Questions about Healthcare Banking
Hey all,
With junior recruiting spinning up and with group selection for my BB SA internship starting soon, I wanted to ask about what analysts in healthcare groups do and if any of you have moral questions about the role you play? I'm super interested in HC and have read a number of books on the history of the medical-industrial complex in the USA, and personally I slightly disturbing how the incentives of doctors, insurers and pharmaceutical companies affect Americans with high and rising prices for drugs and insurance, poorer quality and less cost-effective care, etc.
Should I avoid hc groups for this reason? Are transactions ever justified on bases that are likely hurtful to the population, or are they justified on the usual bases of general cost-savings/synergies? Where else should I look to learn more about hc banking in particular? Do you think your work benefits society in the same way that work in other groups does?
I would really appreciate any insights, because depending on the details of the job I can see myself gunning for Healthcare as my top choice (as I would love to work in Healthcare VC in the future). Thanks!
You should not pursue HC banking. Based on this diatribe, HC venture would not be a good fit longer term for you either. The entire goal of HC venture is to fund science that will produce drugs that you can sell at high prices.
Alternatively, you could think about HC banking / venture as facilitating the process of helping patients. Helping a biotech raise capital could be the difference in life or death for patients if the funding allows them to develop a drug faster or study it in more indications simultaneously. Selling a biotech to a big pharma will help that drug reach many more patients must faster. Finance functions play an incredibly small role in that process, but to me it’s more of a “good impact” than any other industry group I know of.
Also, I think you have a one-sided view of the industry, at least re: drug prices. Quick food for thought: Innovation in pharmaceuticals is almost completely dependent on the potential profitability of drug development and the ability for this to attract private investment. If you want cures for more diseases, new drugs need to be able to command high prices. If you think this isn’t true and that the government could effectively fund drug development for major unmet needs, take a look at drug resistant infections/bacteria. It’s an enormous problem that is not being addressed, mainly because antibiotics are not profitable and thus there is no private investment in the field - so there is virtually no innovation. There is some price gouging in the pharma world, sure, but I always tell people that if you want to drastically cut drug prices across the board, you better pray that you never get a disease that we don’t currently have a cure for.
Yup. Unbridled capitalism is a scourge on our democracy, but suggest any solution that seeks to mitigate the negative externalities of libertarianism or winner-take-all capitalism, and the Fox News boomers and Ben Shapiro wannabe intellectuals scream you're a socialist.