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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (40399)	12/6/2010 12:05:21 PM
From: E_K_S	Read Replies (3) \| Respond to of 78717

Hi Paul - Re: Value in Drug Companies? MRK vs PFE Can a new CEO help PFE and their drug pipeline? bizjournals.com Pfizer CEO Kindler resigns From the article:"...After more than four years at the helm, President and CEO Jeffrey Kindler has resigned from Pfizer Inc., which employs about 500 at research facilities in the St. Louis area. The New York-based pharmaceutical giant's (NYSE: PFE) board of directors elected Ian Read, 57, currently head of the company's global biopharmaceutical operations, to serve as president and CEO...." Not too sure if this news is going to help PFE and their drug pipeline issues. I continue to own PFE but not adding to my shares. I have been selling covered calls and harvesting earlier tax losses to bring my average cost down to $19.00/share. =================================================================== MERCK & CO., INC. (NEW) (NYSE: MRK ) With a 4.4% dividend and 9 PE, I like MRK as a possible add if the price is right (ie below $30.00/share). I have owned MRK off and on with my latest purchases in Q4 2008 and Q2 2009. My average cost is now at $28.50/share. This is my 2nd largest drug stock position. PFE is my largest. PFE & MRK combined represent 4.5% of the total portfolio(s) value. Not only do the analysts have problems forecasting the success of new drugs, many times the companies themselves have trouble knowing if they are going to have a hit or not. Could this be MRK's next big block buster drug? Next big thing? Big cholesterol drop with new drug Novel drug drops bad, raises good cholesterol to record levels; Merck launches bigger study finance.yahoo.com From the article:"...An experimental Merck drug safely boosted good cholesterol to record highs while dropping bad cholesterol to unprecedented lows in a study that stunned researchers and renewed hopes for an entirely new way of lowering heart risks...". ========================================================================= Since I have no idea what the next block buster drug will be, I have structured my portfolio(s) w/ a basket of the larger drug stocks. They include, PFE, MRK, LLY, GSK, COV, and BMY. The group represents 7.5% of the portfolio(s) and is around the amount I want allocated to this sector. finance.yahoo.com finance.yahoo.com My most recent purchase was COV on 11/01/2010 at $39.46. My most recent sale was SNY where I closed out my position based on your earlier post regarding the companies buy out offer for Genzyme. FWIW, I may buy SNY if the price falls below $27.00/share. What's your target allocation for the Drug/pharmaceutical sector? EKS