MBA 642 Financial Management of Health Institutions
Prerequisite:  MBA 511
This course focuses on the application of financial analysis to financial and operating decisions in the health care industry.  Valuation methods covered include:  net present value of free cash flows, decision tree analysis, real options, and multiples.  The cases allow students to apply these skills to examine the following types of decisions/ situations: estimate the value of a drug that is being developed using both traditional NPV and option pricing; evaluate an R&D limited partnership as an alternative to traditional methods of financing biotech R&D; estimate the value of a pharmaceutical company using publicly available data; identify the best way for a new medical device company to price its products and raise funds; determine why a Medicare HMO is losing money, recommend whether the plan should remain in the market, and recommend changes in benefit design and reimbursement methods if the plan decides to remain in the market; analyze a health system’s profitability by product line and discuss the implications for pure pay or carve-out companies.