BlackRock Future Forum: Healthcare Special 

The road to recovery 

Zach Buchwald: Welcome to the BlackRock Future Forum Healthcare Special. I'm Zach Buchwald, Head of BlackRock's Institutional Business for the U.S. and Canada, and it's my pleasure to welcome you here today. BlackRock created the Future Forum as a means for exploring the big topics that underpin investment decision-making and that impact all of our financial futures. We convene leaders who are in decision-making roles and we ask them to provide their expert viewpoints on the issues we face today as a society as well as the potential paths forward.

When we started the Future Forum in the spring of 2020, it was in the midst of extreme uncertainty, uncertainty in terms of public health and the future path of the disease, uncertainty in market performance, political uncertainty here in the United States. We were experiencing social unrest as well as a rapidly changing investment landscape. But with the start of 2021, we have genuinely reached an inflection point. We have a new administration here in the U.S., and there's hope for greater cooperation.

There continues to be strong economic support, and the markets have responded to that. And most importantly, we are in the early innings of the vaccine rollout, which is where a lot of our discussion will focus for the next hour. In the U.S., the Biden administration is on the record with a goal of vaccinating 300 million Americans by the end of the summer in order to reach herd immunity. We've got some big challenges ahead. First off, demand for the vaccine today dramatically outpaces supply. And unless other producers come online soon, it will be difficult to meet the summer timeline.

The retail rollout of the vaccine has been more successful in some states than others, and the prioritization of who gets access brings with it new ethical dilemmas. And we've all heard about patients traveling across the country for appointments. In fact, it's introduced a new term to the lexicon, vaccine tourism. Then there are reports that one in five adults do not plan to get the vaccine at all, or only if it's required by their employer. 

Today we're going to speak with leaders that bring informed perspectives on all of these challenges. Our first segment is called The Road to Recovery, and it will focus on the rapid development of the vaccine, the ongoing rollout, and what to expect as we advance toward a widespread vaccination. Then in the second segment, we'll translate these insights into actionable investment ideas from several BlackRock investors. 

Before we get started, I encourage you to get familiarize yourself with the tech interface that we're using. There's a place to ask questions, a place to chat with your fellow attendees. And periodically, you'll see a place to participate in real-time polls that provide insight into what your peers are thinking. I'll join you live in the chatroom to discuss the content and to analyze the polling results. Following the conference, we will package up the insights and share them with you. And you'll also be able to access replays of all of the sessions on this platform beginning one hour after the event.

Now without further ado, let me introduce Mark McCombe, BlackRock's Chief Client Officer, who will lead our first segment, The Road to Recovery. Welcome, everyone, to the BlackRock Future Forum. Over to you, Mark.

Mark McCombe: Thanks, Zach. Well, I'm very excited about the next part of our Healthcare Future Forum. Over the past week, I've had the pleasure of sitting down with three incredible CEOs who are right in the frontline of dealing with this pandemic. First and foremost, I'll be speaking with Dr. Albert Bourla. He's the CEO of Pfizer and has had a long and esteemed career at Pfizer and has been very much part of the discussions of getting the vaccine manufactured and distributed globally.

You'll hear from him about just how he ratcheted up the production and has been able to produce over a billion doses in such a short space of time. But of course, Pfizer is a massive pharmaceutical company. And so we'll hear about how he's deployed resource in order to meet this incredible challenge whilst also paying attention to the other businesses he has responsibility for. 

I'll then also talk to Dr. Tom Mihaljevic, and he's the CEO of the Cleveland Clinic, clearly a very important healthcare provider in this country and overseas. And we'll hear a lot from him about how he managed his resources and dealt with both the pandemic but also some of the other incredibly important work they do, particularly in the area of cancer treatment.

And then finally, just two weeks in the seat, but I'll be speaking to the CEO of CVS. That Karen Lynch. And CVS covers the whole of the United States with over 300,000 employees who've really been on the frontline at both delivering the vaccine to the long-term health -- to the long-term healthcare facilities, but then also now rolling it out into their pharmacies more broadly. And I think Karen's perspectives are really quite unique, both in terms of the work they did with the CDC, but then also how they thought about really distributing this vaccine to the places it's needed most.

So I hope you enjoy these three conversations. I absolutely did. And we're going to kick off with Dr. Bourla from Pfizer. 

Well, I'm thrilled to be joined by Dr. Bourla, Chairman and CEO of Pfizer. And certainly, on behalf of all of our guests who joined us today, I just wanted to extend a thank you to you and your teams. Obviously, vaccine development and vaccine rollout are normally things that go well under the radar for those of us in financial services. But clearly, the last 12 months with the pandemic have been something quite remarkable. And a lot of questions, I'm sure, on people's minds about the duration to get the vaccine out. What does herd immunity really mean? And maybe you can just start by painting a picture of what your last 12 months have been like and where do you think we are in this journey.

Dr. Bourla: Clearly, the last 12 months were quite fascinating. And also, they were very, very challenging. They were very challenging for us not only because of the COVID-19 efforts in terms of the vaccine, but also, we had to maintain production for critical, for people's lives' medicines. And we had to do that in the middle of [doubts] and the middle of the pandemic, and also by protecting also the health of our colleagues. And we were very successful in doing that.

But of course, the highlight, I would say, was, as everybody knows, the development of the vaccine. I think it was a very strong demonstration of the power of science and, allow me to say, the power of science in the hands of the private sector, but also in collaboration and the power of the collaboration with so many other stakeholders, industrial players, other industrial players, regulators, academia. And those were very successful.

So for me, the situation right now, to see that the vaccines are going out of the gates of our manufacturing sites and they are reaching the arms of people around the world.

Mark McCombe: Clearly, we're dealing with a global pandemic. But as you rightly allude to, the fact is that manufacturing and distribution is very driven from a national or even here a state perspective. So as a global organization, how have you sort of met that challenge, particularly with the profile obviously of this vaccine rollout and just the importance of it?

Dr. Bourla: The truth is that it has become a political minefield. And I'm happy that they're [still on our legs]. It has become now, since the early days of development of vaccines, because they were highly politicized. And that created a very strong challenge. I think the [unintelligible] for rolling out the vaccine, from our perspective, I'm very pleased to say that it was very, very successful. We had 99.9 percent accuracy in [ascending] our vaccines.

As you know, our vaccine is to be stored in minus 70 degrees. We have created a lot of innovation in the logistics that will allow that to become a nonissue. We had, I don't know, maybe five or six parcels of the thousands and thousands that have been shipped out that were recalled because we have a [zippy S] and a thermometer in every parcel. So we felt that the temperature in some of them actually went higher -- lower rather than higher.

But I would say that right now, we are sending virtually every place in the U.S. within the next day. By 10:30 in the morning when we receive an order today, by 10:30 in the morning tomorrow, the hospital or the clinic that we've been asked to ship the produce is having it. Now things are improving -- are improving in the U.S. dramatically right now, I would say. And they're improving also as a globally. So I believe the new Biden administration has issued a plan that our scientists found very comprehensive and very effective in terms of enhancing the ability of the United States to administer more vaccines into the arms of the people. And I believe things will go well.

In terms of production, I think we have a dramatic increase right now in our production capabilities. The states will start seeing them. I spoke with a lot of governors last week, and I explained that they should start seeing significant increases in their deliveries, at least from Pfizer vaccine. We will deliver [to] the U.S. government -- we will release 120 million doses by the end of March. We will -- that's 20 percent more than what was originally scheduled. 

We will deliver 200 million doses to the U.S. government by the end of May. And this is two months earlier than previously planned. And we are now in current discussions to deliver an additional 100 million doses, and we will disclose details once the agreement is finalized. So I think from production, we will see quite a bit. In terms of sending the vaccines to the places it needs to go, we are already operating almost at an excellent level.

And I think also the national effort to vaccinate is picking up very, very nicely. So we will see significant results in the next several months.

Mark McCombe: So as you look forward, and obviously after the enormous effort to get everyone vaccinated and create herd immunity, what does it mean for broader society? Does this become like an annual flu jab, or will it be something that in your opinion can create a kind of global herd immunity? And these new variants, what should we expect in terms of the vaccination protocols around that?

Dr. Bourla: I don't think that this is something that anyone can speak [of] with high certainty, this is going to be the scenario or not. But the truth is that there are more and more and more indications that this could end up becoming endemic like the flu situation. We know that immune responses from people that have been infected right now, they are dropping after several months. That's the first time now that we were able to see. We don't know about vaccinated people, but we know that people that have been naturally infected, they have been dropping.

So that indicates that if there is a similar situation with vaccines, there will be a need for a booster. We know that the new variants start emerging. This is something that is well known to epidemiologists. It's very clear that this situation will lead to the need either to [have] annual boosters of the same vaccine if the vaccine is effective against those variants, or the development of annual boosters that will be slightly modified so that they can cover the variants.

So it looks like more and more that that will be a situation, that people on a regular basis, they will have to get their shots, let's say, on a yearly basis. The good news is that, particularly with our technology, the mRNA technology, not only we have sterile results in terms of efficacy -- almost a perfect efficacy in the high 90s, but also, the technology has the ability to very quickly do things in weeks, for examples, that with other technology you need months.

Mark McCombe: Well, that's very reassuring to hear. Maybe I could pivot a little bit to this question again of sort of the distribution of the vaccine into countries that maybe haven't experienced the same degree of getting ahead of the ordering of the vaccine, so particularly countries in the developing world. How would you work with the different countries in the developing world in terms of getting the vaccine to perhaps the places where they haven't been able to thus far get the doses that they need?

Dr. Bourla: Yes. Let me verify that it was never a question of price because we always priced our vaccine into three tiers. We gave, let's say, a range of prices based on volumes that would be ordered for the developed world, the Europes, the U.S.s, the Japans, the Australias of the world, the Canadas. We gave a price for middle-income countries as they are characterized by UNICEF and WHO. And we gave at cost price for those that are low-income countries, of course.

And those [were reached] in basically every government in the world early enough, and we asked them to place orders based on these conditions. If we missed any, everyone knew where to find us. So we took all the calls. But what we are doing -- and we are very, very, very focused right now -- it is that we try to improve -- increase dramatically our production capabilities. Already, 1.3 billion doses for the year was a gigantic achievement. Already, we made clear that we were going to do 2 billion this year. 

And we are, I think, the only company, if I'm not mistaken, that has already signed an agreement with a [co-vax] facility for the low-income countries. And we are now trying to finalize that with UNICEF. So low-income countries also will receive through the co-vax facility doses, although they can receive their doses also with bilateral agreements.

Mark McCombe: These are quite incredible numbers when you think about it. And again, I think it speaks to the magnitude of the effort. Does the science basically stay the same as you look forward and think about the years to come and how we deal with this on an annual basis? For example, I mean, you talked about the cold storage and having two shots. Do you think that evolves to a situation where you don't have those constraints and, therefore, it becomes more efficient in terms of the delivery?

Dr. Bourla: Absolutely. I think we are working to improve the life -- the storage conditions of the current version of the vaccine, and soon we will be able to make some announcements on that. But also, we are working to develop new [forps] that will not require this ultra [cold chain]. Although as I said so far, it's not an issue right now. But it could become [unintelligible] if we move to individual type of vaccinations, not in the massive vaccinations. So we will have a friendly -- a storage-friendly version of this vaccine in the months to come.

In regard to the one dose or two dose, keep in mind that our vaccine, we believe, will need only one booster going forward. So the two doses are only in the beginning. If you have to repeat vaccinations next year, you will not have to give two doses. You will have to give only one dose. So the relative advantage of having one dose or two doses is really diminishing in the next year when most of the people are already having their first shot.

Mark McCombe: Well, one final question, Albert. Obviously, Pfizer does a lot of other things in its core business. And yet this has clearly been a massive focus for the company. As CEO, how have you sort of balanced the different demands within the company in terms of resource allocation? Obviously, you yourself and the team have had to work through the safety precautions with regards to COVID itself. So just some observations from the top of the house on how you've managed to pivot the company towards this incredibly important effort while maintaining your core businesses.

Dr. Bourla: Well, thank you. The -- already in 2016-17, I was running the innovative business of Pfizer. And I had come to the conclusion that to run this very big biopharma company, you need to break into smaller pieces and create autonomy to them. So I created the business units. The vaccines is one of them. So it's the vaccines business unit. But they are dealing only with vaccines, from early research to late research to commercial manufacturing.

But we have also the oncology business unit. We have the rare disease business unit. We have the internal medicine business unit. We have the hospital business unit, the immuno-inflammation business unit. So there are six business units here. But they are operating like independent bio-techs. And I see our role like a private [equity], like an investor, like BlackRock. 

And each of these six business units, they are coming to us, to the corporation, and they are competing for resources. And they are asking, "I want this resource to do that," and this is what they will deliver. [Unintelligible] process that we try to allocate the resources in the best possible way for the corporation. But once they're location -- these sources are allocated, each one is individual to run. 

During the pandemic, that helped a lot because, although my and the vaccines business unit's focus was so much lasered into the COVID-19 vaccine, the oncology will have their own resources, and they were dealing only with cancer. And the rare diseases, they were dealing only with their gene therapies and the other issues that they are trying to tackle. That helped a lot. 

Of course, the vaccines required significant resources. But the decision was done very early. First of all, that would be our Pfizer internal resources; we didn't receive help for multiple reasons from the government. But also, we said that that would be incremental. So I didn't take resources out of anybody else to do the vaccine. I just added resources at the expense of [EPS], basically. 

We increased the R&D expenses so that we would be able to do it. It was a bet that I think was well calculated. If we were failing, it was going to be painful, but it wouldn't break the company. But in case of success, that could dramatically change the trajectory of this company for years to come, not only in terms of reputation and in terms of saving the world, which is very clear [unintelligible], but also the financial [transactor] of the company, as this [unintelligible] vaccine is going to have significant [unintelligible]. 

But also, the platform itself is going to be very, very dynamic. And actually, the best -- the most rewarding thing for me -- and the demonstration why breaking the company business units, it is the right recipe to foster innovation, was the fact that the big, gigantic Pfizer was able to move faster than small bio-techs. Who would ever believe that that would be the case before? No one. But we've proven that it is.

Mark McCombe: Well, Albert, I think that when the history books are written on this pandemic, the role of the private sector and companies like Pfizer will be [written] large. And I think again I can only thank you for the time we spent together today. This has been so incredibly enlightening. I hope you and your family stay well and healthy, and we'll look forward to seeing you in person very soon.

Dr. Bourla: Thank you very much, Mark. Stay safe. Stay well. 

Mark McCombe: And now I'm really pleased to introduce our next guest, Dr. Tomislav Mihaljevic, who's the President and CEO of the Cleveland Clinic. He's very kindly allowed me to call him Tom throughout this conversation. So tom, welcome. Great to see you. How are you doing?

Dr. Mihaljevic: Yeah. Well, Mark, thank you very much for having me. Yes, we are doing well. We have been really working nonstop since the beginning of this pandemic. 

Mark McCombe: Well, thank you. And on behalf of all of our participants today in this conference, we'd just like to say thank you to you and all your team for all the incredible work that you've done. We feel very blessed to be in safe hands like yours and your colleagues' in managing through this. And maybe just to kick the conversation off, I wonder if you could turn the clock back to a year ago. If you were having a conversation with yourself back then, what would you say? What have been the biggest lessons learned over the past 12 months?

Dr. Mihaljevic: Well, there were quite a few, I'd have to say, Mark. Probably the most important and most obvious one is just the realization of the threat that the pandemic, with the new emerging pathogen, makes to the existence of humanity. And I think that threat of the pandemic that was unfortunately realized this past year was one of the biggest learnings that all of us collectively have had.

Here in healthcare, we have learned very many valuable lessons. First was the lesson of the importance of collaboration. This pandemic has really started the unprecedented tempo when it comes to the collaboration and exchange of knowledge and exchange of best practices, where we have learned from one another around the world to take as good care as we can of patients in need.

Internally, from my standpoint, from the organization like Cleveland Clinic with 70,000 caregivers, an important lesson was the lesson of frequent and transparent communication that keeps the organization together in crisis. And that frequent and transparent communication has to be linked with the values that the organization has. And just like in any crisis, we have to live our values.

So this is how Cleveland Clinic got through this crisis. We really adhered to our patient-centered model of care. We really adhered to our simple principle of taking care of one another as family and taking care of our patients as family members. And we took care of our organization as our home. So yes, this past year was certainly a challenging one. In very many ways, it was a rewarding one. It will be remembered, to some extent, by the pandemic, but I do believe that it is going to be remembered even more by the way that we reacted to the pandemic.

Mark McCombe: Now we've read a lot about the drop-off initially in elective procedures that had a significant impact on health systems like yours. Can you tell us a little bit about what've been the latest developments there, and particularly as we begin the rollout of the vaccination, what are you seeing in terms of pickup in the elective procedures again?

Dr. Mihaljevic: Yeah, this pandemic has had several waves. The first wave in March, April, and May of last year was characterized by hospitals -- most hospitals being really empty here in the United States, awaiting the big surge of patients that never materialized. And those empty hospitals, obviously, even when they're empty, need to be maintained. So we suffered tremendous financial losses in the first half of the year.

But even more importantly, very many patients had their care deferred. And we learned how difficult it is to reinvite patients back to their non-COVID care later on. What we're experiencing right now is a problem where we're seeing an opportunity to take care of patients more effectively and safely because we learned more about the disease, but what we are seeing is that very many of our patients are still fearful of coming back to hospital to seek care, and particularly if that care is not related to COVID because they're afraid they will contract the disease while being in the hospital.

So what we hope is going to happen over the next coming months is that ongoing efforts with vaccinations will reduce the number of hospitalizations and deaths. And the recent trends are very encouraging, and we hope that we will be able to resume the entirety of medical care that our communities and outpatients need. I am very concerned about the fact that so much care has been deferred for such a long time, and I'm concerned about the long-term effects of the deferment of care.

Mark McCombe: Well, so let's turn to the future now and talk about exactly that point. First and foremost, let's talk about the rollout of the vaccine. What role are you playing in the distribution, and then perhaps even more importantly, in terms of reassuring the public that actually the vaccine is the right way to go and that we get the herd immunity that we need to be able to open up the economy again more proactively? So let's talk first about that, and then I'd love to talk about the future of healthcare because there's so much I think to unpack there.

Dr. Mihaljevic: Yeah. When it comes to vaccines, there are different practices in different countries. In the United Kingdom, for example, the vaccine distribution is solely in the hands of NHS, of National Health System. Here in the United States, our governments decided, both the Federal and state governments, to distribute the vaccines through pharmacies and through public departments of health or state departments of health. And we as healthcare providers actually have distributed a minority of vaccines to date in the United States. We certainly hope that this will change as more vaccines become available.

When it comes to vaccines, they are effective. There are a number of those who are approved, a number of those who will most likely be approved in the future. Moderna and Pfizer are two vaccines that are approved for use in the United States, and they're highly effective. For anyone who is listening and watching in right now, if there is an opportunity for anyone to get a vaccine, please get vaccinated. 

Two upcoming vaccines are J&J, Johnson & Johnson vaccine, and the Novavax. Both of those vaccines are holding also a phenomenal promise. And the next one in line is most likely going to be AstraZeneca vaccine that was approved in Oxford but yet needs to be approved here in the United States. The simple rule of thumb is that every vaccine that is available is better than no vaccine. The rapidity with which we vaccinate our population is going to be of tremendous importance. That is our only chance to successfully fight against this disease.

Mark McCombe: As you look at the organization that you have responsibility for, are there any sort of national differences that you've seen emerging? Clearly, we're dealing with a global pandemic, but how some of the national governments and distribution authorities have tackled this problem seems to be very different. You mentioned Britain getting ahead with their vaccination program, whereas parts of Europe I think still lag behind. And obviously, in the developing world, we worry about the ability to get the vaccines out to the majority of that population. Any observations from your seat that you could share with the audience?

Dr. Mihaljevic: The countries where we have a presence, [there's a] markedly different approach to the treatment of the COVID pandemic. In the United Arab Emirates, Cleveland Clinic Abu Dhabi has been in function for the last six years. And I have to say, the UAE has done a remarkably good job in protecting their citizens and securing a very large dose of vaccines that have been distributed very effectively. And I think that they have done through that a very, very good job in keeping their community safe. 

In the United Kingdom, the challenge was obviously different. Unfortunately, the United Kingdom has suffered through many, many losses during this COVID-19 pandemic. But I'm very glad to see that our vaccination efforts are progressing at a fast pace. In the United States, we have used so many vaccines. We have actually used more vaccines than the remainder of the world together. But we still have a long way to go. And there are some regional differences, obviously, here from one state to another.

But when it comes to the overall trends in the world, I am optimistic, yet I'm cautiously optimistic because the developing countries are suffering from the lack of vaccines. We will not -- we, meaning the global population -- we will not be able to control this disease until we control this disease in every corner of the world. 

And if there is a singular lesson of this pandemic, it's that pandemics do not respect borders. They do not respect socioeconomic classes. And there is not a single community in the world that can stay healthy until every member of that community has an availability of medical care and can stay healthy through it. And people have to get access to medical care. In this case, they have to get an access to the vaccine.

If we fail to realize the importance of the distribution of the vaccines throughout the world, we will be battling the emerging strains of COVID-19 for a very, very long time.

Mark McCombe: Mm. Well, I think those are very wise words. At the beginning of this conversation, I asked you to have a conversation with yourself from a year ago. I wonder if I could ask you to have a conversation with yourself in, let's say, three years' time. What do you think has changed permanently as a result of this pandemic, and what are some of the emerging trends that perhaps the pandemic accelerated, particularly in the field of telemedicine?

Dr. Mihaljevic: The world after COVID-19 pandemic will not return to the pre-COVID-19 world. I just do not see that happening, not within a timeframe that you mentioned, three to five years. We will permanently -- we will, at least for the foreseeable future, will continue to live to some extent the way that we are living right now, wearing the masks, being aware of social distancing, and being highly, highly aware of the risks of contracting the virus.

So that is going to be probably here to stay for quite some time. Are there reasons for optimism? Absolutely. I do believe that we've learned a lot during this past year. We've learned a lot about the actual importance of collaboration when it comes to healthcare. We have learned a lot about the importance of healthcare as an industry. We have learned a lot about how exchange of information and global collaboration is essential. It's essential for the existence of our planet. 

For all the reasons that we've mentioned in this conversation, we have to work closely together. And what I am particularly optimistic [about], that we are finally starting to use the tools of the 21st century to combat this pandemic. We're using the new data, the new science, the new research, new methodology, everything from artificial intelligence to mRNA technologies, to create better and faster cures.

So I am very, very optimistic about the opportunity to combat these types of illnesses in the future.

Mark McCombe: Dr. Mihaljevic, thank you once again for your insights today. It's been quite an incredible conversation, and I feel very optimistic that the health of this country and beyond is definitely in safe hands. Thank you for the time, and thank you once again for all the work that you and your colleagues have done, not just in the past 12 months but over all the years of the Cleveland Clinic's existence. So thank you.

Dr. Mihaljevic: Thank you very much, Mark. Thank you very much for having me. Stay safe. 

Mark McCombe: Well, now it's a great pleasure to introduce Karen Lynch. Karen, newly minted CEO of CVS in the first two weeks of her job. And we're really thrilled that you would take the time today to come and talk to us all. So Karen, how's it going, and how are the first couple of weeks been in the new job?

Karen Lynch:  Oh, so Mark, it's really nice to see you and a delight to meet you. While it's -- you're right, it's been two weeks, and I managed to have my first earnings call. We had very strong results. We're starting 2021 with very strong momentum. And really, Mark, what I'm focusing my time and energy [on] right now is ensuring the health and safety of our employees and making sure that we're playing a critical role in the vaccination administration. And I know that's what we're here to talk about.

Mark McCombe: Absolutely. Let's dive straight in. I mean, it's been incredible to watch the past 12 months. And obviously, we're thankful for all of the work on the frontline that you and your teams have been doing. We're now clearly at a critical phase. And I've had the pleasure to talk to Dr. Bourla from Pfizer about obviously the manufacturing and ramping up the manufacturing of the vaccine. And he obviously has indicated a real critical role that companies like CVS are going to play.

So give us a little bit of a sense of the journey of how CVS got involved, and where are we today as we really ramp up this distribution effort?

Karen Lynch: Well, Mark, we've been working on vaccines administration and logistics for a number of months now. Been working very closely with the manufacturers, as you mentioned. Been working very closely with the White House. We were selected for the first phase to administer vaccines to long-term care facilities across the United States. And we were selected by 47,000 long-term care facilities. And we started that effort at the end of December and will complete that effort in mid-March.

We started with the skilled nursing facilities. We've completed 98 percent of the second doses at this point. So we expect to be complete by next week, so the third week in February, as planned an on time.  

And then relative to the assisted living facilities, we will complete that effort in mid-March, again on time.

And the way it all worked was, you know, it was an interesting process because the states had to activate the long-term care facilities' administration. So once the state activated, then we were in a position to go into those long-term care facilities.

And it was an interesting experience for our pharmacy techs and our pharmacists and our nurses. They sometimes would often go to bed to administer a vaccine. So you can imagine, you know, we needed to have logistical precision as we were thinking about, how do we get those vaccines in the arms of our most vulnerable population?

I think the good news now, Mark, is what we're seeing is we're seeing the infection rates down in long-term care facilities, deaths are down in long-term facilities, hospitalizations are down. So we are quite pleased with the progress that we've made and the part that we played in this amazing public health effort.

You know, phase 2, and we've been working very closely again with the Biden administration is the federal pharmacy program. And we are now a partner in the federal pharmacy program. We're getting about 250,000 doses a week. And we opened up 11 states and 350 of our CVS locations in those 11 states. As you might imagine, supply is the critical part of them getting shots in arms, and we're hoping for more supply. And as we get more supply, we'll open up more of our CVS locations.

So we're excited to be an integral part of changing the dynamics of this pandemic and hopefully eradicating it.

Mark McCombe: Yeah. I think you've put a lot of texture around the images that we see, and I think their sort of hero status that so many of your colleagues have, as you say, going bed to bed. It's just been so critical.

But you still have a considerable operation to run across the pharmacies and healthcare and so forth. How did you think about the resource allocation when it came to such a massive ramp-up of getting the vaccine into people's arms?

Karen Lynch: We have a pharmacist. We have pharmacy techs and we have nurses across the whole entire company. So we are leveraging all of those resources. And we hired people as well. So now we have over 90,000 clinicians that are ready and able to put shots in arms. So it was a big resource allocation. Not only are we using our talent -- and I'm quite proud of our talent, they've done such a great job -- we're using technology to help with logistics, too, so that we're using digital connections so that our pharmacists can stay connected to our distribution centers, to the CVS locations.

And what's interesting, what's been an interesting part about this is just the refrigeration and thinking about the logistics around the refrigeration and staying connected. So not only has it been a big resource allocation, but it’s also been logistically important for us to be precise at how we think about getting those vaccinations in the arms of individuals. And the teams are doing exceptionally well.

Mark McCombe: That's great. Thank you. And you touched a little bit earlier on, on obviously in the midst of all this, we've had a change in administration, which I'm sure adds a certain degree of complexity to the process that was already underway. And I know you guys were tapped up very early on by the CDC to be part of the discussions on how to actually effectuate this incredible sort of wartime effort.

Any insights for a company like yours as to the seat at the table that you had and just some of the factors that influence decision-making within CVS as to actually how to play a part in the distribution?

Karen Lynch: Yeah, we've been partners with the CDC and with the administration all along the way. And we've been giving -- sharing insights, sharing our experiences, talking about technology. You know, one of the areas that we are currently focused on, Mark, is just vaccine hesitancy and getting vaccines into the arms of the most vulnerable population, and also the black and brown community. There's a fair amount of hesitancy in the black and brown community. 

We're working very closely with the administration to make sure that we're putting stores where their social vulnerability indexes are high, and so that we're in the communities where those individuals are comfortable with their pharmacists and with their pharmacy tech, and working very closely to educate and help them understand the importance of the vaccine, the efficacy of the vaccine. And we're partnering with local community individuals as well.

This is an important part for us to make sure that we get herd immunity, that all Americans get vaccinated. And we want to make sure that those that may be in disadvantaged communities get the access that they need.

The other thing, Mark, that we're doing, not only being in the communities, but we’re also doing specific outreach. And we're outreaching to those individuals and those communities, setting up appointments for them. And we're also working with community leaders, and we have a 1-800 call number for them to call in to us, and then we'll schedule the appointments as well.

So we're excited about the tactical approaches that we're taking as well as the strategic approaches that we have underway.

Mark McCombe: You know, you've touched on the question I was going to ask about vaccine hesitancy and the questions around safety.

I think unfortunately the media and the Internet does love to focus on questions of safety and hesitancy. But, I mean, having now experienced a couple of months of the rollout, do you think public opinion is shifting, that we're actually winning the battle? Because, as you rightly say, if we don't get herd immunity, then this endures much longer than it needs to.

Karen Lynch: Yeah, we are seeing public opinion shift. You know, as people have had their first and second doses, there's been some side effects, but not major ones. And I think as more people see and hear from family and friends, and more importantly, opinion leaders, we have seen some of that shift. 

We're not where we need to be, though. We need to continue to educate people. We need to continue to get involvement from our community leaders. And, you know, we need to help people understand the efficacy of this vaccine.

You know, Mark, the other thing that I wanted to mention, I mentioned it before relative to technology, one of the things that we've done at CVS is we have built digital capabilities for people when they schedule their appointment so that we schedule the first dose and the second dose at the same time. 

And that's the critical part of making sure we do achieve this herd immunity because a lot of times we've seen people not getting that second vaccine. We see it with the shingles vaccine. So we are really focused on making sure that we schedule that appointment, that second one, and we follow up using our digital capabilities to make sure that people will come back and get that second dose.

That is a unique attribute that we have that not a lot of places have. You know, when you have the mass vaccination centers, they're not necessarily scheduling that second dose. And, you know, I think it's critically important for us to really make sure that we all have that first and second dose.

Mark McCombe: Well, you allow me to sort of pivot to kind of life going forward after we get through this initial vaccination period. What do you think are some of the lessons that we will learn from this pandemic? And what will change kind of permanently in how we deliver healthcare in this country?

Karen Lynch: You know, Mark, it's an interesting point. And you're right, we have seen consumer behavior change dramatically throughout this pandemic. We've seen consumers engage through digital health and virtual health. We've seen more demand for personalized and simple experiences. We've seen more of a demand for in-home services.

But we've also seen the importance of having an in-community place for delivery of care. And nothing has demonstrated that more than having a place for testing, a place for vaccines.

So as we think about the future of health, we have to think about health being delivered where and when people want to have their healthcare, so it's not one-dimensional. It needs to be multidimensional. We need to have health services that are in the home, in the community and digitally connected. And then we need to make sure  that those experiences are seamlessly connected through technology so that you're carrying around your health information wherever you go.

But this pandemic has really put consumers making more of their decisions around health at the forefront more than it ever has before. And I think that's critically important. And as a company, we're very focused on that. And I'm very focused on that as I think about where I take this company in the future.

Mark McCombe: I think those are very wise words. Any observations from you just as to kind of the evolution of CVS and the role that you've played in kind of some of the questions about social and racial equity in the country? And then obviously the future of healthcare and how you see that playing out.

Karen Lynch: We made a big commitment, $600 million commitment to address social injustice in this country. And we're proud of the commitments that we're making around this.

And you said it. We really want people to make sure that they have healthier lives and longer lives and have the ability to afford their lives. And one of the things that we're doing, we've been very focused on affordable housing, and we've made big investments in affordable housing so give people the opportunity to live in communities. 

And we're also very focused, Mark, on social determinants of health. And obviously housing plays a critical role in that, and also people have -- if they have housing, they'll take better care of their health. They're not going to take care of their health if they're not working and they're not have a good place to stay. So we're incredibly focused on that as well.

Mark McCombe: On behalf of everyone who's joined to watch this broadcast, thank you. And we're certainly all routing for you and looking forward to getting that shot in the arm at our CVS when the time is right.

Karen, thank you so much. Have a great day.

Karen Lynch:     You, too.

Zach Buchwald: Thank you, Mark. And thank you to our guests for sharing their insights here at the BlackRock Future Forum.

Now, we've all experienced enormous challenges over the past year. But we can also pause and recognize that the progress that's been made in fighting the pandemic has been astonishing. Today we can all find reasons to be optimistic, whether that optimism comes from the speed of the vaccine development or from the innovations that Dr. [Borla] described as vaccine volumes increase, and constraints like cold storage might be eliminated soon.

Many of us are also now seeing family and friends receive the vaccine. My family had a moment of great comfort last week, when my parents drove up to the Cleveland Clinic in Vero Beach and received their second dose of the Pfizer vaccine.

And so let me also thank Dr. Bourla and Dr. Mahaljevic for helping my family to stay safe.

Okay. We're going to move now to our next segment. We've asked four of BlackRock's leading healthcare experts to talk to us about what's driving the sector and to provide some of their investment insights. 

I am delighted to open the session with Anne Marie Schultz, head of BlackRock's healthcare practice here in the U.S. Anne Marie is our foremost expert in how hospital systems invest their portfolios to support their long-term missions. Anne Marie, welcome to the Future Forum.

Anne Marie Schultz:      Thanks for having me, Zach.

Zach Buchwald: Good to see you. Listen, I'd like to start with a level set on how the hospital networks are managing right now. We all see the COVID numbers go up and down, and we worry about hospitals having the capacity to treat the people that need their help from COVID and everything else.

So please tell us, how are they holding up?

Anne Marie Schultz: Zach, thank you. It's been humbling to hear our healthcare clients talk about how the pandemic has affected their people and their processes. 

Frontline workers have been dealing with both the physical risk as well as the emotional toll of the pandemic. And strategies like shifting resources across hot spots or importing contract help just simply aren't as effective anymore with cases so widespread.

We've all heard about how PPE shortages have affected organizations, and it's really driven across as well as mandated for views of supply chains.

And then, lastly, we've had utilization drop, not only from cancellation of elective procedures, but folks just concerned about coming in for healthcare.

It's also been inspiring, though, to hear how hospitals have adapted. They have very quickly instituted strategies like telehealth services, in-home monitoring, creating field hospitals, and creating facilities that are either COVID or non-COVID so that we have safe healthcare settings.

Zach Buchwald: As you mentioned, there's also been a reduction in elective procedures and just sort of regular-way health visits.

And now I see these as the twin challenges to the economic health of the hospitals. You know, my question for you is, At what point does the model break down? Is there real danger to the stability of the system?

Anne Marie Schultz:  Zach, there have absolutely been challenges. [Kaufman Hall] estimates that the gross operating revenue of hospitals for 2020 declined by about 3 percent. Now, I know that doesn't sound like much, but hospitals run on razor-thin operating margins. So when you layer on the cost impacts of staffing and PPE, it means that many hospitals have extreme declines in operating margins. In fact, Kaufman Hall estimates the operating margins came in by as much as 50 percent to just eke out positive results.

Now, that's without the benefit of the massive stimulus that came into these organizations. So you can imagine how important a lifeline that was for so many hospitals.

Operating results are going to continue to be challenged. That's going to start to pressure economics, it's going to start to pressure metrics like debt service coverage ratios and may start to weigh on ultimately credit ratings and the cost to raise capital in debt markets.

Zach Buchwald: Let's spend a minute talking about the investment portfolios that are there to support the hospital systems. And you work primarily with the stewards of healthcare capital. You know, their day job, we understand, is to manage the investment portfolios, but the role really is to help the hospital systems deliver on their mission.

So two questions here:  First is, How have these portfolios evolved over the last year? And the second question is sort of, What should the future of these portfolios look like to balance the immediate challenges that we have today from COVID with the long-term missions of these organizations to serve public health?

Anne Marie Schultz:  Zach, liquidity was the top priority of 2020. Between uncertain operating results, CARES Act funding, Medicare Advantage repayments, and debt issuance, there was a tremendous amount of cash infusion. And all that cash needed to get managed at the same time that rates were incredibly low. So for the year, a lot of systems ended up with elevated cash levels.

But I'll contrast that with the [long-term] flows, which are designed to support the mission of the organizations. Their objectives are balance sheet growth as well as sustaining purchasing power.

The good news is most systems did not need to tap into those long-term pools as a result of the operating pressure, which would have been like borrowing from the future to pay for today.

In fact, coming out of the initial shock, many organizations were able to resume their pre-pandemic risk appetite and investment strategies. But now they had to do so in an environment where interest rates are incredibly low. 

So I expect to see, particularly on the growth side of portfolios, at least three changes coming into play. The first is on fixed income, just maximizing the tool kit of fixed income strategies that will allow it to do its job: to preserve capital; to diversify equity; and enhance carry.

We also expect very distinct allocations to assets in growth markets like China to tap into opportunities outside the US.

And, lastly, we expect diversification of inflation sources like not only the public markets, but private market real assets.

And then the last point I'll leave you with, Zach, is that healthcare organizations have been on the frontlines of issues like healthcare inequity and the social determinants of healthcare outcomes. Every CIO I've talked to over the last several months has talked about board-level conversations and down about how to strike a balance between their investments having some sort of impact while still trying to achieve their return objectives.

Zach Buchwald: Anne Marie, thank you. Those were great insights. And thank you for contextualizing that within the broader world that we're all living in.

We're going to shift now to the public markets. And I'm pleased to be joined by Dr. Erin Xie, the head of our health sciences investing unit within BlackRock's active equity group.

Erin brings a Ph.D. in biochemistry, and MBA, as well as 20-plus years of investing in the healthcare industry. Folks, there's no better authority in this sector.

Erin, welcome back to the Future Forum.

Erin Xie: Thank you, Zach. I'm so happy to be here.

Zach Buchwald: Now, Erin, you've seen a number of changes and innovation sin healthcare throughout your career. But 2020 is surely the year of the biggest change. How has the healthcare sector evolved as it responds to the pandemic?

Erin Xie: Right. So I think COVID also is a catalyst for innovation. You know, on one hand, there's like a huge capital in-flow in healthcare as a result of COVID. Healthcare got a lot of attention. If we look at the private investment in healthcare last year,  I think the global healthcare private investment in healthcare stood at $80 billion. And probably market also was very vibrant if we think about [unintelligible] in public, the funding was -- I think it was about $130 billion last year, more than double the prior year.

And this capital in-flow is really, I think, funding a lot of innovation. Not everything will work out. There will definitely be some failures. But I think there will be some real winners coming out.

Zach Buchwald: Now, let's talk about investing for a few minutes. How do you think about the opportunity set today for investment in the sector? What are you most excited about?

Erin Xie: Oh, that's my favorite topic. I think healthcare is actually at a very exciting stage. We all know the long-term structural drivers, right? The aging demographics and emerging market healthcare spending, but very importantly, I think we're just seeing very strong innovation across healthcare industries.

For example, in biopharma space, there's really tremendous innovation in cancer, in autoimmune diseases, in genetic diseases. And I think, as a field, we're really benefitting from, I think, 20 years of genomics research. And there's just a much deeper understanding of human biology. I mean, these days cancer therapy can really look for cancer more specifically versus historically. You use the chemotherapy that kills the cancer cells, but unfortunately also kill the healthy cells. 

And there's a very just innovative approach. For example, antibody drug conjugates technology that you use antibody and then tack [along] a chemotherapy with it and go look for cancer cells specifically and does the killing.

I think in that tack, we're also seeing very strong innovation. For example, minimum invasive technology to enhance the surgery experience for patients as well as physicians. The robotics getting more prevalent uses, even though were still early in the adoption. But meanwhile, I think when we think about digital technology's role in healthcare, I think we're still very early in its penetration. When people think about digital health, we tend to think about virtual care telehealth. 

But it actually has a much broader role in healthcare. For example, in many medical equipment, they incorporate digital technology, so even hospital beds these days have smart function that can help communicate better between patients and caregivers.

And all of this, I think, makes healthcare just a very exciting space to be in and also translating into attractive investment opportunities.

Zach Buchwald: The market certainly agrees with you on that. It's really responded to the opportunities ahead in healthcare. And I want to ask you, What's your take on the valuations that we're seeing in this sector?

Erin Xie: If we look at healthcare valuation, the aggregate is actually quite attractive. I think as a sector, relative to broader market, it actually sits at a historical low. 

I will say within healthcare, the valuation spread is actually quite meaningful. The large cap is quite cheap. Some companies, I think they are probably cheap for a reason when long-term fundamental prospect is in question. But there are opportunities in large cap that I think valuation does not really capture future potential.

I think small cap valuation has come up quite a bit, but it's a big collection of companies. We can still find individual opportunities that have the promising future. Meanwhile, our valuation's still reasonable from the individual stock perspective.

Zach Buchwald: Last question:  Let's step back for just a minute, Erin. Think about how we're really in a period of transition right now -- new leadership in the US as well as potentially a new regulatory environment. 

How do you think about this backdrop as it relates to the healthcare sector? Any worries here?

Erin Xie: I actually think the policy environment is quite benign. If we look at the Senate make-up, it's just extremely hard to get enough votes for major legislative changes. So I think any change will be incremental and will be relatively small in scale.

I will also say I've been believing this for quite some time, I think policy is a topic that people tend to talk a lot about [unintelligible] healthcare. My experience has been it tends to be a lot of thunders, but not much rain at the end.

Zach Buchwald: Thank you, Erin. Privileged to have you with us today, and congratulations again on the remarkable performance.

Erin Xie: Thank you, Zach.

Zach Buchwald: I'm delighted to introduce our next guest, Belinda Boa, who is BlackRock's head of active investments for Asia Pacific, as well as CIO of emerging markets in our fundamental active equity business.

Belinda, welcome to the BlackRock Future Forum.

Belinda Boa:  Thanks, Zach. Thanks for having me.

Zach Buchwald: It's great to see you. First off, Belinda, we talk about Asia Pacific as a region, but, in fact, the countries within Asia have had very different experiences the past year.

Which countries have basically recovered and which ones are still struggling?

Belinda Boa:  Well, you know, it's fascinating, Zach, because this time last year, the expectation was that many poor and middle-income countries were going to be devastated by COVID. And actually while we've seen how the coronavirus has progressed in the economies, and it has been painful, I would say it's been significantly less painful than what we would have expected.

And I think there's sort of two observations I'd make. First of all, there has been an exceptionally effective track-and-trace system that has been implemented in many countries in this part of the world. China, in particular, started with a track-and-trace system. Taiwan has had something like 250-plus consecutive days of zero cases. And then if you look at countries like Australia and New Zealand that did have small waves of COVID outbreak, they've managed to contain the virus through both track-and-trace and effectively closing their borders.

Then on the other hand, there have been countries like India, Indonesia, Brazil in the emerging markets complex that have seen huge infection rates. India is the second-highest infection rate in the world. And while that's been very devastating to watch, what I think's been fascinating is that the mortality rates in emerging markets in general have been significantly less than developed markets.

So, you know, between March and September last year, it's estimated that developed markets mortality rates were fourfold what we were seeing in emerging markets.

Zach Buchwald: What would you say to investors who see Asia, and specifically China, as an important opportunity for growth, but they're concerned about the next phase of the pandemic?

Belinda Boa: Well, as I said, there are many markets here that have actually managed to contain the virus despite small waves that we've seen more recently.

Let's take China, for example, because now this is one of the only major economy in the world to have actually grown in 2020, posted positive GDP growth last month. And so while I do think we're going to see a little bit of a speed bump in Q1 because there has been some smaller outbreaks going into the Chinese New Year, which is a very important time for both travel and for consumption. So we do expect to see a small speed bump. It's clear that they have been able to very successfully contain it.

We're also seeing that when you look at earnings numbers. Earnings in Asia last year were very resilient, down 1 percent. Our expectations for 2021 is that this year we should see earnings in the low 20 percent, which just shows the growth that we're exposed to in this part of the world. And we expect that that's going to continue in 2022, numbers more in the high teens.

And then the other thing that I think just underpins some of this growth that we're seeing due to the effectiveness of which the economies here have been able to contain the virus, is we're seeing a significant amount of capital market activity, which is [unintelligible] into the region. And that, for investors, is very exciting.

Zach Buchwald: Okay, now I'd like to ask you to get a little bit narrower and spend a minute on where you see investment opportunities in the year ahead. Countries, sectors, thematic opportunities, where are you positive?

Belinda Boa:  Well, 2020 was interesting because, like developed markets, it was very concentrated just in a number of key sectors. And, actually, the breadth of market was very low for us in our opportunity set.

So now we roll into 2021. That's sort of continued at the beginning of this year, but we're expecting this to change. We're positioning ourselves for more of a recovery story through the global economy to start reopening. And so, therefore, we've moved the portfolio into more of cyclical trades. We've overweight financials. We like areas in leisure, which have clearly been underperforming last year, but we expect will benefit from this reopening. We also like countries like India and Indonesia. These are [carry] countries that will benefit from a global restart.

And then I think on the growth sectors which have dominated markets, we still believe that there are opportunities. But I'd caution that you need to be selective because some of these areas -- in technology, in healthcare, and in consumer, even -- are looking very frothy when it comes to valuations.

But the longer term seems around a rising middle class. So we know that we're going to have two-thirds of middle-class consumers that are going to reside in this part of the world. The focus on China on domestic consumption, that provides us with enormous opportunities in consumer.

Then, secondly, some of the themes that we've seen around technology going into coronavirus, that's going to continue. The way people consume, the way services are provided, and the technology solutions that we're going to see, we have lots of opportunities in this part of the world around technology.

And then, finally, sustainability, not often associated with APAC, but we've seen very large countries not commit to sustainability goals. And we see opportunities, whether it's electronic vehicles, renewable energy, but also in terms of healthcare solutions that we shouldn't underestimate when it comes to the future opportunity.

So no shortage of opportunities and, Zach, we think a different market, a broader market, but there still remain opportunities in some of the sectors which dominated in 2020.

Zach Buchwald: Belinda, thank you so much for staying up so late to join us today. Those were great insights.

Belinda Boa: Thanks, Zach. Thanks for having me.

Zach Buchwald: Now, finally, I am delighted to be joined by Lynn Baranski, who's the global head of investments for BlackRock private equity partners. 

Lynn, welcome to the Future Forum.

Lynn Baranski: It's great to be here. Thank you, Zach.

Zach Buchwald: So good to see you. Lynn, tell us about the impact that the pandemic has had on healthcare private equity. Like what are the big themes driving demand for private capital today/

Lynn Baranski: So, Zach, healthcare's been a really interesting space over the last year. We've seen increased activity in private equity across the board from venture capital to growth equity to buyout.

But we've also seen some of the negative impacts of COVID in the healthcare space as well. We're seeing opportunities across geographies from the US to Europe to Asia. The companies we see in high demand are providing solutions to the expensive and complex ecosystem that exists between the payer, the providers, and the patient.

The healthcare subsectors in focus include healthcare providers, biopharma, and medtech. And, finally. some of the themes we see are focused on technology, consumerism, Medicare Advantage, value-based care, and supply chain resiliency.

Zach Buchwald: Let's talk more about technology, consumerism, supply chain, and resilience. How are you expressing those themes in the portfolios that you manage? And can you give us an example of an opportunity that you see that gets you very excited?

Lynn Baranski: Absolutely. One of the themes that we've been investing behind in Asia and the United States since COVID began is contract drug development and manufacturing services.  These companies really provide the plumbing or the infrastructure necessary to get new drugs to market. They're conducting research, they're manufacturing, and they're packaging multiple therapeutics and vaccines that are being used to treat COVID-19 patients today.

What we like about these companies is that they benefit from the growth trends around drug innovation and drug volumes, while taking limited drug-specific risk.

Zach Buchwald: Now, let’s hear about the flipside. What are some of the risks and the challenges that are on your radar screen?

Lynn Baranski: There are a lot of challenges in the healthcare space. And it's a sector where you have to stay current.

So we're watching the vaccine timeline closely, regulation that might come with the Biden administration, drug pricing the Amazon pharmacy, reimbursement rates and valuations, just to name a few.

But as it relates to the pandemic, there has been a significant drop in acute care and elective surgery volumes. This creates headwinds for the many healthcare providers and medical device companies, as well as the payers that have revenue linked to volumes.

Another area that we are watching closely is government reimbursement rates. The CMS, which, as you know, sets government reimbursement rates, has implemented programs to encourage the transition toward value-based care. This transition will continue to push more risk to the healthcare providers.

A third area that we're watching closely is valuations. Private equity investors have bid up valuations for many of these healthcare assets as they've come to recognize the industry's growth potential and appreciate the recession resiliency.

In this environment, it's especially important to be conscious of valuations when we're looking at assets and what we're going to pay for them.

Zach Buchwald: All right, Lynn, before we go, I want to narrow in one particular theme that you've mentioned, and it came up with Anne Marie, and it came up with Erin as well. And that's technology.

We're all experiencing big changes in how technology is used in the healthcare industry, the increase in telehealth, contactless delivery of pharmacy products as well as everything else. 

How is this going to evolve in the post-COVID world?

Lynn Baranski: Yeah, you're right, Zach. Technology is being applied to all segments of the healthcare sector. Clearly, telemedicine and remote patient monitoring has seen huge increases in use and gained widespread acceptance due to COVID-19. The adoption of telemedicine has probably been accelerated by three or four years. And the US government has removed some of the key regulatory hurdles to encourage its use. So it's here to stay.

Beyond telehealth, we see great opportunity to invest behind other technologies that will improve healthcare overall, such as tech-enabled solutions to manage clinical trials, the application of software solutions and data analytics to remove unnecessary costs from the system, the application of AI to life sciences and biotech will drive better drug discovery, better diagnosis, better disease identification, and more personalized medicine. And hopefully all of these technologies and applications should deliver and I hope they deliver more accessible, more affordable, and better healthcare to people around the world.

Zach Buchwald: All right, Lynn, thank you for ending on such a high note. That was great.

With that, the BlackRock Future Forum comes to a close. Before we end, I'd like to thank our guests for sharing their time and insights with us today. 

As Dr. Mahaljevic said, the post-COVID world will not be the same as the pre-COVID world. But COVID has brought not only disruption; it's also brought rapid innovations across sectors and a great evolution in healthcare delivery. Along with those innovations have come new investment opportunities within healthcare and beyond as global economies emerge from the pandemic.

At BlackRock, we remain optimistic for the future.

Thank you for joining us today and stay well. Zach Buchwald signing off.

DISCLOSURES

Capital at risk. All financial investments involve an element of risk. Therefore, the value of the investment and the income from it will vary and the initial investment amount cannot be guaranteed.

The material is for information purposes only. It is not intended for and should not be distributed to, or relied upon by, members of the public. 

It is not intended to be a forecast, research or investment advice, and is not a recommendation, or an offer or solicitation to buy or sell any securities or to adopt any investment strategy. The opinions expressed are subject to change. References to specific securities, asset classes and financial markets are for illustrative purposes only and are not intended to be and should not be interpreted as recommendations. Reliance upon information in this material is at the sole risk and discretion of the reader. The material was prepared without regard to specific objectives, financial situation or needs of any investor.

Past performance is not a reliable indicator of current or future results.

Zach Buchwald/Erin Xie Interview: Statistics referenced from CB Insights, January 2021; Credit Suisse Industry Primer, January 2021.

Zach Buchwald opening remarks: KFF, January 2021.

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In Mexico, for institutional investors and financial intermediaries only. Investing involves risk, including possible loss of principal. This material is provided for educational and informational purposes only and does not constitute an offer or solicitation to sell or a solicitation of an offer to buy any shares of any fund or security. It is your responsibility to inform yourself of, and to observe, all applicable laws and regulations of Mexico. If any funds, securities or investment strategies are mentioned or inferred in this material, such funds, securities or strategies have not been registered with the National Banking and Securities Commission (Comisión Nacional Bancaria y de Valores, the “CNBV”) and thus, may not be publicly offered in Mexico. The CNBV has not confirmed the accuracy of any information contained herein. The provision of investment management and investment advisory services is a regulated activity in Mexico, subject to strict rules, and performed under the supervision of the CNBV. BlackRock Mexico, S.A. de C.V., Asesor en Inversiones Independiente (“BLKMX”) is a Mexican subsidiary of BlackRock, Inc., registered with the CNBV as an independent investment advisor under registration number 30088-001-(14085)-20/04/17, and as such, authorized to provide Investment Advisory Services. BlackRock México Operadora, S.A. de C.V., Sociedad Operadora de Fondos de Inversión (“BlackRock MX Operadora” and together with BLKMX, “BlackRock México”) are Mexican subsidiaries of BlackRock, Inc., authorized by the CNBV. For more information on the investment services offered by BlackRock Mexico, please review our Investment Services Guide available in www.BlackRock.com/mx. This material represents an assessment at a specific time and its information should not be relied upon by you as research or investment advice regarding the funds, any security or investment strategy in particular. Reliance upon information in this material is at your sole discretion. BlackRock México is not authorized to receive deposits, carry out intermediation activities, or act as a broker dealer, or bank in Mexico. For more information on BlackRock México, please visit: www.BlackRock.com/mx. Further, BlackRock receives revenue in the form of advisory fees for our mutual funds and exchange traded funds and management fees for our collective investment trusts. 

 In Peru, this material is for­­­ the sole use of Institutional Investors, as such term is defined by the Superintendencia de Banca, Seguros y AFP.

Superintendence of the Republic of Panama. The information contained herein does not describe any product that is supervised or regulated by the National Banking and Insurance Commission (CNBS) in Honduras.  Therefore, any investment described herein is done at the investor’s own risk. This is an individual and private offer which is made in Costa Rica upon reliance on an exemption from registration before the General Superintendence of Securities (“SUGEVAL”), pursuant to articles 7 and 8 of the Regulations on the Public Offering of Securities (“Reglamento sobre Oferta Pública de Valores”).  This information is confidential, and is not to be reproduced or distributed to third parties as this is NOT a public offering of securities in Costa Rica. The product being offered is not intended for the Costa Rican public or market and neither is registered or will be registered before the SUGEVAL, nor can be traded in the secondary market. If any recipient of this documentation receives this document in El Salvador, such recipient acknowledges that the same has been delivered upon his request and instructions, and on a private placement basis.

For investors in the Caribbean, any funds mentioned or inferred in this material have not been registered under the provisions of the Investment Funds Act of 2003 of the Bahamas, nor have they been registered with the securities regulators of Bermuda, Dominica, the Cayman Islands, the British Virgin Islands, Trinidad & Tobago or any jurisdiction in the Eastern Caribbean, and thus, may not be publicly offered in any such jurisdiction. The shares of any fund mentioned herein may only be marketed in Bermuda by or on behalf of the fund or fund manager only in compliance with the provision of the Investment Business Act 2003 of Bermuda and the Companies Act of 1981. Engaging in marketing, offering or selling any fund from within the Cayman Islands to persons or entities in the Cayman Islands may be deemed carrying on business in the Cayman Islands. As a non-Cayman Islands person, BlackRock may not carry on or engage in any trade or business unless it properly registers and obtains a license for such activities in accordance with the applicable Cayman Islands law.

In Uruguay, the Securities are not and will not be registered with the Central Bank of Uruguay. The Securities are not and will not be offered publicly in or from Uruguay and are not and will not be traded on any Uruguayan stock exchange. This offer has not been and will not be announced to the public and offering materials will not be made available to the general public except in circumstances which do not constitute a public offering of securities in Uruguay, in compliance with the requirements of the Uruguayan Securities Market Law (Law Nº 18.627 and Decree 322/011).

This material is for distribution to Professional Clients (as defined by the Financial Conduct Authority or MiFID Rules) only and should not be relied upon by any other persons.

Until 31 December 2020, issued by BlackRock Investment Management (UK) Limited, authorised and regulated by the Financial Conduct Authority. Registered office: 12 Throgmorton Avenue, London, EC2N 2DL. Tel: + 44 (0)20 7743 3000. Registered in England and Wales No. 02020394. For your protection telephone calls are usually recorded. Please refer to the Financial Conduct Authority website for a list of authorised activities conducted by BlackRock. 

From 1 January 2021, in the event the United Kingdom and the European Union do not enter into an arrangement which permits United Kingdom firms to offer and provide financial services into the European Economic Area, the issuer of this material is: (i) BlackRock Investment Management (UK) Limited for all outside of the European Economic Area; and (ii) BlackRock (Netherlands) B.V. for in the European Economic Area.

BlackRock (Netherlands) B.V. is authorised and regulated by the Netherlands Authority for the Financial Markets. Registered office Amstelplein 1, 1096 HA, Amsterdam, Tel: 020 – 549 5200, Tel: 31-20-549-5200. Trade Register No. 17068311 For your protection telephone calls are usually recorded.

For qualified investors in Switzerland: This document is marketing material. This document shall be exclusively made available to, and directed at, qualified investors as defined in the Swiss Collective Investment Schemes Act of 23 June 2006, as amended.

In DIFC: This information is for Professional Clients as defined under the Dubai Financial Services Authority (“DFSA”) Conduct of Business (COB) Rules only. It does not constitute and should not be construed as an offer of, invitation or proposal to make an offer for, recommendation to apply for or an opinion or guidance on a financial product, service and/or strategy. Whilst great care has been taken to ensure that the information contained in this document is accurate, no responsibility can be accepted for any errors, mistakes or omissions or for any action taken in reliance thereon. You may only reproduce, circulate and use this document (or any part of it) with the consent of BlackRock. 

In South Africa: Please be advised that BlackRock Investment Management (UK) Limited is an authorised Financial Services provider with the South African Financial Services Board, FSP No. 43288.

In the Kingdom of Saudi Arabia this information is only directed to Exempt Persons, Authorized Persons or Investment Institutions, as defined in the relevant implementing regulations issued by the Capital Markets Authority (CMA).

In the United Arab Emirates this material is only intended for -natural Qualified Investor as defined by the Securities and Commodities Authority (SCA) Chairman Decision No. 3/R.M. of 2017 concerning Promoting and Introducing Regulations. Neither the DFSA or any other authority or regulator located in the GCC or MENA region has approved this information. 

For investors in Israel: BlackRock Investment Management (UK) Limited is not licensed under Israel’s Regulation of Investment Advice, Investment Marketing and Portfolio Management Law, 5755-1995 (the “Advice Law”), nor does it carry insurance thereunder. 

 The information provided here is neither tax nor legal advice and should not be relied on as such. Investment involves risk including possible loss of principal.

FOR INSTITUTIONAL, FINANCIAL PROFESSIONAL, PERMITTED CLIENT AND WHOLESALE INVESTOR USE ONLY. THIS MATERIAL IS NOT TO BE REPRODUCED OR DISTRIBUTED TO PERSONS OTHER THAN THE RECIPIENT.

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