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"From my conversations with investors, I came away with optimism about the future of healthcare, mainly because medical innovation seems to be picking up again."
"There is a general consensus the U.S. Food and Drug Administration has loosened up a bit."
"Investors expect next year to be a "stock picker's market," a term that always initially strikes me as tautological but simply suggests the biotech sector may be directionless or overly volatile. I agree, but would add my view that the market will increasingly reward only true medical innovation going forward."
"Cost pressures on the healthcare system will invariably increase over time. Eventually, I think these dynamics will force more widespread adoption of cost-effectiveness analysis such as the roughly $50,000 Quality Adjusted Life Year (QALY) threshold used by the U.K.'s National Institute for Health and Clinical Excellence (NICE).
Company executives always complain that increased use of cost-effectiveness analyses will quash innovation. I call shenanigans. No other segment of the economy benefits from annual "inflation driven" price hikes in perpetuity for a stagnant product, yet innovation abounds. It's becoming increasingly clear that the salad days of healthcare pricing are over and executives need to adjust accordingly."