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Our briefing for Tuesday, January 11, 2022:
Jan 11, 2022 3:21:22 PM
- The United States reported 1.35 million new cases of Covid-19 on Monday, the highest daily total for any country in the world since the beginning of the pandemic. In the last two weeks, the 7-day average has tripled to roughly 700,000 new infections daily. Monday also saw the number of hospitalizations reach 136,604, breaking the previous record of 132,051 set in January of last year. With cases rising, cities across the country are struggling to keep up. New York City was forced to close three subway lines as many workers are out sick. In Chicago, schools have been closed for several days as teachers and administrators attempt to cope with mass infections. Chief Executive Officer for Pfizer, Albert Bourla, has said that the need for an Omicron-specific vaccine is evident and that company intends to have one available by March. “The two doses, they’re not enough for Omicron,” Bourla said. “The third dose of the current vaccine is providing quite good protection against deaths, and decent protection against hospitalizations.”
- Canadian provinces are urging the federal government for more rapid antigen tests as the Omicron variants sweeps through the country at an alarming rate. In the first intergovernmental meeting since December, Prime Minister Justin Trudeau and Minister for Intergovernmental Affairs Dominic Leblanc advised the provinces that requests will be met as soon as possible. Members from the three opposition parties called for an emergency meeting of the House of Commons to be held before the end of week to press for more aid from the federal government in relation to the surging case numbers seen nationwide. Currently, the federal government has promised to allocate 140 million rapid tests to the provinces in January. “While we will do everything we can to respond,” Leblanc said. “It’s important to remember that health care ultimately is a provincial and territorial jurisdiction and we as a government have to efficiently use the federal resources we can bring to bear to fill the gaps the provinces and territories are identifying.”
- In the U.K., Prime Minister Boris Johnson is again under fire as new emails have leaked surrounding a party held at No.10 Downing Street, the prime minister’s residence, during the first Covid-19 lockdown in 2020. The emails allegedly came from the prime minister’s Principal Private Secretary Martin Reynolds and invited nearly 100 guests to a “bring your own booze” party in the garden of 10 Downing Street. Johnson and his partner were in attendance at the party on May 20th, along with 40 of the PMs staff. At the time of the party, schools, bars, and restaurants had been closed and social gatherings were prohibited. This is not the first time questions have been raised about parties held by the Conservatives during the pandemic. Earlier this year, a video surfaced online showing members of the party joking about a party over the Christmas holidays when the country was once again on lockdown. A senior government official, Sue Gray, is currently investigating five parties that were alleged to have been held by government departments during lockdowns.
- Spain is asking the rest of Europe to debate the possibility that Covid-19 could be treated as an endemic illness, similar to the common cold or flu. Prime Minister Pedro Sanchez said in a radio interview on Tuesday that because death rates have been dropping since the start of the pandemic, the virus is no longer severe enough to warrant the classification. “It’s a necessary debate; Science has given us the answer to protect ourselves,” he said. “We have to evaluate the evolution of Covid from pandemic to an endemic illness.” Spain has started to monitor the illness with a different set of parameters, and Health Minister Carolina Dariasis is discussing with her European counterparts about how to treat the still surging case numbers. According to Health Ministry data, Spain reported almost 692,000 new cases of Covid-19 in the last 7 days, and 13.4 per cent of hospital beds are being used to treat Covid patients. However, compared to last year, Covid patients made up 11.8 per cent of beds, and case numbers were roughly 115,000 per week.
- China has once again put an entire city on lockdown as more cases of the Omicron variant have been detected in the province of Henan. Residents of the city of Anyang have been told to remain in their houses and the use of vehicles has been prohibited after two people tested positive on Monday. As of Tuesday, 58 people in the city have tested positive, although, there has been no confirmation on whether those cases were of the Omicron variant. The new cases have Chinese authorities worried as Henan province lies adjacent to Hebei province which is hosting several snow sports for the Winter Olympic Games. China reported 110 new cases of the virus on Tuesday, with 87 of them coming from Henan province. All businesses in Anyang were forced to close, and tickets for travel to Beijing are no longer being sold. In the provincial capital of Zhengzhou, all restaurants have been closed for in-person dining and all non-essential business have been told to close.
Covid-19 – Due Diligence And Asset Management
Fed Vice Chair Clarida to step down early following scrutiny over his trades during pandemic
Brief: Federal Reserve Vice Chairman Richard Clarida said Monday he will be leaving his post with just a few weeks left on his term and amid revelations regarding his trading of stock funds. In an announcement released Monday afternoon, Clarida said he will be stepping down from his post this Friday. His term expires on Jan. 31. The move comes following additional disclosures regarding trades Clarida made in February 2020, around the time when the Fed was getting ready to roll out what eventually would become its most aggressive policy tools ever, in an effort to combat the Covid crisis. “Rich’s contributions to our monetary policy deliberations, and his leadership of the Fed’s first-ever public review of our monetary policy framework, will leave a lasting impact in the field of central banking,” Fed Chairman Jerome H. Powell said in a statement. “I will miss his wise counsel and vital insights.” Clarida’s exit comes amid heightened scrutiny over what he had described as pre-planned portfolio rebalancing on Feb. 27, 2020. However, recent disclosures, first reported by the New York Times, showed that three days earlier, Clarida sold shares in three stock funds that he would repurchase on the 27th.
Healthcare sector sees record VC investments in 2021
Brief: VC-backed exits and healthcare funding/investment both set new records yet again in 2021, according to Silicon Valley Bank’s (SVB) annual Healthcare Investments and Exits report. New venture funds allocated to healthcare in 2021 almost doubled 2020’s record with investment into companies exceeding USD86 billion in the US & EU (30 per cent increase from 2020) leading every sector to hit record highs. While the venture backed healthcare industry saw record IPO activity across the board the average post-IPO performance for 2021 was muted (-21 per cent average) and similarly while SPAC mergers were also up this year it was a poor year for de-SPAC performance (-44 per cent average). Healthtech experienced the greatest increase in investment of 162 per cent. Part of this growth is due to the device market, which saw a four-times increase in European investment specifically. Healthtech also saw the number of financials with USD1 billion-plus valuations explode and the creation 42 new unicorns (four-times more than 2020). Biopharma saw increased funding in platform, neurology and anti-infective while orphan/rare activity continued to slow.
JPMorgan's Jamie Dimon warns unvaccinated New York staff could be terminated
Brief: Unvaccinated New York-based staff at JPMorgan Chase risk losing their jobs, Chief Executive Officer Jamie Dimon said on Monday in a further indication that banks are getting tougher on employees as they return to work. “If you aren’t going to get vaxxed, you won’t be able to work in that office. We’re not going to pay you not to work in the office,” Dimon said. “We want people to get vaccinated.” Last week, Citigroup Inc said staff in the United States who had not been vaccinated against COVID-19 by Jan. 14 would be placed on unpaid leave and fired at the end of the month unless granted an exemption. Asked about a possible hybrid work policy in the future by which employees split their time between home and the office, Dimon said: “We don’t have to answer this right away.”
More insurance brokerage M&A expected for 2022
Brief: Consolidation in the insurance brokerage space is expected to continue at a rapid pace through 2022, following a trend from the last 12 months where brokerage transactions drove the majority of announced insurance merger and acquisition (M&A) activity worldwide. PwC’s ‘Insurance Deals Insights: 2022 Outlook’ projects “continuing consolidation in the insurance brokerage space,” especially from private equity-backed firms. This has resulted in “high multiples for insurance brokerage targets [which] shows no signs of stopping” in 2022, according to PwC. Over the past few years, as the world has grappled with the COVID-19 pandemic and related economic challenges, the insurance brokerage space has proven to be very profitable, lucrative, and resilient, according to Mark Friedman, a partner in PwC’s Financial Services Deals practice where he supports private equity and corporate clients with transactions in the insurance sector.
Ten key medtech themes for 2022
Brief: The COVID-19 pandemic has accelerated the transformation of business models in the life sciences industry, with digital initiatives coming to the forefront. The combination of rapid technological innovation and disruption of traditional models of care has expedited the integration of medtech—digital health, wearables, AI-driven offerings, diagnostics, telemedicine, and other health IT solutions—in healthcare. Here are ten global medtech themes we are tracking in the coming year: Focus on digital and data assets in life sciences/healthcare M&A. Globally, life sciences technology companies, private equity and other financial investors are focussing on the value of digital and data assets as they evaluate potential targets. We expect to see both the continued consolidation of digital health players along the lines of the Ginger-Headspace merger as well as additional acquisitions by Big Tech and Big Pharma such as Oracle’s acquisition of Cerner to bring complementary datasets, expertise and capabilities from different segments, regions, and specialties in-house to enhance product and service offerings.
