The latest Market Talks covering the Health Care sector. Published exclusively on Dow Jones Newswires at 4:20 ET, 12:20 ET and 16:50 ET.

0130 GMT - Raffles Medical Group's 1H results should be supported by rising patient numbers at its China hospitals, say UOB Kay Hian analysts in a note. Raffles Medical is expected to report higher contributions from the Shanghai and Chongqing hospitals for 1H as Chinese operations expand, they say. Enrollment of the Shanghai hospital under China's national health insurance program also started in 1H. The analysts are bullish on the group's expansion in China and Vietnam and potential acquisitions in the medium to long term. That said, higher manpower costs and stiff competition from regional peers could drag the group's margins. The brokerage maintains its buy rating and raises its target to S$1.18 from S$1.06. Shares are last at S$1.02. (megan.cheah@wsj.com)

1530 GMT - Merck isn't likely to face any competing offers to its $10 billion deal to buy Verona Pharma, analysts at Truist say. In a note, Truist says the $107 per share takeover of Verona is a pleasant surprise. The analysts say they and investors they had spoken with believe the more than 400% increase in Verona's valuation during the past 12 months has pushed the company across the affordability threshold for many potential acquirers. With the deal's 23% takeout premium, Truist says it does not expect to see the emergence of another bid for Verona. Verona shares climbs 21% to $104.80, and Merck is up 2.5% to $83.37. (colin.kellaher@wsj.com)

1344 GMT - RxSight's new guidance comes with greater conservatism but its path forward has less visibility, Oppenheimer's Steven Lichtman says in a research note. The ophthalmic medical-device company on Tuesday guided for a decline in 2Q revenue and lowered its full-year revenue guidance. Lichtman says the updated guidance and stock reaction suggest a depressed 1x EV/sales multiple. "However, visibility has now been meaningfully reduced, particularly with new system demand well below expectations and as RxSight's new initiatives don't seem to us to be quick fixes," says the analyst, prompting a downgrade to perform from outperform and removal of the prior $28 price target. Shares dive 46% to $6.90. (denny.jacob@wsj.com; @pennedbyden)

1344 GMT -- RxSight gets a downgrade from Wells Fargo after what it described as another disappointing quarter. The ophthalmic medical device company on Tuesday guided for a decline in 2Q revenue and lowered its full-year revenue guidance. "While we still view the technology favorably, we misjudge the structural issues facing RxSight, and based on the guidance update, we are now uncertain about future performance," the analysts say. Wells Fargo sets a rating of equal weight and price target of $9 compared to a prior rating of $25 and price target of $25. Shares are 49% lower at $6.46 in premarket trading. (denny.jacob@wsj.com; @pennedbyden)

1340 GMT - Merck's $10 billion acquisition of Verona Pharma doesn't change the drugmaker's capital-allocation priorities. Merck says it has the flexibility to fund the Verona deal through a combination of cash on had, commercial paper and new debt. It also says it still significant capacity within its strong investment-grade credit rating to pursue more deals. Merck says it remains committed to growing its dividend over time and that it still expects stock buybacks this year at a similar level to 2024. Merck up 3% to $83.70. (colin.kellaher@wsj.com)

1331 GMT - Merck is in a strong financial position, Finance Chief Caroline Litchfield says on a call with investors, noting that the company will continue to pursue acquisitions following its $10 billion deal for Verona Pharma. The Verona deal, expected to close in 4Q, will be financed through a combination of cash on hand, commercial paper and new debt issuance, Litchfield adds. Merck projects the transaction will ding adjusted EPS by approximately 16 cents in the first year, hurt by costs associated with the transaction, partially offset by sales of its newly acquired drug Ohtuvayre. Litchfield notes that the deal hasn't changed Merck's capital allocation strategy, as the company will continue to invest in its portfolio and pipeline, grow its dividend and repurchase shares, and pursue acquisitions. (connor.hart@wsj.com)

1326 GMT - Merck's $10 billion deal for Verona Pharma will help position the company to successfully navigate the 2028 loss of patent exclusivity for its blockbuster cancer drug Keytruda, CEO Rob Davis says on a call with investors. "We're now well on our way toward transitioning to a portfolio with a far more diversified set of future growth drivers," he adds. Moving forward, Davis says Merck will remain highly focused on delivering innovative medicines and vaccines that address important unmet needs, a move he believes will help sustain success over the long term. "We recognize there is more to do and remain committed to advancing our internal pipeline and supplementing it with additional science-led external innovation," he says. (connor.hart@wsj.com)

1315 GMT - RxSight's latest update leaves more questions than answers, JPMorgan analysts say in a research note. The ophthalmic medical-device company on Tuesday guided for a 2Q revenue decline and lowered full-year revenue guidance. The analysts note a few factors for the shortfall, including softness in cataract volumes and increased competition in the premium intraocular lens space. "It's difficult to underwrite the outlook beyond 2H25 even as the revised guidance sets a hopeful floor to grow off of," say the analysts. "We're reiterating our underweight rating as a result and expect RxSight to remain in the penalty box as it aims to both showcase stability in 2H25 and the ability to return to growth in 2026+." Shares dive 49% to $6.50 in premarket trading. (denny.jacob@wsj.com; @pennedbyden)

1312 GMT -- RxSight is likely in the penalty box over the near-term following Tuesday's results and guidance, but Needham analysts maintain their buy rating. The ophthalmic medical device company on Tuesday guided for a decline in 2Q revenue and lowered its full-year revenue guidance. "We believe the new guidance bakes in areas of conservatism," say the analysts. "Further, we believe expansion of its U.S. commercial pivot and recent OUS launches could become areas of growth over the next 12-18 months." They also believe the valuation gap between RxSight and two of its peers could close over time, making the risk/reward over the next 12 months to skew positive, leading to their maintained rating. Shares dive 49% to $6.50 in premarket trading. (denny.jacob@wsj.com; @pennedbyden)

1250 GMT - Merck's $10 billion deal to buy Verona Pharma is consistent with its business-development strategy and based on the compelling science behind Ohtuvayre, CEO Rob Davis says. "We've tracked Verona's progress for a number of years, including the success they've had both clinically and now commercially," he says on a call with analysts. Davis notes that the addition of Ohtuvayre--Verona's treatment for chronic obstructive pulmonary disease--will strengthen and complement Merck's cardiopulmonary portfolio, as well as address an area of significant unmet medical need. "We're impressed by what they've achieved to date and are very happy to bring this team to Merck and to help enable the realization of their vision," he says. (connor.hart@wsj.com)

1248 GMT - The market for chronic obstructive pulmonary disease therapies is large and growing, says Jannie Oosthuizen, Merck's U.S. president of human health. It currently represents approximately $17 billion annually, and it is projected to grow to approximately $27 billion annually by 2032, Oosthuizen adds. "We believe that with increased promotional support and education of physicians and patients, Ohtuvayre has the potential to become a multibillion-dollar therapy into the mid-2030s," he says. (connor.hart@wsj.com)

1248 GMT - Raymond James says WELL Health Technologies' organic growth is showing signs of strength at a time when the company is pursuing acquisitions aggressively. Analyst Michael Freeman says in a report that he sees the digital healthcare company's "capacity expansion across its Canadian clinic base through workflow streamlining and new physician recruitment as a strong leading indicator of organic growth." Freeman believes that coupled with aggressive M&A plans it "portends an increasingly attractive growth profile for the overall Canadian business." The Canadian focus may get an even bigger boost, thanks to its "strategy to ultimately divest all US-based assets and redeploy proceeds toward its high-returning Canadian clinic opportunity," Freeman says. (adriano.marchese@wsj.com)

(END) Dow Jones Newswires

July 10, 2025 04:20 ET (08:20 GMT)

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