Pfizer Continues to Fall Further 29 comments
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Blog reader Jim Mooney emailed me yesterday saying I'm biased against Pfizer (PFE). He wrote:
You continue--day after day--to knock the company at every opportunity. I understand you had a difficult relationship with the CEO before, but you shouldn't hold a grudge against the company for it. A fair reporter like yourself should always be impartial. As a long suffering PFE shareholder, I would appreciate if you FINALLY (the caps are his) said something positive about PFE.
Jim, I'm just reporting what's happening in the market. And when shares of the world's biggest drug company continue to hit nearly 11-year lows, even on a day like today when the rest of the sector is rallying, and The Wall Street Journal does an article this week about the PFE dividend possibly being at risk, that's a story. Executives have said the big dividend (between a six and seven percent yield) is safe, but investors appear to be worried that it might not be.
And then to make matters worse, this morning James Kelly at Goldman Sachs took Pfizer off of the "Americas Conviction List" and added Eli Lilly (LLY) to replace it. That's on top of a Cowen and Company upgrade of LLY yesterday.
Kelly is downgrading PFE from Buy to Neutral (Hold) and upgrading LLY to Buy from Neutral. He also eats a little crow in his research note to clients. "Since Pfizer was added to the Americas Buy List on January 4, 2007, the share price has fallen 28.7 percent, versus a 2.9 percent decline in the S&P 500 and a 20.4 percent decline in our coverage universe," Kelly writes.
But wait, there's more. "Since the shares were added to the Conviction List on October 24, 2007, they have gone down 21.6 percent versus a 9.1 percent decline for the S&P 500, and over the past 12 months, the share price has declined 31.7 percent compared to a 10.5 percent fall for the S&P 500," he adds.
Kelly likes PFE's valuation, although he's dropping his price target from $26 to $22. But he has fundamental issues. "Near-term pipeline products decrease in value and recent safety issues pressure our Chantix and Sutent (a cancer drug) forecasts. Further, the key launches in the base business have begun to deteriorate (notably Sutent, Chantix and now potentially Lyrica), which is important to our view." Lyrica is a drug for nerve pain and fibromyalgia.
GS has done and wants to do more banking for Pfizer and Lilly . It also makes a market in the shares of both companies. And a retired GS Vice-Chairman sits on the PFE Board.
And, oh, Mr. Mooney, I think Pfizer Chairman and CEO Jeff Kindler and I are just fine.
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Regarding the comment by Fedup Investor about the business problems of PFE, the company is in a rut because it doesn't have a pipeline. Problems with Pfizer's pipeline were evident six years ago. Based on the current price, Pfizer looks to be in a much better position for investors today. I would like to see the price drop lower. I would be surprised if the price drops below $15.
The other issue, quite frankly, is that the mid-90s was a strange time in the history of drug approvals. The approval process of the FDA was changed thanks to PDUFA. PDUFA triggered a rash of approvals in the mid-90s, a spike. Few people at the time commented that this spike wasn't sustainable for the long-term. Approvals dropped off in the past few years because, frankly, fewer candidates were presented to the FDA though the NDA process. The successes in the last decade have raised the bar for both safety and efficacy for many indications.
The other thing that occurred was that there were some high profile--and highly effective--drugs launched in the areas of cardiovascular and anti-infectives. In fact, there were new and effective drugs in a host of areas, thanks in part to technologies that came on stream a decade earlier. As Fedup Investor pointed out--and it can't be stressed enough--the discovery cycle is long. It's also uneven, benefiting from new technologies and, for that matter, sporadic financing events--more on this topic in a moment. The 90s was a very fruitful time for new drug applications.
FrankieJay, I certainly think that management should always be implicated in the success or failure of a company, but I disagree that the problem is as simple as pedigree. To me the fact that the top person comes from outside the industry isn't relevant. I look for intelligent people, with a record in management, that can analyze problems and come up with solutions. A training in the industry could be desirable, but isn't always necessary.
To The Real Expert, while yet another Pfizer share buyback program might help bolster the price of the share, it doesn’t tackle the fundamental issue of an anemic pipeline. Having a successful pipeline and paying dividends aren't mutually exclusive--companies, including Pfizer, have managed it in the past. For the past sixty years, there has always been a cyclical component to the quality of Pfizer’s pipeline. With regard to a buyback, the decision has to be made as to where one gets the best return. The stock may be cheap, but there could be other ways to spend cash that offer a better return than buying back one billion shares. Pfizer has announced share buyback programs in the past--rather large ones too--and will probably do so in the future. While a share buyback program might bolster the stock price, it doesn't address the underlying issue of a pipeline--that's where the problem lies.
worth asking, good question. Many people argue that, right now, we're seeing what Pfizer is worth without Lipitor. The loss of Lipitor is huge for Pfizer and it doesn't appear to have a solid Plan B! The demise of Lipitor is one reason that the stock price is floundering. I see two issues with Lipitor: one is the chemistry to make the molecule and the other issue is its excellent safety/efficacy profile.
The molecule isn't easy to make. It has one intermediate, a building block that has fairly complex chemistry: chemistry that many manufacturers will find difficult to copy. The chemistry involves low temperature reduction (adding hydrogen) and it has to be done in a very specific way. Warner Lambert, the innovator, actually built a plant in Ireland to make this intermediate. Patents have been filed to protect that synthesis, though the validity of one key patent is under attack and has been squashed in a few countries outside the US. There's another way to make the intermediate using enzymes, which has the potential to significantly lower the cost of the drug. In any event, when Lipitor comes off patent, the news isn’t good for Pfizer.
Pfizer has really brought the cost of goods for Lipitor down to a remarkably low level--some people estimate that it's 1% of the selling price. Revenues for Lipitor will be attacked and likely slashed, but Pfizer is in a better position to compete on price than are many other branded drugs that make the perilous journey into the off-patent arena.
Generic versions of Lipitor are ready to go. One Indian company has tried, unsuccessfully, to fight Pfizer in court. I'd love to know its cost structure to manufacture the drug (they may have come up with an enzymatic route to the key intermediate that is non-infringing--that would be big).
The other issue for Lipitor is its safety/efficacy profile: it appears to be a relatively safe drug that is very effective. It might be a long shot, but I would not be surprised if, after the patent in the US expires and a non-branded version appears on the market, the FDA moves the drug to OTC status. Being able to buy Lipitor and its generic competitor without a prescription, if handled correctly, may be good news for Pfizer.
The solution for Pfizer isn't a share buyback program; it's a shore up the pipeline program. The way to do that is to buy pipeline from emerging companies. Today, Pfizer and other major companies are in an excellent position to purchase some Phase III drugs on the cheap.
Some background: shortly after the peak of the dot.com bubble, money started to pour into emerging pharma--referred to as "biotech" on Wall Street. In fact, biotech has had a few intermittent waves of financing. When things look good--as they did around 2000, money pours in through secondary offerings. We're now seeing the benefits of that latest round of financing as pipelines in biotech look pretty good. I commented elsewhere that, in the contract manufacturing world, pilot plants are full, which augurs very well for future NDA filings. Pfizer could spend two to three billion dollars and merge into a half dozen or so emerging, small molecule pharma companies with very promising pipelines. It could give the company an additional half dozen drugs in phase III, eight to twelve in phase II and fifteen to twenty-five in phase I.
Of course, the key term here is “promising.” There is inherent risk of failure when it comes to drugs in the clinic, even those that have made it all the way to phase III. However, companies in the industry operate with the maxim of safety in numbers. All else being equal, more is better.
Clanger, while RNAi looks promising, I certainly don’t regard it as a panacea. There are a lot of interesting programs out there using different technologies. RNAi is just one.
BlueOkie, no one knows what a universal healthcare program could do. The one thing it won’t do is kill the pharmaceutical industry. If anything, the program is designed to bring more people into the system, that’s good.
Things have developed in the last week. You may not be aware of it but John Zaia of City of Hope has recently presented data to show that they may have a cure for HIV.
www.asx.com.au/asxpdf/...
Further, there is only one company that has priority for ddRNAi in humans. It is Benitec and Pfizer know it. Fire and Mello with their proxy attack dog Nucleonics have tried to overturn the patent but have failed thus far.
Rumours of a Merck takeover last year sent the price up 700% in thirty minutes. Merck had used their IP for nearly 12 months prior. Mercks largest shareholder is Bill Gates whose interest is HIV. Their in vivo and in vitro data said that it worked like a dream (it does) and they wanted it to compliment their Sirna acquisiton. The bid failed.
Enter PFE.
They took a research only licence the day it went 700%. That is what forced Mercks hand. Now after 18 months of research they now know what Merck knew; it works.
As a result they are working hand in hand with Benitec to provide second and third generation pipeline depth.
But more than that PFE is going to buy the entire biotech industry of Australia to get its pipeline and merge with or acquire Merck.
I challenge Huckman to make enquiries on these matters but I doubt he will. He seems to prefer to carry on stating the obvious. It is equally obvious to me that the US pharma has no publicly declared strong position with regards to RNAi and the question is why not?
I haven't a clue what you mean by "has priority for ddRNAi in humans."
I think you're speculating on Bill Gates and possible ownership of shares of Merck. The company did partner with his foundation. How do you support the claim that he is a major shareholder in Merck?
You're reading way too much into any involvement that Pfizer or Merck has with Benitec. Major pharma enters into agreements with all kinds of emerging companies. What you're seeing isn't significant.
That is why I challenge Huckman to make the enquiries.
Priority in humans is all about patent issues.
How I know might just be a bridge too far.
You're making your comments it would appear with sound familiarity of Benitec and the relationships it has.
You will also be aware of Alnylam then and the option agreement each has with the others IP.
Benitec has a claim to Alnylams IP in five different disease types on an exclusive basis and vice versa. Which means that when you buy Benitec you also get access through to Alnylam. The deals Alnylam have done are on a non-exclusive basis.
www.asx.com.au/asxpdf/...
You also get exclusive access through to Calando. A Vertex subsidiary.
So please, if you are as good as you reckon you are at biotech investing, please don't look at Benitec on an isolated basis.
This is why we have seen Europe and Asia move on Alnylam on a non-exclusive basis in some disease types and the Americans are keeping their business with Benitec out of sight.
Benitec is worth $25m Au and listed on the pink sheets. Alnylam is worth $1.1bn US. By buying BLT you are buying in to Alnylam as well and Pfizer and Merck know it.
Mr Huckman has been challenged.
I must add, with early data that suggests they have HIV beat with a probable fast track through the FDA process.
And you think Bill Gates isn't interested in that?
What you're doing here is speculating. You may even be trying to hype a penny stock.
"I must add, with early data that suggests they have HIV beat with a probable fast track through the FDA process."
No news here. Early data on hundreds of programs looks revolutionary. Fast track isn't that impressive either--all you have to do is ask. The early data you're talking about is on a few patients--very preliminary indeed.
"And you think Bill Gates isn't interested in that? "
That's not the point. You stated that Bill Gates is the largest shareholder in Merck. Present your evidence.
There is no speculation when you see Pfizer taking an equity stake in Tacere. A company founded with Benitec's previous management team using their IP. That's a fact by the way.
Second fact is that US pharma has no significant presence in the one of the greatest scientific breakthroughs of the last century. It is comparable to splitting the atom and its effects will be just as profound and not just in medicine.
Third fact is that by buying Benitec you get an exclusive option on five disease types using Alnylam's IP.
Fourth, European and Asian pharma has seen fit to pay up to $100m cash and sign two $1bn deals with options for more just to use this IP on a non exclusive basis.
What does that make exclusive use worth when a single disease blockbuster falls in the vicinity of $10bn? Benitec is the only company in the world with this option.
Fifth fact, Alnylam recognized early on that Benitec has fundamental ownership of IP in the RNAi spectrum and saw the need to agree to the option. Their patent has withstood intense scrutiny so far at the USPTO and in Australia's equivalent. Their entire patent estate amounts to approximately a full one third of all RNAi patents issued.
But somehow, I think you already know all of this.
I agree early data looks promising on hundreds of projects. But there is only one ddRNAi HIV project underway worldwide and so far RNAi is living up to its promise. It is groundbreaking stuff.
As a biotech investor willing to charge for his "expertise" I suggest you either provide free access to your site or up your game.
Finally, the point of this little exercise has nothing to do with Bill Gates' position in Merck. It is to show that Mr. Huckman's continual disparaging of Pfizer shows his ignorance of real developments in the pharma - biotech space. Or at least his preference to appear ignorant.
Now it could be said he is no longer ignorant and if he continues disparaging PFE or does not choose to at least enquire in to these comments of mine it will show the true journalistic integrity of the man and his employer; Pfizer's doppelganger.
But I don't expect Mr. Huckman to rise to the occassion. It is more an exercise to satisfy my own curiosity.
So I have no expectations that he will do anything else other than carry on ignoring the facts about where Pfizer are going while concentrating on denigrating them for the obvious.
But anyone reading this will get an idea of what he is really all about.
Conclude what you will--whoever you are. If you read what I wrote, you shouldn't see an ulterior motive. I am pushing nothing--certainly not trying to hype a small biotech company that is in no way related to this thread!
"There is no speculation when you see Pfizer taking an equity stake in Tacere. A company founded with Benitec's previous management team using their IP. That's a fact by the way. "
Pfizer is involved in a development deal with Tacere, but that has nothing to do with the company mentioned by clanger in previous posts.
"Second fact is that US pharma has no significant presence in the one of the greatest scientific breakthroughs of the last century. It is comparable to splitting the atom and its effects will be just as profound and not just in medicine."
Garbage. Your statement is piffle. State an argument, not hollow hype. This is a site for investors.
"Third fact is that by buying Benitec you get an exclusive option on five disease types using Alnylam's IP."
No one is buying Benitec, at least not yet. Where does this statement come from?
"Fourth, European and Asian pharma has seen fit to pay up to $100m cash and sign two $1bn deals with options for more just to use this IP on a non exclusive basis."
You need to examine those deals. The deals *could* be worth as much as one billion dollars--not currently! There are many, many deals out there that, if a drug becomes a blockbuster, could turn into billion dollar deals. Few deals ever get that far.
"What does that make exclusive use worth when a single disease blockbuster falls in the vicinity of $10bn? Benitec is the only company in the world with this option."
Hype.
"Fifth fact, Alnylam recognized early on that Benitec has fundamental ownership of IP in the RNAi spectrum and saw the need to agree to the option. Their patent has withstood intense scrutiny so far at the USPTO and in Australia's equivalent. Their entire patent estate amounts to approximately a full one third of all RNAi patents issued."
More hype!
"But somehow, I think you already know all of this. "
That's a strange statement. How? How can you know something like that?
"I agree early data looks promising on hundreds of projects. But there is only one ddRNAi HIV project underway worldwide and so far RNAi is living up to its promise. It is groundbreaking stuff."
Yawn. Promising results happen with every new technology. I see nothing to get overly excited about with the current reports on RNAi.
"As a biotech investor willing to charge for his "expertise" I suggest you either provide free access to your site or up your game."
I guess if you don't have an argument, attack the person. It's a classic obfuscating technique. I don't charge anyone for expertise. I don't give investment advice. I give opinion.
"Finally, the point of this little exercise has nothing to do with Bill Gates' position in Merck. It is to show that Mr. Huckman's continual disparaging of Pfizer shows his ignorance of real developments in the pharma - biotech space. Or at least his preference to appear ignorant."
Yes it does. The person writing as clanger stated that Bill Gates is the largest shareholder in Merck. Where's the evidence? It's a simple question triggered by a simple, clear, unambiguous claim. Where is the evidence?
Regarding the attack on Mr. Huckman, why not point out where his argument is weak. Deal with facts. It you have to attack someone personally, you don't an argument. If you read his article, he wasn't attacking Pfizer; he was reporting.
"Now it could be said he is no longer ignorant and if he continues disparaging PFE or does not choose to at least enquire in to these comments of mine it will show the true journalistic integrity of the man and his employer; Pfizer's doppelganger. "
I think that if you read the other posts attributed to clanger, there's no real substance on which to base any sort of journalistic investigation. The posts are peppered with poor arguments, lack of intellectual restraint and misstatements. There's a credibility issue with the posts of clanger.
"But I don't expect Mr. Huckman to rise to the occassion. It is more an exercise to satisfy my own curiosity."
Really! I guess I'll have to take you on your word.
One more time: if you can't offer an argument, attack the person. You have no basis for your conclusions. For your statement to make sense, one has to conclude that the author of the e-mail didn't give permission to have it posted. You don't know that.
"So I have no expectations that he will do anything else other than carry on ignoring the facts about where Pfizer are going while concentrating on denigrating them for the obvious. "
For the obvious what? Your argument doesn't make sense in that you or clanger haven't stated that facts that are being ignored. You have presented speculative statements and hype about emerging biotech companies but no facts.
I haven't seen denigration of Pfizer by Mr Huckman. I have seen some nice reporting.
The pipeline problem is not one of lack of funds. They have plenty for R&D. The fact is that pharma companies spend twice as much on sales and marketing than for R&D. For PFE to drop $8 billion (and growing) each year on dividends appears to be more of a gradual liquidation of the company than anything else. Regardless how well PFE might do (which at best will take many years for positive results) nearly 7 billion shares is way too much. It is extremely difficult for any company to achieve sufficient earnings growth to be categorized as a growth story with that many shares.
The real solution is surely not a share buyback but it must be addressed regardless what happens, even if the pipeline improves. In no way did I ever imply that would be the ultimate solution. But a share buyback is the easiest way PFE can cushion decelerated earnings while it fills teh pipeline.
The real solution is not so much pipeline but strategic direction. Big pharma needs to stop focusing on these useless me-too drug clones and go back to developing the kinds of breakthrough drugs that made them successful. They need to build a pipeline of better, safer, more useful drugs. If they do that, they won't have the need to spend twice as much on sales and marketing as R&D. Quality breakthrough drugs sell themselves because they are good. Poor drugs need massive marketing and bribes to physicians.
Just because you call yourself "bioinvestor" you should not assume others who post are not more knowledgable in bio investments than you. My core expertise is biopharma, with strong academic credentials and Wall Street experience in this sector. If I were not an expert, I would be talking about the obvious variable that will take many years to resolve and which everyone already knows about - pipeline issues.
TRE, it will be resolved overnight.
PFE will be buying pipeline by buying the bulk of Australia's biotech sector with the use of PIPE's and the keiretsu model for business.
Biotech does not suit the CAPM for business. A distributed but simultaneously integrated model for business is better.
It will come out of the woodwork soon enough and anyone reading this will get to find out that Huckman's journalistic integrity is as callow as Biotech investors "opinion".
But if Huckman wished he could ask a few questions and get his scoop....but he won't.
rnaitherapeutics.blogs.../
"Finally, Benitec’s HIV program is another program that deserves some attention as quantitative patient data may emerge relatively soon; for example, an expansion of T-cells derived from the stem cells transduced with the lentiviral vector encoding for a triple-RNA antiviral relative to unmodified cells would be very promising. "
TRE, thank you for those moderating and insightful comments.
I think it is fair to say BioInvestor is a hired guard dog whose purpose is to quash any dissenting opinion from the masses. The incongruity of charging for entry to his website to obtain "opinion" while offering the same here free of charge is just too great. Especially when it is against all accepted views of the scientific community.
Mr. Huckman has his chance to get his scoop but when the day comes, readers will remember this blog while making their own minds up about his journalistic integrity.
The spend on R&D and marketing are two different topics; I think it’s fine to compare them, but, when it comes to Pfizer, I don’t see any value in going further than that. I also don’t see how shares outstanding relate to being a growth company. If I look at Pfizer’s earnings and sales over many years, it has a cyclical component. My focus is on sales and earnings growth. I am not that influenced by how finely divided those earnings become when an EPS calculation is carried out.
While it’s always nice to get a little bump from a share buyback program, I agree with you that it’s not a long-term solution. I certainly agree that pharma, in general, needs to focus its efforts on actual, historical diseases that plague humanity. I am always amused by how pipelines were described in the 90s, as addressing the “three H’s”: making people happy, hairy and, shall we say, Viagra addressed the third H. Cancer, which frankly didn’t feature as prominently in pipelines in the 90s, has made a comeback today. Another example is HIV, where I think pharma made a stellar progress in a short period of time on what, at one point, appeared to be an almost intractable problem. Interestingly, quite a lot of the successful R&D effort was carried by emerging pharmaceutical companies. Which brings me to the next point:
Strategic direction is one thing, but it’s not the issue in my opinion. Frankly, the answer to Pfizer’s problems is a better pipeline. A better pipeline can be bought. Emerging companies are cheap right now. Pfizer needs to continue to merge into these companies. I don’t know if you survey contract manufacturers, but they’re doing extremely well right now. Pilot plants are full. It augurs very well for the future health of the industry.
I don’t agree with the assessment of follow-on or “me too” drugs. There’s a place for such drugs. All drugs need marketing; it’s a fact of life. I don’t see marketing and R&D as being in competition.
Your last paragraph surprised me, since you make an assumption that isn’t valid. I don’t assume that people aren’t more knowledgeable that I. I also don’t care about someone’s background or credentials. I make an assessment on what they write, not on who they are. I disagree with what you wrote. I think your statement on dividends is incorrect; I think the core issue is pipeline.
In case you didn’t read recent posts, let me bring you back to your statement about Bill Gates and his ownership interest in Merck: please cite where I can verify your claim that Bill Gates is the largest shareholder of Merck & Co., Inc.
In an easier to understand version let me explain...for free.
An emerging disruptive technology called immunology is about displace a large multibillion dollar industry in cancer called chemotherapy.
Some people don't like that because they will lose their market positions, jobs etc.
Because it is still emerging it can't displace it entirely in one go. Therefore it will work as an adjunct to chemo.
Ergo, big pharma must move towards this sector to survive.
The question is how. BioInvestor, that is a strategic matter. Not important for you though is it?
The leaders worldwide in immunology are the Australians. RNAi is second generation immunology. Fundamental IP in RNAi is owned by Alnylam and Benitec. Each have an option on the others IP. Alnylam is owned by the Europeans (Roche). Benitec by the Americans (Pfizer). Its not public yet.
To overcome pipeline matters Pfizer want to fill it with oncology therapeutics founded on immunology.
They don't want to buy companies whole. Instead they will partner them by taking cornerstone stakes through PIPE's. They will build a keiretsu model for business. An extrapolated model of the Roche/Genentech arrangement right through to pre-clinical and they will even provide funds for the "valley of death" from discovery to commercialization.
Over the last three years, Pfizer agents have gone around and selectively partnered with valuable companies. Including Benitec, Progen, Psivida, Pharmaxis and quite a few others. Some are on the NASDAQ, some are on the OTC and others on the pink sheets and others only the Australian exchange.
One day soon, real soon, they will announce their positions in these companies and the pipeline problem will be resolved.
How do I know Bill Gates was a holder of Merck? Because someone told me. That is all a fool like you needs to know. He might not be now though. Something had to cause the price collapse and it could well have been him selling out.
Thats $150 for you. lol
And while Huckman is happy to publicly ridicule people who email them, soon we will all get to see the quality of his journalism for the professional turpitude it is.
Once again, you make inaccurate statements and unsupported claims. For example immunology isn't a technology. It's more appropriate to view it as the science of the immune system.
There are practitioners in the field in many different parts of the world. I don't know you can determine that those who lead in the field are in Australia.
Your statement that Pfizer owns Benitec is not true. Pfizer may merge into the company in the future, but if you're claiming prior knowledge about an impending transaction, I don't believe it.
Pfizer does merge into companies--take a look at the company financials. It happens many times. All major pharmaceutical companies enter into various partnerships with emerging companies. They're not in the business of forming something akin to a keiretsu. The relationship between Roche and Genentech doesn't resemble a keiretsu. You can read about the relationship in the public filings of Genentech. It's a standard business relationship.
As I pointed out, all major pharmaceutical companies enter into various business arrangements with emerging companies--major biotech companies do too. It's not news. It's not significant. For a public company, if the activity is material, it's also not secret!
Thanks for the update on Bill Gates' ownership in Merck. It answers the question that I needed to know.
Time will show it as so.
Over and out.
“Although we were disappointed by the performance of Amgen and Pfizer, we remain optimistic about the healthcare sector and pharmaceuticals in particular. The major pharmaceutical companies boast above-average long-term growth prospects, as the emergence of a global middle class produces significant demand for pharmaceuticals. The companies maintain enviable balance sheets, and relative valuations for the sector are at historical lows. We also expect these companies to benefit from a dramatic increase in pharmaceuticals use by the aging baby boomer generation. People over the age of 65 are consuming an increasing amount of prescription drugs per capital, and this consumption is relatively insensitive to the economic cycle. Despite these unusually favorable prospects, large pharmaceutical stocks such as Eli Lilly and Novartis trade at market-like valuations.”
I am quite certain the short-term prospects for the company will be dismal; but right now there is a "fire sale" going on at some of the major pharmaceutical companies. Valuations are the most attractive they have been in years. People foolish enough to read your article and believe your empty assertions; will lose a ton of money if they sell companies like the worl's largest biomedical and pharmaceutical company for penny's on the dollar. Don't believe the hype folks, people like Buffett are slowly building large positions in pharmaceuticals & managed care companies. My personal favorites are: SNY, GSK, PFE, GE (they are entering medical technology research although I would wait for a more attractive entry point at this time. As for Eli Lilly, it's an interesting company and has a fair valuation but at the numbers below you won't make as much money as you would with the companies I mentioned above.
Eli Lilly
Price/Book (mrq): 3.77
Enterprise Value/Revenue (ttm)3: 2.89
Enterprise Value/EBITDA (ttm)3: 9.201