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
Pfizer Caught Illegally Marketing Bextra, Feds Won’t Prosecute Because “Pfizer Too Big To Nail”
by ilene - April 5th, 2010 1:58 pm
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
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
by ilene - March 24th, 2010 2:01 pm
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
by ilene - January 13th, 2010 3:33 pm
The case for Pfizer
Courtesy of Vitaliy Katsenelson, at Contrarian Edge
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.
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?
by ilene - December 15th, 2009 2:46 pm
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
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.
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Pfilthy Pfizer Pfined
by ilene - September 3rd, 2009 7:15 pm
Joshua’s views on drug companies marketing drugs – good points I agree with. – Ilene
Pfilthy Pfizer Pfined
Courtesy of Joshua M Brown, The Reformed Broker
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).
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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...
Ilene is editor and affiliate program
coordinator for PSW. She manages the site