Simon turned a page in the documents he was holding and gently nuzzled his face against Janet's head as she leaned closer. He said, "The structure of the healthcare industry isn't as rigid as sectors like energy or telecommunications. Human society is always facing new diseases, and the pace of change in this industry is much faster. No medical giant can maintain dominance with just a few drugs or technologies forever. That's where our opportunity lies."
Janet, nodding as she enjoyed Simon's affectionate gesture, wasn't particularly interested in the subject. Managing Cersei Capital for Simon already kept her plenty busy, and she had no desire to take on more. Still, she asked, playing along, "So, how do you plan to approach it?"
Simon, feeling Janet snuggle closer, wrapped an arm around her waist. "I've come up with a few ideas after going through these documents. But I realized that some of these approaches would clash with my conscience. They really test the boundaries of morality."
Janet, far from concerned, looked intrigued. "Tell me one."
Simon said, "For example, we could acquire companies that produce orphan drugs—medications for rare diseases that have a small market demand—or buy the patents for such drugs. Then we could monopolize that market and raise the prices by ten thousand times."
Janet blinked, unfamiliar with the term "orphan drugs," but based on the description of a small market, she quickly understood. With her sharp mind, she pieced together the logic behind it. If they could really do that, the profits would be outrageous.
As she thought about it, Janet could sense the lack of enthusiasm in Simon's voice, which carried a touch of sarcasm. She reached out and gently stroked his face. "I imagine governments wouldn't allow that to happen, right?"
Simon turned and kissed her palm. "Maybe not in the past, but in the future? Who knows?"
"Hm?"
"This ties into the trend of consolidation in the healthcare industry," Simon explained. Seeing Janet's curiosity, despite knowing she wasn't too interested, he smiled and continued. "From what I've been reading, the U.S. healthcare industry is starting to consolidate, just like the media industry did. Right now, there are dozens of pharmaceutical companies in the U.S., but in the future, there will probably only be a few giants left. These powerful pharmaceutical companies, with their influence over the government and their monopolistic control over resources, will be able to easily implement the plan I just mentioned."
The consolidation of pharmaceutical giants was a trend Simon had observed while researching the U.S. healthcare industry. Combining this with the knowledge from his memories, the trajectory became even clearer.
Just like in his memory, Pfizer, which later became the world's largest pharmaceutical conglomerate, was not yet the dominant player in the U.S. healthcare market. It wasn't until a series of major mergers in the 1990s that Pfizer secured its market position.
There was also an interesting tidbit.
Pfizer's turning point was around 1997 when they launched the now-world-famous blue pill, Viagra. This little blue pill, sold at an astonishing rate of hundreds of units per minute, was like a shot of adrenaline for Pfizer.
Simon's appearance as a disruptive force had changed many things, but some events remained the same—like the release schedule of Viagra and the rise of the new tech wave.
The tech boom of the 1990s wasn't just about the internet. It also included fields like genetic science and biopharmaceuticals, which caused the market values of pharmaceutical companies to soar by the late 1990s.
Now, with Simon having accelerated the rise of the internet industry, the current tech wave was almost entirely centered on the internet. Investment in genetics and biotech had only started to pick up in the past year, as excess funds from the internet boom sought new outlets. Over the next few years, these fields would likely become part of the tech wave, further boosting the market values of pharmaceutical giants.
Simon chose this moment to enter the U.S. healthcare industry because it was the early stage of both the market's value explosion and its large-scale consolidation. Entering now was akin to buying in at the bottom.
Take Pfizer, for example.
Pfizer's current market value hovered around $27 billion. But Simon remembered that during the peak of the internet bubble, Pfizer's market cap had surged past $200 billion. While this was partly due to mergers, buying Pfizer stock now, even if the tech bubble burst in a few years, would still yield significant profits as long as the consolidation trend in healthcare continued.
Under the porch of the Tasmanian estate, Janet, leaning against Simon's chest, thought for a moment after he finished speaking. "Darling, if you think it's... too distasteful, we don't have to get involved."
"Of course not," Simon quickly refused, lowering his head to kiss her lips. "You know I'm not the kind to let myself be exploited. If these are the rules of the game and this is the trend, then I need to secure the best position for us."
Janet, ever agreeable, responded playfully, "Mm-hmm."
She looked up at him with a lovestruck expression.
Simon chuckled and pinched her smooth cheek. "Alright, enough talk about dull topics. What do you want for dinner?"
Janet's interest piqued immediately. "The weather's so nice today, maybe we could have a barbecue outdoors later?"
Simon stood up, lifting her easily. "Let's go prepare. It'll be more fun if we set it up ourselves."
After spending the weekend in Tasmania, the family returned to Melbourne for a few more days before heading back to North America on January 15.
Following much deliberation, Simon wasted no time in starting the Westeros system's entry into the U.S. healthcare industry.
The first step was the simplest—buying stocks.
After discussing with James Rebold, who managed the Westeros Company's finances and was also Janet's father, they decided to invest the nearly $2 billion in cash generated from selling shares of Danelys Entertainment into buying stock in major U.S. pharmaceutical giants like Pfizer.
In addition, BlackRock, a subsidiary of Cersei Capital, would also quietly enter the market.
They followed the usual 4.9% strategy.
By acquiring just under 5% of the stocks of companies like Pfizer, they avoided the need for disclosure and maintained the option to liquidate whenever necessary.
At the same time, Apollo Management would form a team dedicated to pharmaceutical mergers and acquisitions, and they would launch a fund specifically aimed at profiting from the coming wave of healthcare consolidation.
Additionally, the Westeros family's lobbying team would begin closely monitoring any healthcare-related policies in Washington.
Multiple strategies moved forward in parallel.
Simon's plan was for the Westeros system to secure a significant foothold and substantial influence within the U.S. healthcare system over the next five years.
This was the strategy Simon ultimately settled on.
After reviewing numerous industry-insider reports during his time in Australia, Simon realized that in the healthcare industry, it was wisest for the Westeros system to operate behind the scenes. After all, to the average person, the healthcare industry was full of morally questionable practices.
Like the orphan drug monopoly strategy.
What Simon had described to Janet during their time in Australia was a practice that, according to his memories, had become widespread among U.S. pharmaceutical giants later on.
As a result, many drugs for rare diseases saw their prices skyrocket from just a few dollars per box to thousands or even tens of thousands of dollars within just a few years.
Before the 1990s, such practices were impossible.
Back then, there were still many large pharmaceutical companies in the U.S., and competition was fierce. After the Orphan Drug Act of 1983, most of the major pharmaceutical companies didn't pay much attention to this field, leaving it to smaller firms trying to take a shortcut.
When these startups developed drugs for rare diseases, factors like bargaining power, government regulation, and even moral considerations kept the prices low when the products first hit the market.
But after the 1990s, once the healthcare industry had consolidated and giants like Pfizer emerged, they began acquiring orphan drug companies and patents. Using their industry clout, they raised the prices by hundreds or even thousands of times.
Unlike small companies, these pharmaceutical giants had strong bargaining power, monopolistic control, and significant influence over government policies. They could raise prices without fear, even arguing that excessive government regulation would stifle innovation in rare disease treatments, thereby pushing lawmakers to relax price controls.
Thus, what had once been an affordable market for orphan drugs quickly became dominated by outrageously expensive treatments. Under the control of pharmaceutical giants, the market entry barriers were raised significantly, and they even lobbied the U.S. government to make the approval process for orphan drugs more stringent. What had once been a flourishing field soon became a private preserve for the industry's major players.
Many patients, unable to afford the exorbitant prices, later filed lawsuits against the pharmaceutical giants, but most of these suits ended in failure.
As Simon planned the Westeros system's entry into the healthcare industry, he couldn't help but think of a quote from Karl Marx's Capital.
"Capital comes into the world dripping from head to toe, from every pore, with blood and dirt."
But Simon wasn't deterred by the industry's "distasteful" nature, as Janet had put it.
In a world where the weak are prey to the strong, refusing to seize easy opportunities would only result in becoming weaker over time.
Besides these larger moves, Simon also made some smaller strategic investments based on the information he had gathered during his time in Australia.
For example, he took interest in a company in San Francisco called Gilead.
Founded in 1987, Gilead had accomplished very little by early 199
6. However, based on the current situation and his memories, Simon could piece together the trajectory of this company, which would later be dubbed the "Apple of the pharmaceutical industry."
The key to Gilead's success was one person: Donald Rumsfeld.
Rumsfeld, who served twice as U.S. Secretary of Defense (in 1975 and again in 2001), was currently a board member at Gilead.
In Simon's memory, Rumsfeld would become Gilead's chairman in 1997. Then, after leaving in 2001 to become Secretary of Defense under George W. Bush, Gilead would begin its meteoric rise, becoming the pharmaceutical giant known for its hepatitis C treatments.
To an outsider, these connections might suggest only one thing: political favoritism.
But how exactly the pieces fit together would remain a mystery to most people.
Simon, however, knew the details.
Gilead's most crucial leap forward wasn't its acquisition of a company that developed a treatment for hepatitis C. It was the fact that Gilead succeeded in getting this treatment covered by the U.S. healthcare system at a premium price.
Anyone familiar with Gilead's hepatitis C drugs would know that the cost of a single treatment course was nearly $80,000, with some medications selling for as much as $1,000 per pill. Such exorbitant prices were far beyond what the average American could afford.
Under normal circumstances, Gilead would have been limited to a small, wealthy market if it maintained such high prices.
But, surprisingly, Gilead managed to get its expensive hepatitis C drugs included in the U.S. healthcare system.
As a result, the $80,000-per-treatment price was largely covered by the U.S. government and insurance companies, while ordinary Americans with health insurance paid very little out of pocket.
On the surface, it seemed like a win for patients, but where did the government and insurance companies get their money?
Certainly not from thin air.
What seemed beneficial to patients was actually a major factor in the skyrocketing costs of healthcare in the U.S.
As for the underlying interests, they became quite clear.
Since Simon had decided to enter the industry, he wouldn't miss out on Gilead, and he planned to help advance the political career of the future Secretary of Defense.
Aside from Gilead, Simon also turned his attention to China.
His strategy there would focus on two areas: Traditional Chinese Medicine (TCM) and health supplements.
Simon planned to establish startups in China dedicated to exploring the feasibility of mass-producing TCM. With thousands of years of accumulated knowledge, TCM was a potential goldmine, waiting to be tapped.
However, the most significant investment opportunity would be in the health supplement industry.
And there was a particularly favorable opportunity on the horizon.
Someone in Zhuhai was about to go bankrupt due to a broken financial chain, and this seemed like the perfect candidate for support.
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