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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Zero Hedge

Trump Sues Manhattan D.A. In Response To Subpoenas

Courtesy of ZeroHedge View original post here.

And now a plot twist: with Trump under relentless attack for the past three years to disclose his tax returns, on Thursday morning the president struck back, suing Manhattan District Attorney Cyrus Vance to block an attempt by New York state prosecutors to obtain eight years of the president’s tax returns in a probe of whether the Trump Organization falsified business records.   

...



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Phil's Favorites

At Press Conference, Fed Chair Powell Refuses to Answer Whether Wall Street Banks Are Too Big to Manage

Courtesy of Pam Martens

Fed Chairman Jerome Powell at Press Conference, September 18, 2019

Following a lack of liquidity on Wall Street, which necessitated the Federal Reserve having to provide $53 billion on Tuesday and another $75 billion on Wednesday to normalize overnight lending in the repo market, the Chairman of the Fed, Jerome (Jay) Powell held his press conference at 2:30 p.m. yesterday. The press gathering followed both a one-quarter point cut in the Fed Funds rate by the Fed yesterday as well as the first intervention by the Fed in the overnight lending market since the financi...



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Insider Scoop

How Cheapskates Can Access Mid Caps

Courtesy of Benzinga

For investors that don't like stocks but do enjoy saving money on fund fees, exchange traded funds are highly desirable destinations. And for those looking to dance with mid-cap stocks, a desirable asset class, there are plenty of compelling ETFs for cost-conscious investors to consider.

What Happened

The Schwab U.S. Mid-Cap ETF (NYSE: ...



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The Technical Traders

SAFE ASSETS - A TRADING STRATEGY FOR UTILITIES, GOLD, AND BONDS

Courtesy of Technical Traders

Chris Vermeulen, Founder of The Technical Traders shares his trading strategy for safer assets. While precious metals and bonds had a great run, the charts are showing the utilities could be the place to be in the short term. It’s important to note we are not saying the other safe havens are going to crash but it’s all about the time frame and playing the sector that could pop first.

LISTEN HERE NOW

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Kimble Charting Solutions

Stocks, Oil, and Bond Yields At Critical Bullish Breakout Tests!

Courtesy of Chris Kimble

It’s not often that three asset classes reach similar important trading points all at once.

But that’s exactly what’s happening right now with stocks, crude oil, and treasury bond yields.

And this is occurring on Federal Reserve day no less! Something has got to give.

In the chart above y...



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Lee's Free Thinking

Is The Drone Strike a Black Swan?

Courtesy of Lee Adler

Pundits are calling yesterday’s drone strke a “black swan.” Can a drone strike on a Saudi oil facility, be a “black swan.”

According to Investopedia:

A black swan is an unpredictable event that is beyond what is normally expected of a situation and has potentially severe consequences. Black swan events are characterized by their extreme rarity, their severe impact, and the practice of explaining widespread failure to predict them as simple folly in hindsight.

I seriously doubt that no one expected or could have predicted a drone strike on a Saudi oil facility.

Call Me A B...

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Chart School

Crude Oil Cycle Bottom aligns with Saudi Oil Attack

Courtesy of Read the Ticker

Do the cycles know? Funny how cycle lows attract the need for higher prices, no matter what the news is!

These are the questions before markets on on Monday 16th Aug 2019:

1) A much higher oil price in quick time can not be tolerated by the consumer, as it gives birth to much higher inflation and a tax on the average Joe disposable income. This is recessionary pressure.

2) With (1) above the real issue will be the higher interest rate and US dollar effect on the SP500 near all time highs.

3) A moderately higher oil price is likely to be absorbed and be bullish as it creates income for struggling energy companies and the inflation shock may be muted. 

We shall see. 

...

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Digital Currencies

China Crypto Miners Wiped Out By Flood; Bitcoin Hash Rate Hits ATHs

Courtesy of ZeroHedge View original post here.

Last week, a devastating rainstorm in China's Sichuan province triggered mudslides, forcing local hydropower plants and cryptocurrency miners to halt operations, reported CoinDesk.

Torrential rains flooded some parts of Sichuan's mountainous Aba prefecture last Monday, with mudslides seen across 17 counties in the area, according to local government posts on Weibo. 

One of the worst-hit areas was Wenchuan county, ...



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Biotech

The Big Pharma Takeover of Medical Cannabis

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

 

The Big Pharma Takeover of Medical Cannabis

Courtesy of  , Visual Capitalist

The Big Pharma Takeover of Medical Cannabis

As evidence of cannabis’ many benefits mounts, so does the interest from the global pharmaceutical industry, known as Big Pharma. The entrance of such behemoths will radically transform the cannabis industry—once heavily stigmatized, it is now a potentially game-changing source of growth for countless co...



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How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

Still, the stock market has been better over the last 10 (7%) an...



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