Larry Robbins On Amazon Vs Pharma

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Larry Robbins On Amazon Vs Pharma

Larry Robbins on the healthcare sector and the non threat from Amazon.

Premium coverage on the 2018 Sohn Conference in NY can be found here

 

Fund Manager Profile: Kris Sidial Of Tail Risk Fund Ambrus Group

invest Southpoint CapitalA decade ago, no one talked about tail risk hedge funds, which were a minuscule niche of the market. However, today many large investors, including pension funds and other institutions, have mandates that require the inclusion of tail risk protection. In a recent interview with ValueWalk, Kris Sidial of tail risk fund Ambrus Group, a Read More

Q1 hedge fund letters, conference, scoops etc

 

Klarman 2017 letter on

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Will Amazon enter the pharmacy supply chain? We think they may do something in next ten years. What could they do? They can offer limited supply for generic pharma. Will they get into PBM, we think no. Do we think distribution, we think no. We think in market place, imminently yes. How did people start talking about Amazon entering pharmacy. Axios reported that Amazon was talking to PBMs; fueled takeover speculation in Express Scripts and fueled speculation that going into PBM business. CNBC.com did a story saying Amazon was brink of deciding whether to selling drugs online.

Axios report was based on another report and when contacted, said report was taking out of context. Everything was just whispers of the same report. Did gain pharmacy license? No they got durable medical equipment license. These are different. CNBC reported that it was on brink of getting into pharmacy; decide by thanksgiving. We checked all the different sources. Yes, they hired some people from CVS and Express for web services business; didn’t hire anyone from pharmacy – no known hires. It was a very misleading scoop. CNBC.com has another article saying they shelve a plan to sell drugs to hospitals. We didn’t even think they had a plan to do this. 13.4mm hits if google “Is Amazon going to pharmacy business?” Most say yes.

Amazon isn’t in the business and don’t believe they are getting in because barriers of entry even for Amazon. Need separate cold storage and Amazon doesn’t have. UPS tried going in 2006 but couldn’t because need scale and the big ones have 90%. There are brand barriers, regulatory barriers and this is a high touch service which you simply cannot automate. For brands, failures / errors can cause death.

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Jacob Wolinsky is the founder of ValueWalk.com, a popular value investing and hedge fund focused investment website. Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and four kids in Passaic NJ. - Email: jacob(at)www.valuewalk.com - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities anymore to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own a few grams of Gold and Silver
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