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Biotech / Medical : PFE (Pfizer) How high will it go? -- Ignore unavailable to you. Want to Upgrade?

To: Anthony Wong who wrote (7186)	3/10/1999 8:08:00 AM
From: BigKNY3	Respond to of 9523

Is Merck's Medicine Chest Getting Bare? -2: 03/09/99 Dow Jones News Service Krensavage says Merck is counting on Vioxx to boost sales; it hopes to position the drug as an antidote to arthritic pain and other kinds of chronic pain-a broader application than the one Monsanto got from the FDA. Yet, he warns, "any time that you bet on one big drug to carry a company, you're asking for trouble." But for Merck to grow earnings by 11% in 2000 - down from First Call's consensus estimate of 14% for 1999 - it needs to sell $1.3 billion worth of Vioxx next year, estimates ABN AMRO pharmaceutical analyst James Keeney. While Merck has a chance of hitting that target, Keeney questions why "a company growing earnings 11% next year" should command such a high valuation. As of Tuesday's close, the shares were changing hands at nearly 34 times the consensus 1999 earnings estimate of $2.46 a share, according to First Call. That's almost 2 1/2 times Merck's projected 1999 earnings growth and a 25% premium to the S&P 500's 1999 P/E. Another worry: patent expirations. Among others, there's Pepcid, which generated about $1.1 billion in sales in 1998. But Pepcid's patent expires in October 2000, and sales will drop to a mere $115 million in 2002, Seiden projects. There are also some jitters about MK-869, an antidepressant whose development was slowed after the announcement of disappointing test results in January. The drug is now set for Phase III clinical testing to treat chemotherapy patients for nausea, a much smaller market than the one for antidepression drugs. (Merck is also trying to develop an as-yet-unnamed, but more powerful, drug that's similar to MK-869.) Partly because of the uncertainty about MK-869, CIBC Oppenheimer downgraded Merck to Buy from Strong Buy in late January. The generally bullish report notes that the disappointing results of the tests "cast a shadow" over Merck's earnings growth after 2002. The many bulls on Merck stock insist that any earnings deceleration in 2001 and 2002 is already factored into the share price. They point out that the company, armed with a strong balance sheet and joint ventures with biotech companies, has a fine record of successful product launches - about a dozen new drugs since 1995. It also has a promising antiasthma drug, Singulair, which Seiden of J.P. Morgan projects will generate more than $1 billion in annual sales in 2001. Also, at about 34 times 1999 earnings, Merck trades at a lower multiple than do other U.S. pharmaceutical giants like Pfizer and Eli Lilly & Co. (LLY). Large-cap U.S. pharmaceutical companies trade at around 37 times 1999 earnings estimates, according to ABN Amro. By comparison, Pfizer trades at a whopping 55.7x 1999 earnings estimates, while Eli Lilly is at more than 41x, according to First Call. Merck stock currently trades at about a 10% discount to its peer group, compared with a 10% premium historically, according to J.P. Morgan. But that doesn't make the valuation compelling, argues Keeney of ABN Amro: "If you're buying peak earnings growth for the next couple of years, how cheap is the stock?" We've noted before that Merck's stock looked pricey, only to watch the shares rise. (See Weekday Trader, "Has the Market OD'd On Drug Stocks?" January 20.) But if Vioxx fails to shoulder the heavy load expected of it during the next couple of years, Merck's stock could be

To: Anthony Wong who wrote (7186)	3/10/1999 8:15:00 AM
From: BigKNY3	Read Replies (2) \| Respond to of 9523

Eager Canadians get their Viagra at last Ottawa approves anti-impotence drug after two-year review CAROLYN ABRAHAM 03/10/99 The Globe and Mail Metro Page A1 The little blue pill that has caused a very big fuss is to penetrate the Canadian market in three weeks and the bedrooms of an estimated three million Canadian men soon after. Health Canada has approved Pfizer's anti-impotence drug Viagra after a two-year safety review and pleading phone calls from sex-hungry Canadians. It's expected in pharmacies by the end of March. Since the United States approved the drug a year ago, Canadians have had countless prescriptions filled across the border at what some doctors dubbed " Viagra Falls." Originally developed to treat heart conditions, Viagra proved to have the unexpected side effect of sparking strong and long-lasting erections in men who otherwise suffered penile dysfunction. Ironically, the manufacturer's main public relations battle has since been countering reports that the drug actually causes heart problems. Viagra has nevertheless become a cultural icon for a different kind of sexual revolution, a hot commodity in more than 70 countries and one of the fastest-selling drugs in medical history. Gerald Brock, a urologist at St. Joseph's Health Centre in London, Ont., and an associate professor of urology at the University of Western Ontario, said "We are very happy that Health Canada has finally decided, as many other countries have, that Viagra is a safe and effective treatment for erectile dysfunction." The drug is reported to help seven in 10 men with erectile problems and Pfizer is now testing its sexual effects in women. Urologists who appeared on behalf of Pfizer at a news conference yesterday, said reports that Viagra might be harmful have been misleading. They said deaths linked to the drug in the United States included a homicide and a drowning of men who just happened to have prescriptions for Viagra . They also denied that Viagra increases the risk of cardiac problems, which the U.S. Food and Drug Administration concluded after reviewing the data in November, 1998. To date, about seven million American men have taken 60 million Viagra pills and about 130 men have died. "What's confusing is that guys with erectile dysfunction are at a higher risk of . . . cardiac problems," Dr. Brock said. He explained that such men should perhaps no more be having sex than they should be shovelling snow or running up the stairs. "Sex is exercise," he said. "We are just hearing about this now because we are seeing a landslide of men coming forward for [ Viagra ]." Diseases of aging, like diabetes and heart disease, also tend to put men at higher risk of erectile problems. But both the drug company and doctors are adamant that Viagra must not be taken by patients who are also taking any form of nitroglycerin, which is usually prescribed for cardiac patients. The two drugs together could result in a nitroglycerin overdose. Side effects reported during international clinical trials -- which involved 498 Canadians -- included headaches, flushing and indigestion. A blue tinge in vision has also been reported. But all men are advised to see their doctor with their partners and have a medical exam before taking the drug. "I don't know how many of you would like to stick a needle in your penis," said Jack Barkin, chief of urology at the Humber River Regional Hospital, referring to the injections, vacuums and implants currently used in treatment. Viagra -- sildenafil citrate -- helps the flow of blood into the penis necessary to obtain and maintain an erection. But, Dr. Barkin warned, "You can't just pop the pill and watch Oprah and expect something to happen to you." Men still require natural sexual stimulation after taking Viagra , he said, which is to be taken 30 minutes to an hour before the patient expects to have sex. The urologists also emphasized that Viagra is not an aphrodisiac, nor is there evidence that it enhances the erections of normal, healthy men. In Canada, Viagra is to sell for $12 to $13 per pill, excluding the dispensing fee. This would make it comparable to the U.S. price, although for Canadian sales the drug company has significantly changed the packaging to blister packs of four or eight tablets. Theresa Firestone, Pfizer Canada's vice-president of government and public affairs, said this was partly done to prevent counterfeit production of the drug -- which has been a problem in other countries. THE LITTLE BLUE PILL How it works: Viagra aids blood flow into the penis, enabling men to obtain and maintain an erection. Success rate: Pfizer Inc. reports that the drug is effective in seven out of 10 men with erectile problems. Dosage: Men with erectile problems are supposed to take a single tablet 30 minutes to an hour before they expect to have sex. How do you get it? By prescription only from pharmacies. Side effects: Headaches, indigestion and feeling flushed. Viagra is not recommended for people taking nitrate-based heart medication and all cardiac patients should fully discuss its use with their doctors. Use of the drug by men who don't need it could cause permanent erectile problems. Cost: Just under $100 for a pack of eight pills, excluding dispensing fee. THE DRUG: HOW IT WORKS Erectile dysfunction may be caused by insufficient amounts of chemical messages being received by the penis or by the smooth muscle's inability to relax. How Viagra can help 1. In the penis's flaccid state, the smooth muscle cells in the erectile tissue are contracted, constricting the arteries and limiting blood flow to the penis. 2. Sexual stimulus causes chemical messages to be produced that should have the effect of relaxing the smooth muscle, allowing blood to fill the erectile tissue. These messages are gradually broken down by enzymes. 3. Viagra works by blocking the specific enzymes that would break down the chemical messages. This allows for the production and reception of sufficient quantities of chemical messages, allowing and erection to form. 4. As the Viagra wears off, enzymes are no longer blocked and break down the chemical messages. The erectile tissue contracts, reducing blood flow into the penis and opening veins, which carry blood away. ... Erectile dysfunction is associated with many underlying conditions and risk factors. Age-related illnesses rather than aging itself, are usually the cause. Here are a few: Diabetes High cholesterol High blood pressure Spinal-cord injury Alcohol use Depression Smoking Pelvic surgery Multiple sclerosis