With the upcoming overhaul of the U.S. health care market, known as the Affordable Care Act – that’s ObamaCare in common political parlance – it is expected that there will be a drive towards specialization in the pharmacy industry. Looking at recent history we’ve seen the pharmacy majors come out with their Q1 2013 as well as Walgreen Company (NYSE:WAG), AKA Walgreens, and Alliance Boots (Private) receiving regulatory approval to purchase an equity stake in AmerisourceBergen Corp. (NYSE:ABC).
Germany’s second leading pharmaceutical firm and one of the biggest family controlled organizations in this sector Merck KGaA recently released its quarterly results that topped estimates on the back of a cost cutting drive. The pharmaceutical company doesn’t have much attractive in its current pipeline, yet it continues to attract investment because of its unique sales mix — drugs and liquid-crystals, a market whose oversupply problems are finally coming to an end.
Pfizer Inc(PFE), the world’s biggest pharmaceutical company, posted an enormous increase in quarterly profits from $1.4 billion in Q4-2011 to $6.3 billion in Q4-2012 because of the $11.85 billion cash sale of its infant nutrition unit to Nestle. Pfizer completed the sale in November and booked the whole gain of $4.83 billion. The company was also able to lower its costs and expenses and as a result performed better than analysts’ estimates. Excluding one-off items, Pfizer’s adjusted quarterly earnings were $3.52 billion or $0.47 per share which off 6.9% year over year. The company is still recuperating from the loss of patent of some of its best drugs such as Geodon, Xalatan and, of course, Lipitor.
Peter Pham is an author, international fund manager, and a registered financial director by the Cayman Monetary Authority (CIMA). In 2013 he published his first book entitled, The Big Trade: Simple Strategies for Maximum Market Returns. He currently manages the portfolio of a global hedge fund and runs an asset management company, Phoenix Capital. (read more)
The Big Trade: Simple Strategies for Maximum Market Returns
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