Q3美国医疗供应链预览：基本面稳定

1、Global Research29 October 2019US Healthcare Supply ChainAmericas3Q19 Previews: Stability in Fundamentals Provides for Positive Set Up Into the Print3Q Fundamental Set-up into earnings: Pharma EBIT should be fineWhile a majority of the focus on the quarter was on the companies opioid litigation, fund

2、amentals for the pharma distribution segment remained steady, with generic deflation on a two-year stacked basis flattening and brand inflation remaining below 4% (see charts on page 2). We think the re-contracting of specialty and brand will again be a tailwind to margins in the quarter, especially

3、 for ABC and MCK. We are above consensus for the quarter for MCK on these trends and outsized growth in its high-margin NorthStar business. We are basically in-line on ABC for the quarter and1% below consensus on F2020 due to lower capital deployment. For CAH, our numbers for the year are basically

4、in-line, but back-end loaded in Medical to account for the recent change in salesforce compensation model. We do not expect to get any incremental opioid litigation updates on the earnings calls this quarter.Key areas of focus for the calls1) ABC FY20 guidance details; 2) any updates to opioid settl

5、ement; 3) Commentary around pricing trends during the quarter (generic deflation, specialty repricing) and the margin impact/outlook; 4) ABC: animal health market growth and thoughts on MWIs ability to take share; 5) Update on OUS pharmacy reimbursement for CAH and MCK; 6) Impact of CAHs medical sal

6、esforce restructuring.Model and PT ChangesOur ABC and CAH PTs remain unchanged (ABC at $108 (Buy), CAH at $48 (Neutral) and MCK moves to $151 (from $148). We make the following changes to our models: ABC - FY20 EPS estimates lower (to $7.50 from $7.67) to reflect lower share repurchases in FY20, off

7、set by slightly higher Other segment margins; MCK - FY20 and out-year EBIT moves higher by 2% on higher Pharma margin from specialty repricing and wrap-around services; CAH - FY20 Pharma revenue growth to +4.0% (from+3.0%), FY20 Medical revenue growth to +0.4% (from +1.2%) following a shift in sales

8、force compensation structure which pays reps solely on CAH branded sales, and FY20 Pharma segment margins up 6bp to 1.22% (19 bp decline y/y).HealthcareEquitiesKevin CaliendoAnalyst HYPERLINK mailto:kevin.caliendo kevin.caliendo+1-212-713 3630Adam Noble Associate Analyst HYPERLINK mailto:adam.noble

9、adam.noble+1-212-713-9495Brett Gasaway Associate Analyst HYPERLINK mailto:brett.gasaway brett.gasaway+1-212-713 4820 HYPERLINK /investmentresearch /investmentresearchThis report has been prepared by UBS Securities LLC. ANALYST CERTIFICATION AND REQUIRED DISCLOSURES BEGIN ON PAGE 23. UBS does and see

10、ks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.G

11、eneric Deflation TrendsThe average generic drug in the dataset saw its price drop -4.7% yr/yr in September, a 170bp sequential improvement from the yr/yr decline seen in August (-6.4%). We note, the 2-year stack has continuously improved over the last year (refer below), but has leveled off somewhat

12、 during the last 2 months in the - 15% range. At this point, we believe the data supports management commentary that the sell side is competitive, yet stable. Note, lower pharmacy acquisition generic pricing is generally more beneficial to drug retailers and negatively impacts wholesalers. The Septe

13、mber data would suggest sequentially perhaps less margin pressure on wholesalers and increased pressure on pharmacy generic margins.Figure 1: September 2019 Generic Deflation -4.7% vs. -11.0% in September 20180.0%-2.0%Figure 2: 2-Year Generic Y/Y Pricing Stacked Trend Steady at (15%)-14.0%-4.0%-4.72

14、%-16.0%-6.0%-18.0%-8.0%-10.0%-20.0%-12.0%-10.96%-22.0%-14.0%-16.0%-18.0%Jun-17Dec-17Jun-18Dec-18Jun-19Source: UBS Evidence Lab, Glass Box Analytics - Predictive Acquisition Cost (PAC), IMS Health; price data as of September 30, 2019-24.0%-15.68%-26.0%Jun-18Sep-18Dec-18Mar-19Jun-19Sep-19Source: UBS E

15、vidence Lab, Glass Box Analytics - Predictive Acquisition Cost (PAC), IMS Health; price data as of September 30, 2019Brand/Specialty Inflation TrendsBrand inflation has been sitting below 4% all calendar year and did not receive a boost from the July 1 price increases, which historically had represe

16、nted 25% of all price increases taken in a given calendar year. The lack of brand inflation has been a headwind of sorts for the wholesalers, who had discussed MSD level inflation as the base case for their expectations. We note inflation and price increases are less of a driver of EPS growth now th

17、an in the past given the higher FFS component built into manufacturer contracts, but we estimate that every 1% of inflation still can move EPS 2% annually.Figure 3: Y/Y Branded Price Change June 2017 to August 201910%9%8%7%6%5%4%3%2%1%0%Jun-17Sep-17Dec-17Mar-18Jun-18Sep-18Dec-18Mar-19Jun-19 ALLSPECI

18、ALTYTRADITIONALSource: Source: UBS Evidence Lab, Glass Box Analytics - Predictive Acquisition Cost (PAC), IMS Health; price dataas of August 7, 2019Figure 4: Y/Y Decline in Inflation Steady Sequentially in August0 bp(50) bp(100) bp(150) bp(200) bp(250) bp(300) bp(350) bp(400) bp(450) bp(500) bpJun-1

19、8Aug-18Oct-18Dec-18Feb-19Apr-19Jun-19Aug-19 ALLSPECIALTYTRADITIONALSource: Source: UBS Evidence Lab, Glass Box Analytics - Predictive Acquisition Cost (PAC), IMS Health; price data as of August 7, 2019ABC (BUY, $108 PT)Set-up into the Call: F20 Guidance fears might be a bit overblown, but we dont se

20、e material upside eitherHeading into the print, we believe managements guide for FY20 pharma margins and profits remains the biggest delta given the trend of improvement in recent quarters and the perceived positive impact from a repriced specialty book versus some non-core headwinds management has

21、called out, including a tough health benefits comp, and faster than anticipated accretion from HD Smith in F19. We are slightly below consensus in F20, primarily in the Other segment (see charts below), while our pharma margins and EBIT are basically in line with consensus.On the animal health side,

22、 production markets remain weak (PDCO commentary intra-quarter suggested this is not a transitory event), but we believe investors expect MWI will continue to take share following the first $1B+ revenue quarter in F3Q19 and competitor weakness (PDCO production weakness, CVET commentary around weak f

23、oot traffic in veterinary practices). We are modeling +5.5% growth in FY20 Other revenues, which we believe is achievable given strength in the Consulting business and MWI, but note there could be downside risk given generally neutral-to-positive sentiment around the segment.While we believe the cor

24、e distribution business will see modest margin pressure in FY20, ABCs repriced specialty and brand book and growth in higher-margin services and consulting should provide enough support to offset some of the one- timers we mentioned earlier. We have no incremental growth or decline built in for phar

25、MEDium.What we expect the stock to do on November 7thABC is flat since reporting on August 1 vs +1.5% for the S&P. Short interest is roughly flat at 5.3% since the last print, but has come down from its peak since reports of the potential opioid settlement were published. Although we are 1% below EP

26、S consensus for F20, we do not think the guidance will be a meaningful issue relative to street expectations. The bigger driver could be FCF guidance as investors are very focused now on how impactful an annual opioid settlement would have on FCF going forward. Otherwise we would expect this quarter

27、 to have a somewhat muted stock response.AmerisourceBergen Corporation (ABC-USA)87.07 1.09 1.27% 11:46:26 AM USD50 Day M oving Average200 Day Moving Averag e2018/10/25 - 2019/10/25959087.078584.1482.2680757014 Period (RSI)7058.5530NovDecJanF ebMarAprMayJunJulAugSepOct50Figure 5: ABC 1-Year Trading R

28、ange and 14-Day RSISource: FactsetIntra-Quarter Buying/SellingInsiders: No material un-planned sales/acquisitions during the quarter.Critical Variables for the Call1) FY20 Guidance; 2) Any update to opioid litigation proceedings; 3) Commentary around specialty repricing during the quarter, and the i

29、mpact to margin going forward; 4) Update on generic deflation and branded pricing; 5) Progress on PharMEDium re-opening; 6) Animal health market growth and thoughts on MWIs ability to take share; 7) Thoughts around the impact from potential drug pricing reform.Changes to the Model & PTWe are revisin

30、g our FY20 EPS estimate lower (to $7.50 from $7.67) to reflect lower share repurchases in FY20, offset by slightly higher Other segment margins. Our$108 PT (unchanged) assumes ABC can trade 10 x (unchanged) our $2.5B CY20 EBITDA.ABC FY20 Bridge and FY20 TablesIn FY20, we model the majority of EPS gr

31、owth coming from capital allocation (primarily share repurchases) and growth in pharma margins, which are benefitting from a repricing of the specialty book in FY19. Note, we model an incremental$0.02 of HD Smith synergy capture in FY20 following earlier-than-expected synergy realization in FY19. Ho

32、wever, this benefit is more than offset by the $0.07 headwind from lower-than-expected healthcare benefit costs which positively impacted 2Q19 and 3Q19 (and are not expected to repeat). Note, we lowered our allocation of free cash flow to share repurchases in FY20 to reflect conservatism around cash

33、 management related to a potential opioid settlement.Figure 6: FY20E EPS Bridge$7.70$7.60$7.50$0.11$0.02$0.22($0.07)$7.40$7.30$7.20$7.10$7.03$7.00$6.90$6.80$6.70$0.00 $0.00 $0.00$0.19 $0.05($0.04)$7.50$7.58Source: Company Data, UBS ResearchWe model double-digit specialty revenue growth alongside gen

34、eric deflation/branded inflation of -7%/+2.5%, respectively. We expect continued margin pressure on both the generic and branded books (albeit stabilizing), but model an improvement in the specialty margin given the repricing in FY19.Figure 7: FY20E Revenue and EBIT Bridge Core Pharma DistributionEs

35、timated EBITFY19 Pharma Distro Revenue172,134.91,677.7Less: FY19 HD Smith3,124.135.6Less: FY19 Pharmedium0.00.0Less: 3Q19 employee healthcare expense benefit18.7FY19 Core Revenue169,010.81,623.3Specialty % of Revenue27.0%FY19 Specialty Revenue45,632.9FY20E Specialty Revenue Growth13.9%FY20E Specialt

36、y Volume Growth1.0%Less: % of revenue from generic launches-3.0%FY20E Specialty Revenue51,049.3Generic % of Revenue13.5%FY19 Generic Revenue22,816.5FY20E Generic Launch Revenue8.6%FY20E Generic Revenue Growth-7.0%FY20E Generic Volume Growth1.0%FY20E Generic Revenue23,419.8Branded % of Revenue59.5%FY

37、19 Branded Revenue100,561.4FY20E Branded Revenue Growth2.5%FY20E Branded Volume Growth1.0%Less: % of revenue from generic launches-3.0%FY20E Branded Revenue101,064.2FY20E Core Revenue Growth3.9%FY20E Estimated Core Revenue175,533.3Revenue Bridge6,522.53.9% GrowthOp MarginEstimated FY19 Specialty Ope

38、rating Income365.10.8%Estimated FY20E Specialty Operating Income463.50.9%Estimated FY19 Generics Operating Income4,768.620.9%Estimated FY20E Generics Operating Income4,871.320.8%Estimated FY19 Branded Operating Income(3,510.3)-3.5%Estimated FY20E Branded Operating Income(3,652.1)-3.6%Estimated FY19

39、Core Pharma Distro Operating Income1,623.40.96% Estimated FY20E Core Pharma Distro Operating Income1,682.7 0.96%Operating Income Bridge59.4Source: Company Data, UBS ResearchWe continue to expect MWI will take share in the animal health market with above-market mid-single digit growth, alongside mid-

40、single digit growth in the higher-margin consulting side of the business. It is unclear how much margin that growth in MWI will have given it is largely coming from corporate customers. Overall, we believe Other margin should improve year over year, reflective of mix, cost control, and an easy gross

41、 margin comp vs. FY19 when clients were being on- boarded onto the Fusion platform.Figure 8: FY20E Revenue and EBIT Bridge OtherFY19 Other Revenue6,750.1MWI % of Revenue60.0%FY19 MWI Revenue4,050.1FY20E MWI Revenue Growth5.0%FY20E MWI Revenue4,252.6World Courier % of Revenue15.0%FY19 World Courier R

42、evenue1,012.5FY20E World Courier Revenue Growth6.0%FY20E World Courier Revenue1,073.3ABC Consulting % of Revenue25.0%FY19 ABC Consulting Revenue1,687.5FY20E ABC Consulting Revenue Growth6.5%FY20E ABC Consulting Revenue1,796.9FY20E Core Revenue Growth5.5% FY20E Estimated Other Revenue7,122.7 Revenue

43、Bridge372.6Estimated FY19 Other Operating Margin5.60%Estimated FY19 Other Operating Income378.0Estimated FY20E Other Operating Margin5.74%Estimated FY20E Other Operating Income408.6Operating Income Bridge30.5Source: Company Data, UBS ResearchWe model a $0.07 headwind to FY20 from lower MLR on employ

44、ee healthcare benefit expenses in 2Q19 and 3Q19 which are not expected to repeat.Figure 9: FY20E Revenue and EBIT Bridge 3Q19 Healthcare Benefit Expense Headwind2Q/3Q19 Benefit per share$0.07 3Q19 earnings call3Q19 Shares211.2Expense Benefit Post-Tax(14.8)FY19 Tax Rate21.0%Expense Benefit / FY20 hea

45、dwind(18.7)Source: Company Data, UBS ResearchManagement has stated that expected synergies from HD Smith have come in faster than originally expected and may have boosted F2019 more than originally modeled. This makes for a tougher comp and less EPS growth in F20 on a yr/yr basis.Figure 10: FY20E Re

46、venue and EBIT Bridge HD Smith SynergiesFY17 Revenue153,143.8FY18 HD Smith Revenue Growth Contribution1.5%FY18 HD Smith Estimated Revenue2,297.2Months in FY18 Results9.0Annualized FY18 HD Smith Revenue3,062.9FY19E HD Smith Growth2.0%Estimated FY19E HD Smith Revenue3,124.1 FY20E HD Smith Growth2.0%Es

47、timated FY20E HD Smith Revenue3,186.6Revenue Bridge62.5Estimated FY19 HD Smith Operating Margin1.1%Estimated FY19 HD Smith Operating Income35.6Estimated FY20E HD Smith Operating Margin1.3%Estimated FY20E HD Smith Operating Income41.4Operating Income Bridge5.8Source: Company Data, UBS ResearchUBS vs.

48、 ConsensusWe model revenues of $44.8B for the quarter (0.9% below the street and up3.6% yr/yr). We note the wholesalers have beaten on the top line (and exceeded market growth in general) for several quarters running now, so our top line again could be conservative. We think our estimates are achiev

49、able, supported by historical trends below and margin benefit from a repricing of the specialty book.Figure 11: ABC 4Q Revenue Growth Y/Y and Q/QF4Q16F4Q17F4Q18F4Q19E3-YrAvgYr/YrSeq.Yr/YrSeq.Yr/YrSeq.Yr/YrSeq.Yr/YrSeq.Revenue GrowthTotal Revenue5.9% 1.8%4.2%1.1%10.7%0.4%3.6%-0.9%8.0%4.2%Pharmaceutic

50、al Dist.6.7% 2.5%3.9%1.1%10.8%0.3%3.5%-0.8%8.3%4.4%Other-15.3% -16.3%12.2% 0.8%7.9% -0.1%5.2% -3.2%1.6% 0.8%Source: Company Data, UBS ResearchFigure 12: ABC UBS vs. Consensus, 4Q19E($ in millions , except per s hare data)Fiscal Year Ending UBS Consensus DeltaSept 30F4Q19EF4Q19EPharmaceutical Distrib

51、ution Services$43,186.9$43,596.0-0.9%Other1,679.21,687.9-0.5%Intersegment eliminations (22.6) (24.7)-8.4%Total Revenue$44,843.4$45,259.2-0.9%Pharmaceutical Distribution Services y/y growth3.5%4.5%-98 bpPharmaceutical Distribution Services q/q growth-0.8%0.2%-94 bpOther y/y growth5.2%5.7%-55 bpOther

52、q/q growth-3.2%-2.7%-50 bpIntersegment eliminations y/y growth-11.2%-3.0%-815 bpIntersegment eliminations q/q growth-0.9%8.2%-909 bpTotal Revenue y/ y growth3.6%4.5%-96 bpTotal Revenue q/ q growth-0.9%0.0%-92 bpPharmaceutical Distribution Services$375.7$372.40.9%Other$84.1$88.8-5.3%Corporate ($0.1)(

53、$0.1)34.5%Total Operating Income$459.7$461.1-0.3%Pharmaceutical Distribution Services Operating Margin0.87%0.85%2 bpOther Operating Margin5.01%5.26%-25 bpCorporate Operating Margin0.00%0.00%-0 bpTotal Operating Margin1.03%1.02%1 bpNet Income$328.4$331.8-1.0% growth4.2%5.3%-108 bpNet margin0.73%0.73%

54、-0 bpEarnings per share$1.56$1.58-1.5% growth7.5%9.0%-159 bpSource: Visible Alpha, UBS ResearchLonger term versus consensus, wemodel similar margindegradationin thepharma business and more conservative margin expansion in Other as weak end markets in animal offset some of the improvement from the Co

55、nsulting business. However, we model more aggressive share repurchases in the out years compared to consensus (8M average shares annually vs. consensus 7M shares).Figure 13: ABC UBS vs. Consensus, 2019-2021E($ in millions , except per s hare data)Fiscal Year EndingUBSConsensusUBS vs. ConsensusSept 3

56、0FY2019EFY2020EFY2021EFY2019EFY2020EFY2021EFY2019EFY2020EFY2021EPharmaceutical Distribution Services$172,134.9$178,720.0$185,065.5$172,544.2$180,768.9$189,218.5-0.2%-1.1%-2.2%Other6,750.17,122.77,437.96,758.87,157.77,558.0-0.1%-0.5%-1.6%Intersegment eliminations (90.3)(102.2)(105.9) (92.3)(98.4)(100

57、.7)-2.2%3.9%5.1%Total Revenue$178,794.7$185,740.4$192,397.5$179,210.7$187,828.2$196,675.8-0.2%-1.1%-2.2%Pharmaceutical Distribution Services y/y growth6.5%3.8%3.6%6.7%4.8%4.7%-25 bp-94 bp-112 bpOther y/ygrowth6.6%5.5%4.4%6.7%5.9%5.6%-14 bp-38 bp-117 bpIntersegment eliminationsy/ygrowth-2.3%13.2%3.6%

58、-0.1%6.6%2.3%-215 bp657 bp125 bpPharmaceutical Distribution Services q/q growth Other q/q growthIntersegment eliminations q/q growthTotal Revenue y/ y grow th6.5%3.9%3.6%6.7%4.8%4.7%-25 bp-92 bp-113 bpTotal Revenue q/ q grow thPharmaceutical Distribution Services$1,677.7$1,724.1$1,730.6$1,674.6$1,71

59、5.5$1,778.30.2%0.5%-2.7%Other$378.0$408.6$428.5$382.7$417.4$444.5-1.2%-2.1%-3.6%Corporate ($0.8)($2.3)($2.3) ($0.9)$7.4$8.9-7.5%-130.5%N/ATotal Operating Income$2,054.9$2,130.5$2,156.8$2,056.4$2,140.3$2,231.7-0.1%-0.5%-3.4%Pharmaceutical Distribution ServicesOperating Margin0.97%0.96%0.94%0.97%0.95%

60、0.94%0 bp2 bp-0 bpOther Operating Margin5.60%5.74%5.76%5.66%5.83%5.88%-6 bp-10 bp-12 bpCorporate Operating Margin0.00%0.00%0.00%0.00%0.00%0.00% 0 bp-1 bp-1 bpTotal Operating Margin1.15%1.15%1.12%1.15%1.14%1.13%0 bp1 bp-1 bpNet Income$1,492.5$1,551.0$1,586.7$1,496.0$1,563.4$1,642.9-0.2%-0.8%-3.4% gro