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Fast Foreward by
Rick Dana Barlow
The White House on reforming healthcare:
Is CPR or shock paddles needed?
HIDDEN AGENDA. No
sooner did President Bush put the brakes to his annual State of the
Union speech before Congress and the American people on January 31 than
healthcare associations began issuing press releases extolling Bush’s
support for various aspects of healthcare reform, leading snarkitect
columnists like me to wonder if we listened to the same oration. Why? It
appears his focus on healthcare is much ado about nothing – or at least
slipping into the shadow of security and energy. What a shame. With a
doctor as Senate Majority Leader (and whose family created HCA), several
prominent legislators pushing for healthcare reform, focusing on
information technology and insurance, the issue seems to be getting the
short shrift again (even as the public rank it near the top). At more
than 5,300 words, the Bush speech devoted one paragraph to healthcare –
162 words – and only one 22-word sentence on the need for an electronic
health record. With the appointment of David Brailer in 2003, momentum
began to build, start to boil in 2004 and simmer in 2005. So much for
that 2014 deadline for a national electronic health record. In fact, one
recent survey found that physicians no longer buy the deadline as firm
or even attainable. What’s needed is active and vocal support
communicated in a consistent message. For all intents and purposes, it
appears Bush has turned down the gas to low to focus on other more
pressing priorities. Maybe we should just open the windows so we don’t
become addicted to mere talk about change and improvement. Or switch to
an alternative fuel – one that doesn’t come from unstable parts of
Washington.
TAPPED OUT. Now that
Boston Scientific appears to be the "apparent" victor over Johnson &
Johnson in overpaying for recall poster child Guidant Corp. it’s
gratifying to know that all of the bickering in this fiscal love
triangle likely will be for naught within five years. That’s because
pharmaceutical companies like Pfizer are experimenting with drugs
(involving synthetic proteins) that function like liquid drain cleaners,
clearing out cholesterol-clogged arteries without the use of
angioplasty, bypass surgery or stents. After cashing in on its stent
devices (and cashing out on Guidant), maybe J&J ought to redirect its
acquisition strategies toward drug pursuits.
SLIM PICKINGS. With
Guidant fusing to Boston Scientific, spurned acquisitor Johnson &
Johnson now has two competitors that have gained some legitimate muscle,
which may cause some long-term market share headaches. That’s because
Boston Scientific agreed to sell Guidant’s vascular intervention and
endovascular business to Abbott Laboratories to satisfy antitrust
regulators and seal the Guidant deal. What may be next for J&J? The
Boston Globe reported that the company may chase targets like
Medtronic Inc. (less likely because of its size) or St. Jude Medical.
The analyst quoted by the Globe indicated that J&J "would have to
buy a device maker because it would take up to a decade to create its
own product line, given hurdles such as patents, engineering talent,
clinical testing and regulatory approval." So how come it’s not looking
at Tyco’s ripe healthcare division?
TYCO TICKER.
Embattled and scandal-ridden Tyco International recently announced plans
to split into three companies to maximize shareholder value: Tyco
Electronics, Tyco Fire & Security and Engineered Products & Services and
Tyco Healthcare. Fortunately, Tyco Healthcare has been the crown jewel
of the stitched-together patchwork quilt of companies in the crumbling
empire under imprisoned former CEO L. Dennis Kozlowski and imprisoned
former CFO Mark Swartz. Both justifiably were nailed last year for grand
larceny, conspiracy, securities fraud and falsifying business records,
and are appealing their convictions. Arrogance and hubris aside,
Kozlowski once said he envisioned Tyco as becoming the next GE (Koz
claimed Jack Welch was his hero). Media outlets (including
HPN)
quoted Koz as saying he wanted Tyco Healthcare to "own the operating
room." Unfortunately, for all the ethical and hard-working folks at the
Tyco Healthcare units (e.g., Kendall, U.S. Surgical, Mallinckrodt,
Nellcor, etc.), Koz has been a stain on the untarnished group. So it’s
welcome news that Tyco Healthcare finally is separating itself from the
others. But to make it permanent and real it has to shed the Tyco name,
which remains a stigma. Kendall Healthcare’s Rich Meelia heads up the
successful healthcare group. Because Kendall was Tyco’s first healthcare
acquisition, I once again propose that Tyco Healthcare adopt the
respectable and storied name of Kendall Healthcare, which has a long
history in the industry and valuable name recognition. Sometimes
reaching back into the past is the best way to move forward.
Buy smart, readers |
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March
2006
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