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Posts Tagged ‘Pfizer’

Pfizer Caught Illegally Marketing Bextra, Feds Won’t Prosecute Because “Pfizer Too Big To Nail”

More twilight zone material: progress from the Pinto case stalled at the mercy of the "Too Big To Fail" doctrine. Undoubtedly backed by the misguided "rational human economic model."  In the Pinto case, punitive damages were awarded to prevent future corporate decisions to measure cost/benefits by putting a price tag on tag on human life….   Ilene

pinto Before the Ford experts left Washington to return to drafting tables in Dearborn they did one other thing. They managed to informally reach an agreement with the major public servants who would be making auto safety decisions. This agreement was that "cost-benefit" would be an acceptable mode of analysis by Detroit and its new regulators. And, as we shall see, cost-benefit analysis quickly became the basis of Ford’s argument against safer car design.

Cost-benefit analysis was used only occasionally in government until President Kennedy appointed Ford Motor Company president Robert McNamara to be Secretary of Defense. McNamara, originally an accountant, preached cost-benefit with all the force of a Biblical zealot. Stated in its simplest terms, cost-benefit analysis says that if the cost is greater than the benefit, the project is not worth it—no matter what the benefit. Examine the cost of every action, decision, contract part or change, the doctrine says, then carefully evaluate the benefits (in dollars) to be certain that they exceed the cost before you begin a program or—and this is the crucial part for our story—pass a regulation.

As a management tool in a business in which profits matter over everything else, cost-benefit analysis makes a certain amount of sense. Serious problems come, however, when public officials who ought to have more than corporate profits at heart apply cost-benefit analysis to every conceivable decision. The inevitable result is that they must place a dollar value on human life.

Ever wonder what your life is worth in dollars? Perhaps $10 million? Ford has a better idea: $200,000.  [Pinto Madness, Mother Jones, Oct. 1977]

Pfizer Caught Illegally Marketing Bextra, Feds Won’t Prosecute Because "Pfizer Too Big To Nail"

Courtesy of Mish

CNN Health has an interesting article detailing illegal marketing practices at Pfizer. However, government officials looked the other way because …
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The Calm Before the Storm – Big Pharma Is Gonna Have Big Problems and Pfizer is the BIGGEST

Second coming of the calm before the storm; fear not, there's time to find shelter. - Ilene 

The Calm Before the Storm – Big Pharma Is Gonna Have Big Problems and Pfizer is the BIGGEST

Courtesy of Pharmboy, member of Phil's Stock World 

This is a brief article of where the pharmaceutical industry has been, and where it could be headed in the near future.  In contrast to past articles where I focused on the pipelines of GSK, LLY, MRK, BMY and ‘biotechs’ GENZ, GILD, and others, this is a summary of the industry.  The overall market continues its grind up and I am gun-shy of its continued direction, but with the passage of the health care bill, biotechs that serve niche markets will be well positioned to see a rise both in stock price and potential M&A activity.  In addition, as noted on Friday, March 19th on the laggers/leaders of the past month or so, Telecom and Healthcare were at the bottom of the pile.  For the review of Big Pharma and some biotech picks at the end, generic companies are excluded from most data (Merck KGaA, Mylan, Teva and Watson).

From 2002 to 2009, the top pharmaceutical companies by sales had growth rates greater than 12% (compounded annually).  Unfortunately, this growth is not sustainable and should move towards flat to nominal growth by 2014.  The growth decline will challenge these companies to seek more profitable routes, including licensing and acquisitions.  Picking the right companies based upon the science is at the forefront of good investing.  Not they will all succeed because the science is sound, but understanding the molecule, target, and the disease helps guide smart decisions.  Good management helps as well!

Let's start with a summary of potential acquirers.  Table 1 is a list of the 15 largest pharmaceutical and biotech companies ranked by healthcare revenue.  Some companies (e.g., Bayer and Johnson) have additional revenue which is not included the sales data.  

Table 1. Top 13 Pharma Companies in Sales (2009) 

Rank

Company

Sales ($M)

Based/Headquartered in

1

Pfizer

50,001

US

2

Hoffmann–La Roche

46,300*

Switzerland

3

Merck & Co.

45,930**

US

4

Novartis


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The case for Pfizer

The case for Pfizer

Courtesy of  Vitaliy Katsenelson, at Contrarian Edge

Pfizer Profits Drop After Pharmacia Charges

I understand why investors don’t want to own Pfizer (PFE); there is little excitement in the stock:

  •  It is down significantly from the Viagra-high it reached in 1998.  Yes, Pfizer is the maker of Viagra, the drug that spawned a slew of commercials that made TV unwatchable (especially if you have little kids who ask you if they or you need this medicine that makes people on TV hug each other, or ask you “What is reptile dysfunction?”).
  • Pfizer’s earnings have not gone anywhere for years.
  • As with almost anything medical-related, Pfizer is exposed to the political risks of Washington DC.
  • Finally, it is facing patent expirations of its major blockbuster drugs like Lipitor ($12 billion of sales) and a few others that will hinder PFE’s future growth for years. 
Viagra pills

There is not much one can do about TV commercials except cancel cable or watch less TV (I did both).  Nor there is not much one can do about the stock-price decline over the last ten years – maybe the only thing to do is learn not to buy hype; after all, Pfizer was trading at over 50 times earnings in the late ’90s. 

I don’t want to dismiss the political risk, but it seems that due to extensive lobbying efforts by pharmaceutical companies, political risk has turned into only a slight inconvenience.  Pharma companies have agreed to $80 billion of price concessions over the next ten years, but at the same time they’ll benefit from a larger customer base, as more people will have access to health insurance.

Instead of being mesmerized by huge drug expirations, we can do the value-investor kind of thing – estimate the impact of drug expirations on PFE’s cash flows and value the stock using discounted cash-flow analysis based on these assumptions. 

So let’s value Pfizer:

No New Drugs Scenario:  At the end of 2009 Pfizer acquired Wyeth (WYE), a large pharmaceutical company.  I’ll address this very important acquisition in a bit, but first, let’s look at Pfizer on a pre-Wyeth basis.  The fewer optimistic assumptions we use, the less likely the future will disappoint us.  Applying this logic, let’s assume that soon after a drug-patent expiration, as the generic version hits the market, revenue…
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Is Horse Estrogen For Women A Good Idea?

All treatments have risks and side effects, and here we have a treatment for a normal biological change in women, a natural part of aging. So my one question, in response to the ending of this article, is what is the evidence that bio-identical hormone replacement has a profile of greater good than harm? I’d like to see those studies. Haven’t yet. – Ilene

Is Horse Estrogen For Women A Good Idea?

Courtesy of Mish

Horses

Even though female readership on this blog is only eight percent, on behalf of that eight percent, inquiring minds find themselves pondering a rather unusual question: Is Horse Estrogen For Women A Good Idea?

What brings this question to light of day is the marketing efforts of Wyeth (now owned by Pfizer via a merger this year), to promote hormonal treatments Prempro, a combination of aptly named Premarin, an estrogen drug produced from the urine of pregnant mares, and an additional hormone, progestin.

As one might suspect simply from the sound of it, various complications, problems, and lawsuits have arisen.

With that introduction, please consider the New York Times article Menopause, as Brought to You by Big Pharma.

MILLIONS of American women in the 1990s were told they could help their bodies ward off major illness by taking menopausal hormone drugs. Some medical associations said so. Many gynecologists and physicians said so. Respected medical journals said so, too.

Along the way, television commercials positioned hormone drugs as treatments for more than hot flashes and night sweats — just two of the better-known symptoms of menopause.

One commercial about estrogen loss by the drug maker Wyeth featured a character named Dr. Heartman in a white coat discussing research into connections between menopause and heart disease, Alzheimer’s disease and blindness.

“When considering menopause, consider the entire body of evidence,” Dr. Heartman said. “Speak to your doctor about what you can do to help protect your health during and after menopause.”

Connie Barton, then a medical office assistant in Peoria, Ill., was one woman who responded to such messages. She says she took Prempro, from 1997, when she was 53, until 2002, when she received a diagnosis of breast cancer. As part of her cancer treatment, she had a mastectomy to remove her left breast.

Ms. Barton is


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Pfilthy Pfizer Pfined

Joshua’s views on drug companies marketing drugs – good points I agree with. – Ilene

Pfilthy Pfizer Pfined

pfizer

I have friends who work as pharmaceutical sales reps and quite frankly, I’ve never gotten a good answer as to why the pharma industry is even allowed to push drugs on doctors or the general public at large, either with gifts, dinners or television commercials.

I am by no means anti the drug industry, I just get very uncomfortable with the possibility that a doctor may be prescribing a drug for reasons other than that it is the best possible drug for the patient.

Anyway, the Obama administration’s Justice Department has just fired a signal flare over the entire industry with its massive, record-breaking criminal fine against Pfizer (PFE) over it’s marketing activities.  I’d be surprised if the rest of the drugmakers don’t make big adjustments as a result of it.

From the AP via Yahoo Finance:
WASHINGTON (AP) — Federal prosecutors hit Pfizer Inc. with a record-breaking $2.3 billion in fines Wednesday and called the world’s largest drugmaker a repeating corporate cheat for illegal drug promotions that plied doctors with free golf, massages, and resort junkets.

Announcing the penalty as a warning to all drug manufacturers, Justice Department officials said the overall settlement is the largest ever paid by a drug company for alleged violations of federal drug rules, and the $1.2 billion criminal fine is the largest ever in any U.S. criminal case. The total includes $1 billion in civil penalties and a $100 million criminal forfeiture.

If we were to judge degrees of criminality by the size of the fine levied, then we’d have to conclude that Pfizer is the largest criminal entity in the history of the United States.  Now of course that isn’t true (AIG is). 

What is true is that Pfizer has settled a marketing corruption case 4 times this decade, is a repeat offender, and is so large that only a massive fine like this would actually have the power to act as a true deterrent.  Anything less may have just been chalked up by the industry as “a cost of doing business”.
 
$2.3 billion is no joke.
 
Now as far as the whole television commercial thing, can someone explain to


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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743"

Thank you for you time!

 
 

Zero Hedge

"Shocked" White House Slams "Fabrication" After Israel TV Leaks Damning Transcript Of Obama-Netanyahu Phone Call

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

While everyone's attention is glued on Russia and whether Obama can successfully launch World War III, things are going from bad to worse when it also comes to US relations with Israel. Recall that here things were already on the verge of disaster after for some reason, Kerry was unleashed to "arrange" a ceasefire with Israel, when in reality the SecState somehow managed to infuriate every single feuding faction (there are lot of them), Israel included, after Haaretz wrote that "...



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Phil's Favorites

M.A.D. Sanctions; Two Games at Once

Courtesy of Mish.

M.A.D. Sanctions

Sanctions are a lose-lose-lose game. Consumers lose, businesses loses, countries lose. And the hypocrisy alone is appalling.

The EU wants sanctions to hurt Russia "more" than the EU. Thus the EU let a French military sale to Russia go through, while blocking transactions and travel of Russians who had virtually nothing to do with this mess.

Knockout Blow?

For all their efforts will the US or EU accomplish anything with the sanctions on Russia?

Financial Times writer Christopher Granville has the answer in his take EU’s Sanctions on Russia Will Fail to be a Knockout Blow.
The main burden of the EU sanctions mooted by the commission would appear...



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Insider Scoop

Orbitz Worldwide Annouces Large Stakeholder Will Sell Shares In Public Offering

Courtesy of Benzinga.

Related OWW Morning Market Losers UPDATE: Oppenheimer Initiates Coverage On Orbitz Powerful Proxy Adviser Blasts Target Board Over Breach (Fox Business)

In a press release Wednesday, Orbitz Worldwide (NYSE: OWW) announced its largest stakeholder will sell 20 million shares of the company.

Orbitz released a separate press release stating mostly ...



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Chart School

The End of QE: Some Common Misunderstandings

Courtesy of Doug Short.

Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.

I have discussed for some time that there are a couple of inherent misunderstandings about the Federal Reserve's ending of the current large-scale asset purchase program (LSAP), or more affectionately known as Quantitative Easing (QE). The first is "tapering is not tightening" and the second is "interest rates will rise." Let me explain.

The Federal Reserve has been running extremely "accommodative" monetary policies since the end 2008. The two primary goals of the Federal Reserve have been to artificially suppress interest rates and boost asset prices in "hopes" that an organic economic recovery would take root. As I quoted in "How E...



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All About Trends

Mid-Day Update

Reminder: David is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Option Review

Kellogg Call Options Active Ahead Of Earnings

Shares in packaged foods producer Kellogg Co. (Ticker: K) are in positive territory on Monday afternoon, trading up by roughly 0.20% at $65.48 as of 2:20 p.m. ET. Options volume on the stock is well above average levels today, with around 12,500 contracts traded on the name versus an average daily reading of around 1,700 contracts. Most of the volume is concentrated in September expiry calls, perhaps ahead of the company’s second-quarter earnings report set for release ahead of the opening bell on Thursday. Time and sales data suggests traders are snapping up calls at the Sep 67.5, 70.0 and 72.5 strikes. Volume is heaviest in the Sep 72.5 strike calls, with around 4,600 contracts traded against sizable open interest of approximately 11,800 contracts. It looks like traders paid an average premium of $0.37 per contrac...



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Sabrient

Sector Detector: Bold bulls dare meek bears to take another crack

Courtesy of Sabrient Systems and Gradient Analytics

Once again, stocks have shown some inkling of weakness. But every other time for almost three years running, the bears have failed to pile on and get a real correction in gear. Will this time be different? Bulls are almost daring them to try it, putting forth their best Dirty Harry impression: “Go ahead, make my day.” Despite weak or neutral charts and moderately bullish (at best) sector rankings, the trend is definitely on the side of the bulls, not to mention the bears’ neurotic skittishness about emerging into the sunlight.

In this weekly update, I give my view of the current market environment, offer a technical analysis of the S&P 500 chart, review our weekly fundamentals-based SectorCast rankings of the ten U.S. business sectors, and then offer up some actionable trading ideas, incl...



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OpTrader

Swing trading portfolio - week of July 28th, 2014

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Stock World Weekly

Stock World Weekly

Newsletter writers are available to chat with Members regarding topics presented in SWW in the comments below each post. 

Our weekly newsletter Stock World Weekly is ready for your enjoyment.

Read about the week ahead, trade ideas from Phil, and more. Please click here and sign in with your PSW user name and password. Or take a free trial.

We appreciate your feedback--please let us know what you think in the comment section below.  

...

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Digital Currencies

BitLicense Part 1 - Can Poorly Thought Out Regulation Drive the US Economy Back into the Dark Ages?

Courtesy of Reggie Middleton.

An Op-Ed piece penned by Veritaseum Chief Contracts Officer, Matt Bogosian

This past weekend (despite American Airlines' best efforts), Reggie and I made it to the Second Annual North American Bitcoin Conference in Chicago. While there were some very creative (and very ambitious) ideas on how to try to realize the disruptive Bitcoin protocol, one of the predominant topics of discussion was New York Superintendent of Financial Services Benjamin Lawsky's proposed Bitcoin regulations (the BitLicense proposal) - percieved by many participants at the event as an apparent ...



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Market Shadows

Danger: Falling Prices

Danger: Falling Prices

By Dr. Paul Price of Market Shadows

 

We tried holding up stock prices but couldn’t get the job done. Market Shadows’ Virtual Value Portfolio dipped by 2% during the week but still holds on to a market-beating 8.45% gain YTD. There was no escaping the downdraft after a major Portuguese bank failed. Of all the triggers for a large selloff, I’d guess the Portuguese bank failure was pretty far down most people's list of "things to worry about." 

All three major indices gave up some ground with the Nasdaq composite taking the hardest hi...



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Pharmboy

Biotechs & Bubbles

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

Well PSW Subscribers....I am still here, barely.  From my last post a few months ago to now, nothing has changed much, but there are a few bargins out there that as investors, should be put on the watch list (again) and if so desired....buy a small amount.

First, the media is on a tear against biotechs/pharma, ripping companies for their drug prices.  Gilead's HepC drug, Sovaldi, is priced at $84K for the 12-week treatment.  Pundits were screaming bloody murder that it was a total rip off, but when one investigates the other drugs out there, and the consequences of not taking Sovaldi vs. another drug combinations, then things become clearer.  For instance, Olysio (JNJ) is about $66,000 for a 12-week treatment, but is approved for fewer types of patients AND...



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Promotions

See Live Demo Of This Google-Like Trade Algorithm

I just wanted to be sure you saw this.  There’s a ‘live’ training webinar this Thursday, March 27th at Noon or 9:00 pm ET.

If GOOGLE, the NSA, and Steve Jobs all got together in a room with the task of building a tremendously accurate trading algorithm… it wouldn’t just be any ordinary system… it’d be the greatest trading algorithm in the world.

Well, I hate to break it to you though… they never got around to building it, but my friends at Market Tamer did.

Follow this link to register for their training webinar where they’ll demonstrate the tested and proven Algorithm powered by the same technological principles that have made GOOGLE the #1 search engine on the planet!

And get this…had you done nothing b...



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