AZ News from The Street 2014

From Kramer, so again take with a large grain of salt:


NEW YORK (TheStreet) -- Astrazeneca (AZN) has been downgraded by TheStreet Ratings from Buy to Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:

"We rate ASTRAZENECA PLC (AZN) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and feeble growth in the company's earnings per share."

 

Pay for delay trial concerning Nexium was not thrown out, it will go to a jury:


AstraZeneca Loses Bid to End ‘Pay-For-Delay’ Nexium Trial
By Janelle Lawrence and Erik Larson Nov 24, 2014 12:11 PM ET

AstraZeneca Plc (AZN) and Ranbaxy Laboratories Ltd. (RBXY) failed to derail a landmark trial in the U.S. accusing the companies of colluding to delay the release of a cheaper version of the top-selling heartburn pill Nexium.

U.S. District Judge William Young in Boston today denied a bid by the U.K. drugmaker and the Indian generics manufacturer to end the jury trial early, a court clerk said in an e-mail. The companies had argued the plaintiffs failed to provide enough evidence AstraZeneca illegally paid Ranbaxy to keep the lower-cost alternative off the market.

The trial over AstraZeneca’s “pay-for-delay” deals to block early competition to Nexium is the first of its kind since the U.S. Supreme Court last year opened the door, finding companies can be sued over such deals. The Federal Trade Commission, whose litigation led to the high court ruling, argues such “pay-for-delay” accords cost drug purchasers as much as $3.5 billion a year.

“I’m looking forward to the rest of the trial,” Thomas Sobol, a lawyer for plaintiffs including drug wholesalers and third-party purchasers, said outside court today.
Teva Settles

Teva Pharmaceutical Industries Ltd. (TEVA), another defendant, agreed in principle to settle the lawsuit. The company’s lawyers were allowed by the judge to leave the trial, but no details of the deal were provided in court.

The decision on AstraZeneca’s and Ranbaxy’s request for a so-called directed verdict was issued before today’s session of the trial, which started Oct. 20, was scheduled to begin.

AstraZeneca, which rejected a $117 billion takeover bid from Pfizer in May, is relying on revenue from Nexium and another best-selling drug, Crestor, as it waits for new blockbuster drugs to emerge from its pipeline. The company assumed Nexium would have competition from a generic version in the U.S. on Oct. 1, but Ranbaxy, which has the exclusive right to sell a copy for six months, hasn’t won final regulatory approval to do so.

The case is In Re: Nexium (Esomeprazole) Antitrust Litigation, 1:12-md-02409, U.S. District Court, District of Massachusetts (Boston).

 

Eli Lilly, AstraZeneca launch patient trial for Alzheimer's treatment
Published: Dec 1, 2014 7:19 a.m. ET
By Tomi Kilgore, Reporter

NEW YORK (MarketWatch) -- Eli Lilly LLY, +0.52% and AstraZeneca AZN, +0.31% announced the initiation of a late-stage trial for its treatment for Alzheimer's disease. The first patient was enrolled in the Amaranth study, to test the safety and efficacy of an oral beta secretase cleaving enzyme (BACE) inhibitor knows as AZD3293/LY3314814. "We believe that BACE inhibitors have the potential to target one of the key drivers of this devastating disease," said Samantha Budd, head of translational science at AstraZeneca. "Together with Lilly, we have unique expertise that will allow us to evaluate the potential of AZD3293 as a treatment for Alzheimer's patients." AstraZeneca's stock gained 0.5% in premarket trade, while Eli Lilly shares were still inactive.

 

GSK is cutting costs:

GlaxoSmithKline (GSK) Likely To Cut Hundreds Of US Jobs

GSK might cut hundreds of jobs in its US division following the announcement of a $1.6 billion cost-cutting plan

Published: November 30, 2014 at 9:50 am EST
By: Hannah Ishmael

GlaxoSmithKline plc (ADR) (NYSE:GSK) may lay-off hundreds of employees in the US as part of its strategy to cut costs by $1.6 billion (£ 1 billion), according to a report by Bloomberg.

The information was given by sources close to the matter. It is expected that the UK-based pharmaceutical giant may disclose its plans for the re-organization as early as the coming week. Sources also said that President of the company's North American division, Deirdre Connelly is expected to address employees in a meeting scheduled for December 3.

GSK has been facing pricing pressures as well as increasing competition in US and European markets, which has led to a decline in its financial performance since the start of the current fiscal year. Revenue for the first nine months of fiscal year 2014 has declined 11% year-over-year at £16.82 billion while earnings per share at 35.8 pence are down 42% YoY

A leader in respiratory drugs, GSK has also been facing declining sales of its key respiratory drug, Advair. The drug which makes up nearly 32% of company revenue lost its patent in 2010, and has been losing sales since. In the nine months of FY14, the drug saw a revenue decline of 14% YoY globally to £3.11 billion, while the decline in the US market for the same period was 24% YoY.

US sales make up a significant chunk of GSK's turnover. So far this year, the US contributed 31% to GSK's turnover with sales of £5.258 billion; however, this reflected an 11% YoY decline. US operations accounted for 17% of its nearly 99,500 global employees in 2013.

To counter the deteriorating performance GSK announced a $1.6 billion cost-cutting plan spanning over the next three years, in its third-quarter FY14 earnings call. Earlier the company signed agreemnts with Novartis and Eli Lilly worth $20 billion divesting its vaccine business. A major portion of the cost-cuts is expected to be implemented by 2016.

In a statement the company said about the cuts: "The aim of this program is to improve performance by taking unnecessary complexity out of our operations and establish a smaller, more focused organization, operating at lower costs, that supports our future portfolio.”

GSK stock has declined 13% year-to-date.

 

Two British companies with different promotional philosophies. One hiring, the other firing.

 

Patient's First, sound familiar?

Mon, Dec 1, 2014, 3:34pm EST - US Markets close in 26 mins
GlaxoSmithKline Plans Reorganization, U.S. Job Cuts
Bloomberg
By Albertina Torsoli and Oliver Staley November 29, 2014 7:01 PM

GlaxoSmithKline Plc (GSK) is planning a reorganization that will include hundreds of job cuts in the U.S., people familiar with the situation said.

The drugmaker is poised to announce a workforce restructuring as soon as this week, said the people, who asked not to be identified discussing a private company matter. The changes will involve operations in the U.S., where London-based Glaxo has struggled to sell respiratory medicines in recent months. Deirdre Connelly, president of North American operations, is scheduled to speak to U.S. employees on Dec. 3, two people said.

Glaxo pledged in October to cut costs by 1 billion pounds ($1.56 billion) over three years, with half the savings coming in 2016. U.S. sales are flagging amid increased competition for the company's best-selling Advair asthma medication. Analysts estimate that sales of the drug will decline 30 percent by 2015, from $5.3 billion last year.

This has put Connelly under pressure. The former Eli Lilly & Co. executive was part of a management reshuffle last month, and now reports to Abbas Hussain, Glaxo's head of global pharmaceuticals, rather than directly to Chief Executive Officer Andrew Witty. Glaxo shares have fallen about 8 percent this year, while the Bloomberg Europe Pharmaceutical Index has climbed about 22 percent.

In October, "GSK announced a new restructuring program to refocus our global pharmaceuticals business and deliver cost savings," Glaxo said in an e-mailed statement on Nov. 28. "The aim of this program is to improve performance by taking unnecessary complexity out of our operations and establish a smaller, more focused organization, operating at lower costs, that supports our future portfolio."

‘Patients First'

Each business unit is "currently deciding how to respond to this challenge," Glaxo also said. "When we do have proposals, we will first share those with our employees."

Glaxo told workers this month it would tweak one part of its "patients first" program in the U.S., which was designed to disconnect compensation of sales representatives from prescription numbers, one person said.

While the program remains in place, changes are being brought to the way sales professionals are tested on knowledge of products as part of their evaluation, two people said. Sales representatives continue to be judged on simulations of interactions with doctors and by manager observations of real meetings, one person said.
U.S. Fine

Connelly unveiled the initiative in 2010, saying the company would no longer link bonuses to sales targets and instead reward sales staff for their scientific knowledge. The changes came as Glaxo grappled with probes into its sales and data disclosure practices. The company eventually paid a $3 billion fine to settle U.S. criminal and civil investigations and signed an agreement with the U.S. government pledging to reform sales and marketing methods.

Some top managers in the U.S. have left Glaxo since Connelly's appointment in 2009, in part driven away by the new approach, several people said. One reason for Glaxo's poor performance in the U.S. may be that the sales force no longer has the right incentives, some analysts have said. Witty intends to expand the model globally by early next year.

"Top performers under our previous sales compensation model continue to be some of the top performers under the patient-focused model we introduced in 2011," Glaxo said in an e-mailed statement on Nov. 28. "We remain resolutely committed to our commercial model and are on track to role out this approach globally."

Glaxo has about 99,000 employees in 115 countries, with about 17,000 in the U.S., where the company gets almost one-third of its sales.

The drugmaker is hoping a new selection of lung medicines led by Breo and Anoro will help make up for Advair's shortfall. So far, sales of the new drugs have fallen short of analyst estimates.

 

Words from our CEO:


I'm a strong believer in Europe: Astrazeneca CEO
CNBC

Discussing a possible British exit from the European Union, Pascal Soriot, CEO of Astrazeneca, says he is a believer in Europe and immigration is key to getting the best talent for his company.

 

We gave up on anti-infectives, Merck just went all in with Cubist:



Merck takes aim at superbugs, to buy Cubist in $9.5 bln deal
Reuters, 6 hours ago

Dec 8 (Reuters) - Merck & Co Inc said on Monday it would buy Cubist Pharmaceuticals Inc in a deal valued at $9.5 billion, giving the major drugmaker an entry into the market for drugs that target so-called superbugs.

Merck and British rival AstraZeneca Plc have turned their attention to newer kinds of antibiotics that attack superbugs - strains of bacteria that are resistant to several types of antibiotics - after the 2013 threat report from the U.S. Centers for Disease Control and Prevention.

The CDC estimated that more than 2 million people in the United States are sickened every year by such infections, with at least 23,000 dying as a result. (http://1.usa.gov/1w5Hhml)

Cubist's lead drug, Ceftolozane/Tazobactamis, is widely expected to win marketing approval from the U.S. Food and Drug Administration later this month as a treatment for complicated urinary tract infections.

Merck will pay $102 per share for Cubist, a premium of 37 percent to the Lexington, Massachussetts-based company's closing share price of $74.36 on Friday.

The deal includes assumption of $1.1 billion in debt.

 

Pfizer goes in for gene therapy company:

Pfizer bets on gene therapy as technology comes of age
By Ben Hirschler

LONDON (Reuters) - Pfizer Inc is moving into the gene therapy space in the latest sign that the technology for fixing faulty genes may finally be ready for prime time, following earlier setbacks.

The U.S. drugmaker said on Monday it was establishing a gene therapy platform to study potential treatments, led by a top UK expert, and had struck a deal with privately owned U.S. biotech firm Spark Therapeutics to develop a treatment for haemophilia.

The Spark program is expected to enter early-stage clinical trials for haemophilia B in the first half of 2015. Spark will be responsible for the early Phase I/II tests, with Pfizer taking over late-stage studies, any regulatory approvals and potential commercialization.

Spark will get $20 million upfront and be eligible for additional payments based on product success worth up to $260 million.

Pfizer's research effort in gene therapy will be led by Michael Linden, a professor from King’s College London and director of the University College London Gene Therapy Consortium. Linden is joining Pfizer on a two-year secondment.

Gene therapy has seen more than 20 years of experiments but research has been dogged by a series of disappointments and safety concerns.

Now, however, scientists have solved some of the earlier problems and treatments are starting to reach the clinic, with a the Western world's first gene therapy set to go on sale in Germany to treat and ultra-rare blood disease.

"The fundamental understanding of the biology of hereditary rare diseases, coupled with advances in the technology to harness disarmed viruses as gene delivery vehicles, provide a ripe opportunity to investigate the next wave of potential life-changing therapies for patients,” said Pfizer research head Mikael Dolsten.

Among other major pharmaceutical companies, Bayer AG struck a gene therapy deal with Dimension Therapeutics in June, while Novartis AG recently established a new cell and gene therapies unit, and Sanofi SA has a long-standing tie-up with Oxford BioMedica.

 

AstraZeneca and Ranbaxy Win a Closely Watched Pay-to-Delay Case
By Ed Silverman

In a closely watched case, a federal court jury decided that a so-called pay-to-delay deal between AstraZeneca AZN.LN -2.91% and Ranbaxy Laboratories 500359.BY +3.59% involving the launch of a generic version of the Nexium heartburn pill did not violate anti-trust laws.

This was the first time that a lawsuit over such deals went to trial since the U.S. Supreme Court ruled last year that drug makers can face greater antitrust scrutiny over pay-to-delay deals. In these arrangements, a brand-name drug maker reaches a settlement with a generic rival in exchange for ending patent litigation and an agreement allowing a copycat medicine to be launched at a future date.

In its 2013 ruling, the Supreme Court said such payments cannot be large and unjustified. The lawsuit, which began two years ago, alleged that wholesalers, pharmacies and consumers were overcharged for years as the result of a 2008 settlement of patent litigation between the drug makers. The plaintiffs claimed the agreement to delay the launch of a generic Nexium was worth nearly $1 billion to Ranbaxy, according to the lawsuit.

Although the jury agreed the deal was large and unjustified, and decided the value of the agreement was unreasonably anticompetitive, the settlement with AstraZeneca did not matter. The jury decided that, even without the deal, AstraZeneca would not have allowed Ranbaxy to sell a generic Nexium before the May 2014 patent expiration date. (here are the jury responses).

“The system worked,” J. Douglas Baldrige, an attorney for Ranbaxy, says in a statement. “The jury understood the facts of the case and was not swayed by wishful thinking on the part of the plaintiffs.” A spokeswoman for AstraZeneca, which faced billions of dollars in penalties, wrote us that “we have always maintained that the plaintiffs’ allegations were without merit.”

In a note sent to us, Thomas Sobol, an attorney for the plaintiffs, wrote that “the jury concluded that AstraZeneca officials… agreed to make a large and unjustified payoff to its generic competitor Ranbaxy in order to delay Nexium generics. Whether the later fact finding by the jury is consistent with those facts is under review. While we are disappointed with this stage of the process, we will continue to seek to vindicate this wrong.”

The trial garnered attention because it was seen as a possible sign that these deals would be restrained. In a report last year, the U.S. Federal Trade Commission estimated the deals cost Americans $3.5 billion annually in higher health care costs. The pharmaceutical industry contends the deals are not only legal, but actually allow drugs to reach consumers faster than if patent litigation continued.

Also known as reverse payment settlements, the deals emerged as an unintended consequence of the Hatch-Waxman Act that was designed to accelerate access to lower-cost generics. The FTC noted in a 2012 report that the number of deals had been growing and, after the Supreme Court ruling, agency officials vowed to redouble their efforts to scrutinize patent settlements for signs of antitrust activity.

Although the jury verdict was a win for the drug makers, one legal expert says the case may not be over. “This is not the end of the line for the plaintiffs,” Daniel Lev, an intellectual property attorney at Pierce Atwood in Boston writes, “because the district court will next consider whether the jury was appropriate and that decision will likely be appealed.”

 

AstraZeneca, Nektar constipation drug wins European approval
Reuters
8 hours ago

LONDON, Dec 9 (Reuters) - AstraZeneca's new drug for the treatment of opioid-induced constipation, which was developed with Nektar Therapeutics, has been approved in the European Union, the British company said on Tuesday.

The approval for Moventig had been expected after the European Medicines Agency gave a green light for the product in September.

The drug was also approved in September in the United States under the brand name Movantik.

 

AstraZeneca closing U.S. plant, costing 180 jobs
Drugmakers will consolidate Pulmicort production in Sweden and Australia
December 11, 2014 | By Eric Palmer

AstraZeneca ($AZN) has been fighting a losing legal battle to protect the patent on its asthma drug Pulmicort Respules, and a plant in Massachusetts will pay part of the price. The U.K. drugmaker says it will close the plant next year, putting 180 workers out of jobs.

The facility in Westborough will lose some jobs in March and the rest throughout the year with the plant closing by year end, the Worcester Telegram reports. The company said production will be handled by plants in Sweden and Australia.

"We did not take this decision lightly, and it was made after careful consideration of our business strategy, market indicators and the patients and stakeholders we serve globally," spokeswoman Alisha Martin told the newspaper.

AstraZeneca had patents on the drug that it believed were solid until 2018 but last year lost a challenge. It appealed and managed to get an injunction against generics makers, but that has not stopped a slide in revenues from the product in the U.S. Sales were down 6% to $155 million in the first 9 months of this year, even as they have grown in the rest of the world. Sales outside the U.S. were up 15% to $522 million in the first three quarters, with half of that coming from China, the drugmaker reported in its Q3 report.

AstraZeneca has been whittling down the Westborough plant for a decade. In 2004, it had 850 employees and ran 24 hours a day, the Telegram reports. While the U.K. drugmaker is cutting in Massachusetts, it said last month it would add about 300 jobs in Frederick, MD, in a few years after it completes a $200 million plant to expand its biologics capabilities. That project, which starts this month, is slated to be complete in mid-2017.

 

AstraZeneca first-in-class ovarian cancer drug wins EU approval

LONDON, Dec 18 (Reuters) - AstraZeneca's all-important cancer drug business received a fillip on Thursday as a new medicine against ovarian cancer was approved in Europe, making it the first of its kind to reach the market.

AstraZeneca has flagged Lynparza, or olaparib, as a potential $2-billion-a-year seller.

The formal approval from the European Commission had been expected after the European Medicines Agency gave the drug a green light in October but the news is still significant given earlier uncertainties.

In the United States, the drug hit a road bump in June when a panel voted against its accelerated approval. The British company now expects to hear back from U.S. regulators on its approvability in the world's biggest market by Jan. 3.

Lynparza blocks an enzyme involved in cell repair and is designed for ovarian cancer patients with certain hereditary gene mutations. It also has promise in treating other cancers, including breast and gastric tumours, opening up a substantial market opportunity.

The treatment is the first in the so-called oral poly ADP-ribose polymerase (PARP) inhibitor class to reach the market.

Cancer medicine is central to AstraZeneca's claims that it has a strong independent future, after fending off a $118 billion takeover bid from Pfizer in May.

(Reporting by Ben Hirschler; editing by Jason Neely)

 

Everyone agrees that AZ is a very good company and congrats on that. So how is the goofy little bastard Thomas Colarusso working out for ya? What the hell were you thinking? He reminds me of the little turd I knew in eighth grade who kept trying to tell everyone how smart he was compared to everyone else...all the while snot ran down his face and he smelled like an outhouse. Felt sorry for him at first and attempted to take up for him....until I realized that he was an evil little prick that probably had inappropriate relations with his pets.

 

AZ stock hits new historic low. Splitting the stock does not change the value and after today's sell off, there has to be some nervous little shits in the board room. Go Frenchie Go!!!

 

The market was down over 3% today, never mind what happened this week. You really think AZN would be immune to that? Putz

 

Boo hoo! If things go well it is because AZ is so well managed, if things go poorly it is something lease that caused it.

Waah!

Good managements produce good results; poor managements produce poor results.

 

AZ is the only Pharma stock to hit an all time low. Not Pfizer, Merck, BMS, So yes they all went down but AZ has been a constant slide since the Pfizer offer. Not good.

 

Frenchie is to blame for it all, yet he seems to be bulletproof. I don't get it!

 

Incredibly there still is a lot of money propping this company up. Expiries of all major products loom, and there are no replacements. The glory days of AZ are over and the company will end like Lars ended.