UPDATE 1-Chanos says shorting AstraZeneca, Siemens

NEW YORK, Sept 9 (Reuters) - Famed hedge fund manager James Chanos said he is selling short drug company AstraZeneca Plc (AZN.L) and industrial conglomerate Siemens AG (SIEGn.DE) as part of a broader bet that health-care companies are overvalued.

Chanos told business channel CNBC in an interview on Wednesday that some 30 percent of AstraZeneca's revenue is threatened as many of its key drugs face generic competition, while an additional 20 percent comes from U.S. Medicare and Medicaid prescription drug plans.

The valuations of health-care companies have ballooned on the popular view that an aging Baby Boomer population will stoke demand for the companies' products and services, but those expectations are already reflected in current stock prices, he said.

"The industry has become so creaky, so bloated, they are going to start bankrupting all sorts of entities," he said, "not just companies, but the government as well."

Chanos, who early on warned that Enron's financial results were too good to be true, in May told a conference of hedge fund managers that his latest investment theory is that health-care companies have grown bloated and overvalued after decades of U.S. government support.

The hefty profit margins of these companies, 50 percent higher than the that of the S&P 500, are likely to narrow as Washington searches for ways to cut spending, he said. Big Pharma, meanwhile, will come under pressure from generic drug makers.

On Wednesday, Chanos said he has expanded the range of his health-care short positions from HMOs to big pharmaceutical companies, including AstraZeneca, and hospital capital equipment makers such as Siemens.

He said his firm, Kynikos Associates, is also shorting smaller equipment makers, but he declined to identify these companies. In May he said he was shorting oxygen supplier Lincare Holdings Inc (LNCR.O).

A number of ancillary companies that depend on health-care spending may also fell the pinch, he told CNBC, including staffing companies that help businesses control their health-care benefit costs. (Reporting by Joseph A. Giannone; editing by John Wallace)