Big Pharma ... Big Woop!

The NYT reported today that Pfizer is about to "lose" a $10 billion a year revenue stream, when the patent on Lipitor expires later this year. Making $10 billion a year for more than a decade should be enough to protect the financial security of ANY company. Calling this a loss is truly ridiculous. Perhaps reducing bonuses and shareholder dividends during the high times would have left Pfizer with enough cash to reinvest in itself.

This is a "problem" and a loss for Wall St. expectations of double-digit growth year after year. To avoid this terrible problem of not making $10 billion dollars this year and maybe next year, shareholders should be willing to expect lower returns for longer-term stability, but what the fuck am I saying. The Street needs to bleed the pig dry and then move on to another bubble victim.

The mere idea that we are to be sympathetic to the woes of the likes of AstraZeneca, GlaxoSmith-Kline, Novartis, Novo Nordisk, Eli Lilly and Merck is a hard pill to swallow. It's particularly challenging when some of these same companies have recently released drugs with nasty side effects.

In 2009 Pfizer paid the largest criminal fine in US History as part of a $2.3 billion settlement regarding off-label drug use. Some pharma companies have made spectacular profits from off-label sales of drugs that have been approved for only limited use. Off-label may mean that the drug is developed for oral use, but is being marketed as an injectable.

The regulatory environment in Europe has become more difficult for pharma companies to make huge profits as governments have regulated the prices of drugs more than in the US. As Europe starts to become more restrictive for big Pharma profiteers thay have turned their attention to less restrictive markets in Brazil, China and India. Look for injuries and lawsuits in those markets to be be handled with cash settlement and little press coverage.

The irony of this "big problem" for big Pharma is that it has caused stock values to dip and speculators to buy into the notion of yet another bubble.

"Welcome my son, welcome to the machine."