How to Analyze a Healthcare Company and Navigate Regulatory Risk

Healthcare, companies, face, a, unique, risk:, regulatory, decisions., These, choices, can, determine, if, a, company’s, key, product, will, ever, make, real, money., The, FDA, (U.S., Food, and, Drug, Administration), usually, has, to, approve, new, drugs, and, many, medical, devices, before, they, can, be, sold, legally, in, the, U.S., This, process, takes, years., It, moves, through, preclinical, testing, and, Phase, 1,, 2,, and, 3, clinical, trials,, each, one, testing, safety, and, effectiveness, with, larger, groups, of, patients., A, single, approval, or, rejection, at, the, end, of, that, lengthy,, costly, journey, can, be, decisive, for, a, pharmaceutical, company's, future.

Pharmaceutical, companies, also, deal, with, the, well-known, "patent, cliff":, when, a, drug's, patent, protection, ends,, lower-cost, generic, competitors, can, enter, the, market., This, usually, leads, to, a, sharp,, predictable, revenue, drop, for, the, original, branded, drug., Plus,, since, a, lot, of, healthcare, industry, revenue, comes, from, government, programs, like, Medicare, and, Medicaid,, and, insurance, reimbursement, systems,, changes, in, healthcare, policy, pose, a, direct, revenue, risk., This, isn’t, something, many, other, sectors, face, to, nearly, the, same, degree.