Biotech Values

[DewDiligence]

So far, NVS is the only Big Pharma that hasn’t lowered sales and EPS guidance to account for ObamaCare. Why hasn’t it? Simple arithmetic: 60% of NVS’ sales come from the pharma division and only one-third half of that comes from the US. Thus, only 20% of NVS’ revenue is from US branded drugs; this compares to 50% for LLY (#msg-49185651) and 55% for GILD.

Moreover, of the 20% of NVS’ revenue from US branded drugs, relatively little of it is attributable to patients on Medicaid, and hence NVS has a low exposure to the increased Medicaid rebates under ObamaCare.