Opportunities in the Health Care Sector


Teresa McRoberts : There's the companies we know about and then there's the companies we don't know about. I have investments in some of the companies that are in the news a lot of that being involved in this. And then there's other companies where I certainly don't know. J&J was one a few weeks ago where they told us all that they are investing, that they're working on a vaccine. I wasn't aware of that until then. I think what we're going to hear as earning season comes along, I think we're going to hear about more and more companies discuss and disclose what efforts they have. I know there's going to be other health care companies, other pharmaceutical and biotech companies, that are going to discover that they too have an effort in something. I don't think it's one thing we need. If you look back at the history of AIDS, which is a virus, the very first products we had for AIDS were extremely crude. We'd probably look at them and cringe now and say, oh, they barely worked. That's true. They did barely work. But they were the foundation and the products kept getting better and better and better. And now HIV is no longer a death sentence. People live for years with HIV because we have such good products. I realize coronavirus is different in that regard. I think we need a variety of things. We need antivirals to give maybe somebody who's early in it and it's easier for an antiviral to deal with the virus before it's everywhere in your body. If you're just got a low viral level, it's a lot easier for an antiviral to tackle that viral load. We need products that treat all the various consequences that come from this disease. And there's dozens of things that we still don't know what all we need. It is not a drug. It is multiple drugs. It'd be great if there's an antiviral you can give somebody early on, but there comes a point where there's too much virus and you have to deal with the consequences of that. I think we're talking multiple drugs and I also think we could be talking multiple vaccines. And we just don’t know, we're going to have to see where the data leads us. Right now directly, I probably have about 10% of my portfolio in companies that you could say are directly trying to address COVID, but I know that there's other companies I own that over the next month or so as we

can get into earnings, they're going to talk about on their earnings call what their efforts are because every major company is going to be asked about it and I'm sure we're going to find there's a lot of companies. And that's great because we need as many shots on goal as we can to try to come up with as many things as we can have as quickly as possible. Speaker Question : I didn't get the percentage that you were allocated towards health providers and services. What were the percentages again? Also, you’ve mentioned that some of the elective surgeries aren’t being performed? Teresa McRoberts : In services, health providers and services is about 10%, health care equipment and supplies and what I call tools, that's about 30%. I do own some companies that are going to be affected by the halting of elective procedures over the next few months. These procedures will come back. I certainly cut some of those names back, but we will go back to having elective procedures. And I also own a few companies in the space where I don't think we're going to see much effect at all. And in fact are sadly a beneficiary of long, intense hospital stays. There's not a lot of those companies, but there are a few of them that will benefit. But even a company who sells a hip or a knee, at some point those procedures will come back and the stocks have gone down quite a bit. A lot of bad news has gotten priced into them. Specifically elective procedures, it's probably somewhere around 10% or 15% now because part of the rest of its stuff that is actually not as effective. If you think of something like I was talking about a diabetes sensor, a continuous glucose sensor that you put on your body, that's within a medtech and tools area, but it's not going to be affected by procedures. It's something that you use as an outpatient. You get a prescription for it; you get your refills of your sensors every month.

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