Perspectives Blog

Obamacare’s insurance exchanges

Columbia Management, Investment Team | December 9, 2013

…’ profits. Nonetheless, even with these ASO advantages, employers may simply decide simply no longer to manage health benefits. Healthcare exchanges hold great promise for the companies who offer and manage them. Nonetheless, competition among exchange providers will be stiff. Those companies that already have strong relationships with employers, such as large insurance brokers, are likely winners, as are the health insurers that can operate exch…

Predatory trading – Just how big an issue is high-speed trading?

Matt Waldner, Head of US Equity Trading | April 7, 2014

…– a non-profit entity run for the greater good. The 2000s were marked with much regulation, culminating with Regulation National Market System (Reg NMS) in 2007. In the 2007 version of Reg NMS, the regulators aimed to promote competition among exchanges and allow for greater ‘access’–  an effort to harmonize quotes across different exchanges and trading centers. In the years that followed, new exchanges, dark pools and alternate trading sys…

Predicting new drug sales is more art than science

Harlan Sonderling, CFA, Senior Healthcare Analyst | April 14, 2014

…overage, extensive counterfeiting and the launch of two competing drugs. Drugs that treat orphan (rare) diseases were initially thought of as limited commercial opportunities because of small patient population. However, with competition limited by the FDA to encourage innovation, some orphan drugs have been priced in multiple hundreds of thousands of dollars, leading to bonanzas for their developers. Sometimes drug companies simply fail to suppo…

Take an active approach to selecting your active manager

Robert McConnaughey, Director of Global Research | April 7, 2014

…ing against diversified U.S. domestic indices, the empirical evidence is pretty clear. Active managers have seen much greater success in a more normal cross-correlation environment while struggling to keep up with the passive competition in the historically high cross-correlation markets such as the one that resulted in the post-crisis years (Exhibit 1). We have already begun to see improving results from active managers as correlations have fall…

Specialty pharmaceuticals – The fastest growing category of healthcare spending

Harlan Sonderling, CFA, Senior Healthcare Analyst | January 27, 2014

…system (multiple sclerosis). A sub-sector within specialty that is growing even faster is “ultra orphan” drugs, those costing hundreds of thousands of dollars annually for chronic treatment and for which there is virtually no competition. Specialty growing in absolute dollars and percent of drug spend Payers are intensely focused on managing specialty pharmaceutical spending, their most rapidly growing medical cost. A Milliman study estimates th…

Finding the sweet spots in corporate spending

Robert McConnaughey, Director of Global Research | February 24, 2014

…sinesses still dragging their feet on reinvestment, hoping to squeeze higher profits out of an aging asset base (see Exhibit 2), the time may be ripe for wise tactical investment in innovation in order to steal a march on the competition. Exhibit 2 Source: Goldman Sachs Investment Research, February 2014 Again, we do not see a vast acceleration of capital spending on pent-up demand. CFO’s are still anxious to protect the margin gains they have m…