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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Phil's Favorites

Theresa May Brexit deal hammered in parliament, but be wary of prospects of a new 'consensus' approach

 

Theresa May Brexit deal hammered in parliament, but be wary of prospects of a new 'consensus' approach

Courtesy of Simon Usherwood, University of Surrey

Another day, another record. The 230 majority against the motion to approve Theresa May’s withdrawal agreement on the UK’s exit from the EU smashes pretty much any parliamentary record one cares to discover.

That May’s immediate response was to make time for the house to debate and vote on Labour’s motion of no-confidence in her the day after her loss was thus hardly a surprise: how else to respond to such a heavy blow against the central platform and policy of the government?

And yet the abiding impression o...



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Zero Hedge

Something Wicked This Way Comes

Courtesy of John Mauldin, MauldinEconomics.com

For a couple of years now, the economic narrative has shown a comparatively strong US against weakness in Europe and some of Asia (NOT China). The US, we are told, will stay on top. I agree with that, as far as it goes... but I’m not convinced the “top” will be so great.

Americans like to think we are insulated from the world. We have big oceans on either side of us. Geopolitically, they serve as buffers. But economically they connect us to other important markets that are critical to many US businesses. Problems in those markets are ultimately problems for the US, too.

Last week I gave you my ...



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Digital Currencies

Crypto-Bubble: Will Bitcoin Bottom In February Or Has It Already?

Courtesy of Michelle Jones via ValueWalk.com

The new year has been relatively good for the price of bitcoin after a spectacular collapse of the cryptocurrency bubble in 2018. It’s up notably since the middle of December and traded around the psychological level of $4,000... so is this a sign that the crypto market is about to recover?

Of course, it depends on who you ask, but one analyst discovered a pattern which might point to a bottom next month.

A year after the cryptocurrency bubble popped

CCN...



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ValueWalk

D.E. Shaw Investment Calls For Leadership Change At EQT

By ActivistInsight. Originally published at ValueWalk.

Elliott Management has offered to acquire QEP Resources for approximately $2.1 billion, contending the oil and gas explorer’s turnaround efforts have done little to lift the company’s share price. The company responded and said that a thorough review of the proposition is imperative in order to properly act in the best interests of shareholders, “taking into account the company’s other alternatives and current market conditions.” The news came only a month after Travelport Worldwide agreed to sell itself to Siris Capital Group and Elliott’s private equity arm Evergreen Coast Capital for $4.4 billion in cash and two months after Athenahealth was bought by Veritas and Evergreen for $5.7 bi...



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Kimble Charting Solutions

Gold & Silver Testing Important Breakout Levels!

Courtesy of Chris Kimble.

Gold and Silver from a long-term perspective have created a series of lower highs over the past 8-years. Will 2019 bring a change to this trend? A big test is in play!

Gold since the lows in 2016 has created a series of higher lows, while Silver may have created a double bottom.

Gold & Silver are currently facing break attempts a (1) and (2). These falling resistance lines have disappointed metals bulls for the past few years.

The direction of Gold and Silver weeks and months from now should be highly influenced by what each does as they are attempting to break above important resistance levels.

To become a member of Kimbl...



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Insider Scoop

UBS Says Disney's Streaming Ambition Gives It A 'New Hope'

Courtesy of Benzinga.

Related DIS Despite Some Risks, Analysts Still Expecting Double Digit Growth From Communications Services In Q4 ...

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Chart School

Weekly Market Recap Jan 13, 2019

Courtesy of Blain.

In last week’s recap we asked:  “Has the Fed solved all the market’s problems in 1 speech?”

Thus far the market says yes!  As Guns n Roses preached – all we need is a little “patience”.  Four up days followed by a nominal down day Friday had the market following it’s normal pattern the past nearly 30 years – jumping whenever the Federal Reserve hints (or essentially says outright) it is here for the markets.   And in case you missed it the prior Friday, Chairman Powell came back out Thursday to reiterate the news – so…so… so… patient!

Fed Chairman Jerome Powell reinforced that message Thursday during a discussion at the Economic Club of Washington where he said that the central bank will be “fle...



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Members' Corner

Why Trump Can't Learn

 

Bill Eddy (lawyer, therapist, author) predicted Trump's failure based on his personality, which was evident years ago. This article, written in 2017, references a prescient article Bill wrote before Trump became president, in July, 2016, 5 Reasons Trump Can’t Learn. ~ Ilene 

Why Trump Can’t Learn

Donald Trump by Gage Skidmore (...



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Biotech

Opening Pandora's Box: Gene editing and its consequences

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

 

Opening Pandora's Box: Gene editing and its consequences

Bacteriophage viruses infecting bacterial cells , Bacterial viruses. from www.shutterstock.com

Courtesy of John Bergeron, McGill University

Today, the scientific community is aghast at the prospect of gene editing to create “designer” humans. Gene editing may be of greater consequence than climate change, or even the consequences of unleashing the energy of the atom.

...

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Mapping The Market

Trump: "I Won't Be Here" When It Blows Up

By Jean-Luc

Maybe we should simply try him for treason right now:

Trump on Coming Debt Crisis: ‘I Won’t Be Here’ When It Blows Up

The president thinks the balancing of the nation’s books is going to, ultimately, be a future president’s problem.

By Asawin Suebsaeng and Lachlan Markay, Daily Beast

The friction came to a head in early 2017 when senior officials offered Trump charts and graphics laying out the numbers and showing a “hockey stick” spike in the nationa...



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OpTrader

Swing trading portfolio - week of September 11th, 2017

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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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

·       How 2017 Will Affect Oil, the US Dollar and the European Union

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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