individuals won't be significant. Long-term use is questionable.</li>
<li>Competition in the GLP-1 market is fierce. Novo Nordisk faces challenges in India and China, increased capex spending, and risks from compounding pharmacies and potential legal issues.</li>
</ul>


FDA approval of Wegovy is overvalued at approx. $460 billion. Market exaggerated the worth without proper assessment of weight loss results and risks associated with the drug.
Clinical trials showed a 14.9% weight loss with diet and exercise; real-world results would be lower. Impact on BMI for obese individuals won't be significant. Long-term use is questionable.
Competition in the GLP-1 market is fierce. Novo Nordisk faces challenges in India and China, increased capex spending, and risks from compounding pharmacies and potential legal issues.


Novo Nordisk: Is the FDA Approval of Wegovy Worth an Extra $460 Bn?

<ul>
<li>In 2022, there were 20 million new cancer cases, and almost half of the cases were recorded in Asia.</li>
<li>Global oncology spend is forecast to grow at 11.99% between 2023 and 2027, and this is expected to be almost three times faster than the growth of total pharma spend.</li>
<li>Emerging companies continue to make big strides in oncology drug development and made up 71% of the new drug pipeline in 2022.</li>
</ul>


In 2022, there were 20 million new cancer cases, and almost half of the cases were recorded in Asia.
Global oncology spend is forecast to grow at 11.99% between 2023 and 2027, and this is expected to be almost three times faster than the growth of total pharma spend.
Emerging companies continue to make big strides in oncology drug development and made up 71% of the new drug pipeline in 2022.


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.

Avien Pillay
Healthcare equity analyst - emerging & dev mkts
• daaimon

Asian Healthcare Spend as a Percentage of GDP – the Laggards

China and especially India’s spend on healthcare lags several emerging markets and needs to drastically increase to address their critical...

Avien Pillay

China’s Cardiovascular Disease Crisis

CVD incidence and mortality rates are at crisis levels. China scores poorly for a number of leading causes. The authorities are left with little...

Avien Pillay

Daiichi Sankyo (4568 JP) – We like the Focus on Oncology but Look for a Better Entry Point

Daiichi Sankyo has increased focus on high growth oncology and entered into a potentially very lucrative deal with Merck. We like the company, we...

Avien Pillay

Novo Nordisk: Is the FDA Approval of Wegovy Worth an Extra $460 Bn?

In light of the bullish Innovent report, and the ongoing news about new GLP-1s in the pipeline, this "Novo Nordisk - critical analysis" provides a...

Avien Pillay

Oncology Will Continue to Dominate

The oncology category has recorded the highest growth over the last five years. Companies with oncology portfolios and new oncology modalities,...

Avien Pillay