Healthcare Industry Report

This report analyzes the US healthcare industry, focusing on its economic impact and investment prospects. It highlights the industry's structure, including pharmaceuticals, biotechnology, and medical equipment sectors. The report presents data on gross output, R&D spending, and dividend yields of major players like Zoetis Inc. A decline in NIH research budgets is noted, yet the report suggests potential for future growth and investment returns, recommending Zoetis Inc. as a prudent investment option. The report uses data from Statista and SelectUSA, along with financial data from Bloomberg, Market Watch, Thomson Reuters, and Yahoo Finance.

The health care industry also known as medical industry is the hub of sectors in the
economic system that offers products and services for the betterment of health of individuals.
The industry aims to cure patients with preventive, palliative, curative and rehabilitative care.
It is inclusive of the commercialization and creation of products and services in order to
maintain and establish a healthy economy. Total spending on medicines in US is 450bn USD
and gross output of previous five year is as follows: (U.S. Pharmaceutical Industry - Statistics
& Facts, 2017).
Figure 1: Gross output of previous five year
(Source: U.S. Pharmaceutical Industry - Statistics & Facts, 2017)
The new healthcare industry is split into many divisions and relies on interdisciplinary teams
of experts and paraprofessionals to experience and satisfy needs of people regarding health.
The US is said to be the international head in per capital treatment drug spending that
represents 30 to 40 percent of the international market. Most of the worldwide
pharmaceutical firms have existence in the United States (The Biopharmaceutical Industry in
the United States, 2017). Study shows that biopharmaceutical sector accounts for 17% of all
domestic R&D funded and provided contribution of $1.2 trillion in economic output in 2014,
which was 3.8 percent of total output of U.S. and this has been increasing till date. Major
players of this industry are Zogenix Inc., Zoetis Inc and Vivus Inc.financial performance of
these companies can be noticed through following figure:

Table 1: Dividend yield by health care sector of USA
Health Care Equipment & Services Pharmaceuticals, Biotechnology & Life
Sciences:
Medical
Equipment’s
(0.88% dividend
yield)
Biotechnology (0.13% dividend
yield)
Medical
Supplies
(0.68% dividend
yield)
Pharmaceuticals 3.52% dividend
yield)
Health Care
Providers
(0.25% dividend
yield)
Figure 2: Financial glance of top plays of health care sector in USA
(Source: Bloomberg, Market Watch, Thomson Reuters and Yahoo Finance)
From the full year 2003 to the full year 2015, the budget of NIH for the research has
declined by 22%. In the full year 2016, Congress increased their commitment towards these
areas to some extent, adding extra 5.9%, many experts reported that there is a requirement of
more resources. Thus there is scope of prospected growth in industry and consequently they
will be able to deliver good returns. Further by considering financial glance it is prudent to
make investment in Zoetis Inc.

REFERENCES
U.S. Pharmaceutical Industry - Statistics & Facts. (2017). Retrieved from <
https://www.statista.com/topics/1719/pharmaceutical-industry/>.
The Biopharmaceutical Industry in the United States. (2017). Retrieved from
<https://www.selectusa.gov/pharmaceutical-and-biotech-industries-united-states >.