Warner Lambert's Shares Hit 52-Week High After Analysts' Comments
June 29, 1998 6:17 PM
By Melanie Trottman, Staff Reporter
NEW YORK -(Dow Jones)- Shares of
Warner-Lambert Co. hit a new 52-week high Monday,
after an analyst's bullish comments and a report showing
increasing prescriptions for the company's diabetes drug
Rezulin and Lipitor, which helps lower cholesterol.
Shares of the Morris Plains, N.J.-based drug company
reached a new 52-week high of $70.50. The stock
(WLA) eased a bit in late New York Stock Exchange
trading Monday to close at $69.188, up $2.25, or
3.4%.
Several analysts cited the comments by Donaldson
Lufkin analyst Kent Blair as a reason for the stock
increase. Blair recommended that investors switch out of
Viagra maker Pfizer Inc. - cited as "the highest multiple
pharmaceutical stock" - and into Warner-Lambert.
"We have a high degree of conviction that WLA will
meet the numbers, whereas longer-term sales of Viagra
are expected to fall far short of the bull's expectations,"
Blair said.
Pfizer's stock has more than doubled in the past year
amid the success of its impotence drug Viagra, which the
company began selling in April. The New York Stock
Exchange-listed stock (PFE), which has traded as low
as $51.063 and as high as $121.75 in the past year,
closed Monday at $109.75, down $2.188, or 2.0%.
In addition to Blair's report, Warner-Lambert's stock
may also have gotten a lift from the release of the weekly
prescription numbers by health-care auditor IMS
America, which showed Lipitor and Rezulin continue to
gain ground in their markets.
ABN Amro analyst Mario Corso said Rezulin's
increased share of the market for diabetes treatments
probably lifts recent investor concern about the drug.
Earlier this month, the company said a federal study
trying to determine if Rezulin could be used to prevent
the onset of diabetes was discontinued after a patient
taking the drug died. The company said the death was
caused by complications unrelated to the study of the
medication.
According to a company spokesman, Rezulin's share of
new prescriptions in the oral diabetes market increased
to 10.9% for the week ended June 19, from 10.6% the
previous week. The number was about 9.5% two
months ago, down from a high of 12% in November
where it stood before the drug was relabeled to
emphasize the need for more diligent liver function tests,
Blair said in his report. Now, Rezulin's market share
"continues to claw its way back up toward the
November '97 high," the report said.
Warner Lambert's cholesterol-lowering drug Lipitor also
gained new prescription market share for the week
ended June 19. Lipitor's share in the market was 38.3%,
up from 38.1% a week earlier, a company spokesman
said. About two months ago, the number was about
36%, Corso said.
Blair expects second-quarter sales at Warner Lambert
to be up about 25%, paced by what he called an
"almost doubling" in the U.S. pharmaceutical business,
where Lipitor and Rezulin "remain tremendously strong."
Foreign pharmaceutical revenue are forecast to have
expanded 25% to 30%, according to the report.
Melanie Trottman; 201-938-5099
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