A Revaluation of the Health Care Universe: Innovation Looking to Pick Up, Leading to Growth Across the Industry and More Stable Pricing if Reform Turns Out to Be Healthy

Wall Street Transcript

67 WALL STREET, New York - August 20, 2013 - The Wall Street Transcript has just published its Medical Research, Diagnostic Substances and Life Science Tools Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs and Equity Analysts. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Health Care Consolidation Activity - Cost Reduction and Improving Efficiencies - Cost Reduction Amid Reimbursement Uncertainty - Health Care Growth Sectors Identified

Companies include: Illumina Inc. (ILMN), Hologic Inc. (HOLX), Thermo Fisher Scientific, Inc. (TMO), Life Technologies Corporation (LIFE), Walgreen Co. (WAG), AmerisourceBergen Corporation (ABC), Express Scripts Inc. (ESRX), Agilent Technologies Inc. (A), ICON plc (ICLR), Cardinal Health, Inc. (CAH), MedAssets, Inc. (MDAS), CVS Caremark Corporation (CVS), Cepheid (CPHD) and many more.

In the following excerpt from the Medical Research, Diagnostic Substances and Life Science Tools Report, an expert analyst discusses the outlook for the sector for investors:

TWST: Who is at the top of your list at this point?

Mr. Muken: We obviously cover a lot of spaces, but I can rattle off a couple of winners. We really like - I mentioned before Thermo Fisher, which will be the combination of they and Life Technologies. We think it's a real leader across the life science space enabling all source of R&D and productivity tools across pharma, biotech, academic research, food testing, environmental testing, lots of different subsegments. Great cash flow generation and really stellar management, and we think that one is quite attractive.

I think Agilent (A) continues to be another interesting story, that more from a structural change, and there are complex assets; there was some tech businesses mixed in. We think there is the opportunity to restructure what is a very high-quality technical business that focuses on all sorts of analytical tools, and unlock value there and use what is a great cash-flow generation stream and also a very clean balance sheet to return that capital incrementally to investors.

We also like ICON (ICLR), which is a small-cap CRO. We think they're well-positioned to play off of the outsourcing theme in health care. Really top-notch management, ability to drive incremental margins there to get total op margins up from the high single digits to the low teens, and we think that that could drive the stock meaningfully higher.

We also like Cardinal Health (CAH) in the service complex - great pharma distributor, pharma wholesaler. They had a challenging 2012, 2013 through the loss of Express Scripts and Walgreens. They're now compounding against that. There could be a lot of cash flow deployment, they're re-establishing their medical side of business, and we think stocks are quite inexpensive. You've got a great positive bias toward dividends, and there is a lot more, we think, that can come on the M&A side that continues to...

For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

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