I don't know if anyone else follows economic/political events in Japan. To me, they are important because Japan is a large creditor nation, because Asian growth is the most significant in the world and is heavily financed from Japan, and because there are many biotech partnerships with Japanese companies; especially, with those companies listed here. For S&P to say that the Japanese pharmas will not be killed by price roll-backs is a different thing than saying their US/European partners won't be hurt. Of course, my expectation is that yen will decline severely in the next few years.
There is deflation, and Japan has the largest proportion of aging population in the world. Will the US follow this path?
S&P downplays drug price cuts
Standard & Poor's Corp. said Wednesday that the Japanese government's planned cuts in drug reimbursement prices will have a limited impact on its ratings for seven Japanese pharmaceuticals.
The U.S.-based credit rating agency's bulletin concerns its short-term debt rating of A-1-plus for Takeda Chemical Industries Ltd., the A-plus-pi long-term rating for Sankyo Co., and the AA-minus-pi long-term rating for Yamanouchi Pharmaceutical Co.
Also concerned are the A-pi long-term ratings for Eisai Co., Fujisawa Pharmaceutical Co., and Daiichi Pharmaceutical Co., as well as the BBB-plus-pi long-term rating for Chugai Pharmaceutical Co.
Japan's Ministry of Health, Labor and Welfare on Tuesday announced a planned revision in drug reimbursement prices under the National Health Insurance system for fiscal 2002 beginning April 1. The revision will result in an average decrease of 6.3 percent.
S&P said the decrease will bring down prices for the drug companies by a range of about mid-5 percent for Fujisawa and upper-7 percent for Daiichi for their drugs listed under the system.
But the reduction is unlikely to lead to a substantial deterioration in cash flows at the companies, although it may have a greater impact in the medium and long term, if the government reduces reimbursement prices further, it said.
The Japan Times: March 14, 2002
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P.S. I know this concept is way too geeky for response from the hot stock seekers. |
