Tick-tock, tick-tock, tick-tock... just six-and-half more months until the Patient Protection and Affordable Care Act, also known as Obamacare, goes into full effect.
Over the past year we at The Motley Fool have examined the ins-and-outs of this bill from multiple angles, including how a cap on the medical loss ratio at 80% will ensure patients who need medical care are getting it, and that no patient can be turned away for preexisting conditions. However, we've also looked at the other side of the coin, which demonstrates there's a strong possibility that health insurers will maintain much of their pricing leverage that would most likely lead to continued premium hikes.
As I've said before, one of the few certainties about the PPACA is that uncertainties reign! Questions abound as to how it will affect the quality and price of care received, as well as impact the individual pocketbooks of consumers around the U.S. Perhaps no issue, though, is more pressing than how the bill will affect the middle-class American consumer.
Top 5 Medical Companies To Own For 2014: Cerus Corporation(CERS)
Cerus Corporation, a biomedical products company, engages in the development and commercialization of the INTERCEPT Blood System. The company?s INTERCEPT system is designed to inactivate blood-borne pathogens in donated blood components intended for transfusion. It markets the INTERCEPT system for platelets and plasma primarily in Europe, the Russian Federation, and the Middle East. The company is also developing INTERCEPT Blood System for red blood cells or red blood cell system, which is designed to inactivate blood-borne pathogens in donated red blood cells for transfusion. Cerus Corporation has collaboration agreements with Baxter International, Inc.; and BioOne Corporation, as well as the United States Armed Forces. The company was founded in 1991 and is based in Concord, California.
Advisors' Opinion:- [By Michael Shulman]
Cerus (NASDAQ: CERS) developed and markets the INTERCEPT Blood System, which is designed to inactivate blood-borne pathogens in blood components so the blood can be used in transfusions. In other words, it “cleans” donated blood of viruses, bacteria and parasites.
Cerus is pretty much the only game in town with this remarkable technology, and it has gained approval in most large European countries. Why not the United States? Well, management has not stood up to the FDA. The approval has been held up by one member of the FDA even though Cerus hit the primary endpoints in its pivotal Phase III trial and is receiving grants from the Department of Defense.
The FDA should quit dragging its feet eventually. There is no scientific or product risk in this stock. Their system works. My target price is $14 in one to three years.
Top 5 Medical Companies To Own For 2014: Bio-Reference Laboratories Inc.(BRLI)
Bio-Reference Laboratories, Inc. provides clinical laboratory testing services for the detection, diagnosis, evaluation, monitoring, and treatment of diseases primarily in the greater New York metropolitan area. It offers various chemical diagnostic tests, including blood and urine analysis, blood chemistry, hematology services, serology, radio-immuno analysis, toxicology, pap smears, tissue pathology, and other tissue analysis. The company also operates a clinical knowledge management service unit, which uses customer data from laboratory results, pharmaceutical data, claims data, and other data sources to provide administrative and clinical decision support systems. In addition, it operates a Web-based connectivity portal solution for laboratories and physicians to provide laboratory ordering and results to physician customers. The company provides its services directly to physicians, geneticists, hospitals, clinics, and correctional and other health facilities. Bio-Refe rence Laboratories, Inc. was founded in 1981 and is headquartered in Elmwood Park, New Jersey.
Advisors' Opinion:- [By Squeeze Ideas]
Medical Laboratories & Research Industry. Market cap of $621.05M. Short float at 24.02% (equivalent to 25.29 days of average volume).
Net Income grew by 19.5% ($8.58M vs. $7.18M y/y), while Operating Cash Flow grew by 21.38% ($9.88M vs. $8.14M y/y) (comparing 3 months ending 2010-10-31 vs. 3 months ending 2009-10-31).
The stock has a relatively low correlation to the market (beta = 0.71), which may be appealing to risk averse investors.
Other Highlights: Judging by trailing twelve month (TTM) ratios like Return on Equity (ROE), Return on Assets (ROA) and Return on Invested Capital (ROI), it's clear that the company's management is doing an excellent job. TTM ROE at 20.49%, higher than the industry average at 17.9%, TTM ROA at 12.68% vs. the industry average at 6.71%, and TTM ROI at 16.16%, higher than the industry average at 11.34%. The company also outperformed its industry competitors in terms of the TTM Return on Sales ratio (6.32% vs. the industry average at 4.52%).
Top Stocks To Invest In Right Now: Hanger Orthopedic Group Inc.(HGR)
Hanger Orthopedic Group, Inc. engages in the ownership and operation of orthotic and prosthetic (O&P) patient care centers in the United States. The company provides orthotic and prosthetic patient care services. Its orthotics business include the design, fabrication, fitting, and maintenance of a range of standard and custom-made braces and other devices that provide external support to patients suffering from musculoskeletal disorders, such as ailments of the back, extremities or joints, and injuries from sports or other activities. The company?s prosthetics business comprise designing, fabricating, fitting, and maintaining custom-made artificial limbs for patients, who are without limbs as a result of traumatic injuries, vascular diseases, diabetes, cancer, or congenital disorders. It also distributes branded and private label O&P devices, as well as develops programs to manage various aspects of O&P patient care for insurance companies. In addition, the company manufac tures and distributes therapeutic footwear for diabetic patients in the podiatric market, as well as develops and provides specialized rehabilitation technologies and integrated clinical programs to rehabilitation providers. As of June 30, 2011, it operated approximately 675 patient-care centers in 45 states and the District of Columbia. The company, formerly known as Sequel Corporation, was founded in 1861 and is headquartered in Austin, Texas.
Advisors' Opinion:- [By Newsy Stocks]
Hanger Orthopedic Group Inc. (NYSE: HGR) engages in the ownership and operation of orthotic and prosthetic (OP) patient care centers in the United States. The company has a total market capitalization of $601.8 million and in the last 1-year the stock has given a return of 34 percent. The company does not pay any dividend to its stockholders, and has a price of profit (POP) of 10. The stock is trading at a P/E of 20.92, higher than the industry’s average P/E of 14.15. The PEG ratio of the stock is 0.86 years, lower than industry’s PEG of 1 year. The average 5 years historical earnings growth is 25.60 percent and is expected to grow at 15 percent for the next 5 years. Its quarterly revenue growth is estimated at 17.12 percent. The stock has a P/B value of 1.54x percent. Analyst at Jefferies brokerage firm has given it a buy rating on $31.20 price target. Based on the price target the stock is trading at a discount of 42.44 percent. HGR was up 2.04 percent to $18.53 on Wednesday.
Top 5 Medical Companies To Own For 2014: Elan Corporation PLC (ELN)
Elan Corporation, plc (Elan), incorporated in December 1969, is a neuroscience-based biotechnology company. The Company is focused on discovering and developing advanced therapies in neurodegenerative and autoimmune diseases. Elan�� business focuses on neurodegenerative diseases, such as Alzheimer�� disease and Parkinson�� disease; autoimmune diseases, including MS and Crohn�� disease and neo-epitope based targets for treatments across a range of therapeutic indications. Tysabri is a treatment for MS and Crohn�� disease that the Company markets and distributes with Biogen Idec. On September 16, 2011, Elan sold its EDT business to Alkermes, Inc. In November 2011, Elan launched a collaboration with the University of Cambridge, England, the Cambridge-Elan Centre for Research Innovation and Drug Discovery (Cambridge-Elan Centre). On December 21, 2012, the Company completed the demerger of Prothena Corporation plc. In April 2013, it closed the TYSABRI (natalizumab) Collaboration Transaction with Biogen Idec.
Tysabri
Tysabri, which is an alpha-4 integrin inhibitor, is a therapy for MS, a neurological disorder involving central nervous system dysfunction among adults. Tysabri is approved in more than 65 countries. Tysabri is approved in the United States as a monotherapy for relapsing forms of MS, for patients who have had an inadequate response to, or are unable to tolerate, an alternative MS therapy. In the European Union, it is approved for relapsing-remitting MS (RRMS) in adult patients who have failed to respond to beta interferon or have rapidly evolving, severe RRMS. As of December 31, 2011, there were approximately 64,400 patients on Tysabri therapy worldwide.
In June 2011, the European Commission (EC) approved the inclusion of the anti-JCV antibody status as an additional factor in stratifying patients at risk for developing PML in the Summary of Product Characteristics��(SmPC) for Tysabri in the European Union. The Company has developed a two-step ! enzyme-linked immunosorbent assay (ELISA), STRATIFY JCV, with Biogen Idec. The assay detects anti-JCV antibodies in the blood of patients, and is commercially available in Europe. In January 2012, the FDA cleared the assay for commercial use in the United States. As of December 31, 2011, over 80,000 tests had been administered using the assay. Tysabri is marketed and distributed by Elan and Biogen Idec. The Company�� research group, Neotope, is focused on creating monoclonal antibodies based on neo-epitope targets for the treatment of a range of therapeutic indications.
Beta Amyloid Immunotherapies (AIP)
Beta amyloid immunotherapy includes the treatment of Alzheimer�� disease by inducing or enhancing the body�� immune response in order to clear toxic species of beta amyloid from the brain. The AIP includes bapineuzumab (intravenous and subcutaneous delivery) and ACC-001, as well as other compounds. Bapineuzumab is an experimental humanized monoclonal antibody delivered intravenously that is being studied as a treatment for mild to moderate Alzheimer�� disease. It is designed to provide antibodies to beta amyloid directly to the patient (passive immunotherapy).
ELND005, an A� Aggregation Inhibitor
The small molecule ELND005 (Scyllo-inositol) is a beta amyloid anti-aggregation agent. Preclinical data suggest that ELND005 may act through the mechanism of preventing and reversing the fibrilisation of beta amyloid (the aggregation of beta amyloid into clumps of insoluble oligomers). ELND005 may have additional applications in psychiatric indications, such as bipolar disorder. In November 2011, the Company entered into a manufacturing agreement for the supply of the active pharmaceutical ingredient for ELND005 with Lonza Group AG.
Neotope Biosciences Limited
Neotope Biosciences Limited (Neotope) is the Company�� wholly owned subsidiary that focuses on the discovery and development of antibodies to neo-epitope related targ! ets for t! he treatment of a range of indications. It includes amyloidosis, diabetes, cancer and macular degeneration. Neotope�� portfolio of targets includes alpha-synuclein for the potential treatment of synucleinopathies, such as Lewy body dementia and Parkinson�� disease, tau for Alzheimer�� disease and other tauopathies. It also has a program for type 2-diabetes.
Onclave Therapeutics Limited
Elan�� wholly owned subsidiary Onclave Therapeutics Limited (Onclave) was formed to develop assets originating from Elan that have application in oncology related diseases. Onclave�� program, NEOD001, which originated from Neotope, is being investigated for the treatment of AL amyloidosis, which is a fatal disease involving abnormal accumulation of amyloid in organs and tissue. During the year ended December 31, 2011, Onclave filed for orphan drug designation of NEOD001. Onclave�� pipeline includes additional compounds with relevance in diverse cancer indications.
The Company competes with Biogen Idec, Bayer Schering Pharma AG, Bayer Schering Pharma, Merck Serono, Pfizer, Teva Neurosciences, Inc., Sanofi-Aventis and Novartis AG.
Top 5 Medical Companies To Own For 2014: Organovo Holdings Inc (ONVO.PK)
Organovo Holdings, Inc. (Organovo), formerly Real Estate Restoration & Rental, Inc., incorporated in 2007, is a development-stage company. The Company has developed and is commercializing a platform technology for the generation of three-dimensional (3D) human tissues that can be employed in drug discovery and development, biological research, and as therapeutic implants for the treatment of damaged or degenerating tissues and organs. On December 28, 2011, Real Estate Restoration and Rental, Inc.�� (RERR) entered into an Agreement and Plan of Merger, pursuant to which RERR merged with its, wholly owned subsidiary, Organovo (Merger Sub). On February 8, 2012, the Company merged with and into Organovo Acquisition Corp. (Acquisition Corp.), a wholly owned subsidiary of Organovo, with the Company surviving the merger as a wholly owned subsidiary of Organovo Holdings (the Merger). As a result of the Merger, Organovo acquired the business of Organovo, Inc.
The C ompany has collaborative research agreements with Pfizer, Inc. (Pfizer) and United Therapeutic Corporation (Unither). As of March 31, 2012, it has five federal grants, including Small Business Innovation Research grants and developed the NovoGen MMX Bioprinter (its first-generation 3D bioprinter). The Company is engaged in the development of specific 3D human tissues to aid Pfizer in discovery of therapies in two areas of interest. In addition, in October 2011, it entered into a research agreement with Unither to establish and conduct a research program to discover treatments for pulmonary hypertension using its NovoGen MMX Bioprinter technology. Additionally, under the research agreement with Unither, the Company granted Unither an option to acquire from the Company a worldwide, royalty-bearing license in certain intellectual property created under the research agreement solely for use in the treatment or prevention of pulmonary hypertension and all other lung diseases.
The Company�� NovoGen MMX Bioprinter is an aut! om! ated device that enables the fabrication of three-dimensional (3D) living tissues comprised of mammalian cells. A custom graphic user interface (GUI) facilitates the 3D design and execution of scripts that direct precision movement of the dispensing heads to deposit cellular building blocks (bio-ink) or supporting hydrogel. The Company is using a third party manufacturer, Invetech Pty., of Melbourne, Australia, to manufacture its NovoGen MMX Bioprinter. Its bioprinting technology and surrounding intellectual property and commercial rights serve as a platform for product generation across multiple markets that employ cell- and tissue-based products and services.
The Company competes with Organogenesis, Advanced BioHealing, Tengion, Genzyme, HumaCyte and Cytograft Tissue Engineering.
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