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E-Articles - Are You Taking Too Much Risk With Your Investments?
One of the most common situations we come across month in month out, is a new client in their 50's coming to us with a collection of policies, often worth considerable amounts of money.
In some cases, our office table groans
In some cases, our office table groans
According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product
under the weight of various policy documents (only kidding but I'm sure you get the point) amassed over many years. What is extremely worrying is that in virtually every case, here is a client approaching retirement who is tak
; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.
Examples of combination products may in
Examples of combination products may in
ng far too much risk with their investments!
What is more, they have no idea that this is the case at all.
They may say something like "I was told by the adviser who sold it to me that it was safe because it is in a managed/
What is more, they have no idea that this is the case at all.
They may say something like "I was told by the adviser who sold it to me that it was safe because it is in a managed/
lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.
iversified/with profits fund". Having then put the document in a drawer, it does not see the light of day again until the client feels that he/she should see "how it's doing".
Now, we are all human, and so we accept the fact
Now, we are all human, and so we accept the fact
here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe
hat they don't know what they don't know, just as a dentist telling us about a problem with our teeth we did not know we had until our regular check up.
However, since this is a continuing huge issue that has the potential to
However, since this is a continuing huge issue that has the potential to
d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.
Combination pro
Combination pro
ruin a dentist's/doctor's retirement plans, let's look at a recent case as an example.
Mrs Jones (name changed) has not seen her adviser for many years and decided to approach us having been to one of our talks and having re
Mrs Jones (name changed) has not seen her adviser for many years and decided to approach us having been to one of our talks and having re
ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc
eived the newsletter for sometime.
She has various PEPs, ISAs and Pensions worth ?200,000. Aged 54, she plans to semi retire at 55 and fully reire at 60. Working only 2 days a week from age 55 to 60, she has lots of places to
She has various PEPs, ISAs and Pensions worth ?200,000. Aged 54, she plans to semi retire at 55 and fully reire at 60. Working only 2 days a week from age 55 to 60, she has lots of places to
easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi
visit in mind, and this pot of money will help her achieve this.
Readers of this newsletter will (hopefully) know about the term Asset Allocation. Basically, this is the percentage that you have in equities/property/bonds/cas
Readers of this newsletter will (hopefully) know about the term Asset Allocation. Basically, this is the percentage that you have in equities/property/bonds/cas
nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically
, and is absolutely vital to get right.
Very simply this is because you need to be comfortable with the amount of volatility inherent in every portfolio. If markets dive, will you panic as you see your portfolio value plummet
Very simply this is because you need to be comfortable with the amount of volatility inherent in every portfolio. If markets dive, will you panic as you see your portfolio value plummet
and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ
just when you need it?
Secondly, since we build cash flow forecasts for clients, which compare their goals to their assets, the idea is you can have a portfolio designed to achieve your goals with the MINIMUM amount of risk.
Secondly, since we build cash flow forecasts for clients, which compare their goals to their assets, the idea is you can have a portfolio designed to achieve your goals with the MINIMUM amount of risk.
ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi
Mrs Jones duly filled in her risk questionnaire and expenditure template, and we built her cash flow forecast. It turns out that to achieve her goals the amount of exposure she requires to growth assets (more risky) is 40% of
ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.
Following aspects would a
Following aspects would a
her portfolio. She is shocked to find that currently her exposure to growth assets is 98%!
So what would this mean in the real world for Mrs Jones?
One of the most volatile investment periods in modern history occurred in 19
So what would this mean in the real world for Mrs Jones?
One of the most volatile investment periods in modern history occurred in 19
dd to the challenges in developing combination products:
Which markets to tap where the combination products can do fairly well?
Which combination prod
Which markets to tap where the combination products can do fairly well?
Which combination prod
3/74. If this were to happen again, then her ?200,000 on New Years Day in 1973 would be worth approximately ?62,000 by New Years Eve 1974. Even after the market bounced back in 1975, showing huge gains, ?200,000 would still ha
cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
ve dropped to ?155,000 by New Years Eve 1975.
However, if Mrs Jones were in a proper risk assessed portfolio with a disciplined approach to rebalancing (#) and a 40% exposure to growth assets, the drop over two years would be
However, if Mrs Jones were in a proper risk assessed portfolio with a disciplined approach to rebalancing (#) and a 40% exposure to growth assets, the drop over two years would be
tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
to around ?163,000, and at the end of 1975 it would stand at ?271,000.
That is a staggering ?116,000 more. More importantly, it means peace of mind for Mrs Jones, who is secure in the knowledge that she has minimised her risk
That is a staggering ?116,000 more. More importantly, it means peace of mind for Mrs Jones, who is secure in the knowledge that she has minimised her risk
t?
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
and can simply get on with arranging her holiday of a lifetime to Australia.
The Financial Tips Bottom Line
If you are within 10 years of retirement, get a check up before it's too late! Even though you may have experienced
The Financial Tips Bottom Line
If you are within 10 years of retirement, get a check up before it's too late! Even though you may have experienced
ping new procedures for reviewing their safety, efficacy and quality.
Professional from academic institutions, pharmaceutical industries, health care indust
Professional from academic institutions, pharmaceutical industries, health care indust
good returns from the recent rise in world markets, don't make the mistake of thinking that shares may not fall in value as well.
# Please note the figures used presume Mrs Jones would rebalance her portfolio at reviews held
# Please note the figures used presume Mrs Jones would rebalance her portfolio at reviews held
y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products
on 31st December 1973 and 1974. Rebalacing is an extremely important investment discipline normally
done annually, whereby if Mrs Jones is happy to have an exposure to growth stocks of 40%, and these stocks fall heavily in v
.
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
lue meaning they represent say 22% of her portfolio, she then sells other assets in her portfolio to take this back to 40%. In this case of course it meant buying equities at a low price, and seeing these stocks then rise in v
elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.
Companies that provide selfless information through particip
Companies that provide selfless information through particip
lue in 1975.
ACTION POINT
Check exactly what investments you have. What percentage is in equities and property?
If (say) it is more than 80%, you could have too much exposure than either you need, or for your comfort levels
ACTION POINT
Check exactly what investments you have. What percentage is in equities and property?
If (say) it is more than 80%, you could have too much exposure than either you need, or for your comfort levels
tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products
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