Wednesday, February 09, 2005

IN BRIEF: MDS INC.

MDS Inc. will review bioequivalence studies conducted at the company's Montreal facility between 2000 and 2004 to assuage Food and Drug Administration concerns. Last May, MDS Pharma Services received a warning letter from the FDA stating that it failed to properly analyze blood samples during a study of a generic version of Schering-Plough Corp.'s pharmaceutical brand Claritin (loratadine), which led to invalid data being sent to the agency.

Tuesday, August 3, 2004

SCHERING-PLOUGH RESOLVES MEDICAID FRAUD CHARGES WITH AGREEMENT TO PAY $345.5 MILLION; BMS MAY PAY $300 MILLION FOR CLASS-ACTION LAWSUIT

Schering-Plough Corp. reached an agreement with the U.S. Attorney's Office for the Eastern District of Pennsylvania and the U.S. Department of Justice to pay $345.5 million to settle charges that it defrauded Medicaid. Separately, Bristol-Myers Squibb Co. said it would pay $300 million to settle a class-action lawsuit.   Schering-Plough announced it would plead guilty to a single federal criminal charge regarding a payment to a managed care customer and pay a criminal fine of $52.5 million. Additionally, Schering-Plough agreed to pay civil damages to the Medicaid program of $293 million. The total $345.5 million will be paid by March 4, 2005. Some of those damages, though, will be offset by a credit of $53.6 million in Medicaid rebates that the company previously paid.   The agreement resolves the previously disclosed investigation of Schering-Plough's managed care marketing programs that began in 1999. According to The Wall Street Journal, the Justice Department alleged the pharmaceutical firm lowered the price for its allergy drug Claritin (loratadine) for certain health insurers, but not for the Medicaid program. Federal law mandates drug makers offer the Medicaid program the best available price for drugs.   In connection with the settlement, Schering-Plough will also enter into a five-year corporate integrity agreement with the U.S. Department of Health and Human Service's Office of the Inspector General.   The Kenilworth, N.J.-based company still faces an investigation by the U.S. Attorney's Office for the District of Massachusetts regarding whether Schering-Plough paid physicians to prescribe its drugs, and whether it reported inflated wholesale prices to the Medicare program, according to The Associated Press.   Separately, BMS agreed to settle a shareholder class-action lawsuit filed in U.S. District Court in the Southern District of New York related to its development of cancer drug Erbitux (cetuximab) with ImClone Systems Inc.   If the proposed agreement receives final court approval, BMS will pay $300 million, which would terminate the litigation. The company would not admit wrongdoing and the settlement would not resolve pending government investigations and private litigation related to wholesaler inventory issues and other accounting issues. As previously announced, the firm has set aside approximately $470 million in legal reserves.   In March 2003, the New York-based drug firm announced it had overstated revenue from 1999 through 2001 by $2.5 billion because of incentives it offered to wholesalers to build their inventories. The class-action complaint was filed subsequently, alleging investors were damaged by the inflation of the company's stock price due to the revenue overstatements.

Tuesday, July 13, 2004

IN BRIEF: IMPAX LABORATORIES INC.

Impax Laboratories Inc. entered a series of agreements with Leiner Health Products LLC for the supply and distribution of Impax's loratadine orally disintegrating tablets and loratadine and pseudoephedrine sulfate extended-release 24-hour therapies. The treatments are over-the-counter equivalents of Schering-Plough Corp.'s Claritin Reditabs and Claritin-D 24-hour, respectively. Both products are indicated to treat seasonal allergic rhinitis.   Wednesday, August 13, 2003 SCHERING-PLOUGH MAY NEED TO BORROW CASH TO MEET EXPENSES IN SECOND HALF OF 2003

Schering-Plough Corp. may need to borrow money to satisfy domestic cash-flow obligations for working capital, capital expenditures and dividends in the second half of 2003 if such items do not improve over first-half figures, according to a Dow Jones report.   The company said in a filing with the Securities and Exchange Commission, however, that its foreign operations are expected to be able to fund the company's foreign capital needs and expenditures. Schering-Plough does not anticipate having to use foreign subsidiary funds to fund cash flow needs in the United States, but the company did not rule out that possibility if circumstances change.   In the first quarter of this year, Schering-Plough had sufficient domestic cash flow because the collection of accounts receivable offset the firm's decline in sales of prescription pharmaceutical brand Claritin (loratadine), which is now available over the counter. However, in the second quarter, the company delivered a second $250 million payment to the Food and Drug Administration in order to settle allegations of manufacturing violations at four of the company's facilities.   Independent analyst Hemant Shah commented that Schering-Plough's dividend of $0.68 per share could be the first item cut to save money and said that it is "mind boggling" that the cut has not happened already, Dow Jones reported.   Shares of Schering-Plough closed at $16.10, down $0.15, or 0.9 percent, in moderate trading on the New York Stock Exchange.

Friday, July 11, 2003

PRICES FOR 50 DRUGS MOST OFTEN PRESCRIBED TO ELDERLY PEOPLE INCREASED MORE THAN THREE TIMES THE RATE OF INFLATION LAST YEAR

On average, the 50 drugs prescribed most often to senior citizens rose in price almost three and one-half times faster than the rate of inflation last year, according to a new report.   Families USA, a national health care consumer organization, analyzed data from the Pennsylvania Pharmaceutical Assistance Contract for the Elderly program, which filled 9,144,923 prescriptions for a total of 268,005 enrollees in 2002. Price histories for the 50 top-selling drugs in the PACE program were obtained from Mediaspan/First Databank's PriceChek PC database.   Results showed that while the rate of inflation from January 2002 to January 2003 was 1.8 percent (excluding energy), the top 50 drugs prescribed to seniors rose in price by 6 percent, or 3.4 times the rate of inflation.   Among these 50 drugs, 12 did not increase in price, 37 rose in price by at least 1.5 times the rate of inflation and 27 rose in price by three times the rate of inflation or more.   Eight drugs increased in price by more than 15 percent, including Schering-Plough Corp.'s Claritin (loratadine), Upsher-Smith Laboratories' Klor-Con (potassium), Novartis AG's Miacalcin (calcitonin), Wyeth's Premarin (conjugated estrogens), Geneva Pharmaceuticals Inc.'s generic atenolol, AstraZeneca Plc's Toprol XL (metoprolol) and Boehringer Ingelheim GmbH's Combivent (albuterol).   Three brand-name drugs on the list did not increase in price, including AstraZeneca Plc's Prilosec (omeprazole), Pfizer Inc.'s Norvasc (amlodipine) and GlaxoSmithKline Plc's Paxil (paroxetine).   Fifteen generic drugs were among the 50 most prescribed to elderly people. On average, their prices increased less rapidly (2.6 percent versus 7.1 percent) and had significantly lower average annual average costs than brand-name prescription drugs. Nine of the generic drugs did not increase in price.   "These alarming price increases continue to eat away at the fixed incomes of senior citizens, especially those low-income seniors who make up one-third of those in Medicare and who can least afford to pay for their medicines," said Families USA's Executive Director Ron Pollack.

Tuesday, July 8, 2003

SCHERING-PLOUGH WARNS Q2 EARNINGS EXPECTED TO MISS FORECAST

Schering-Plough Corp. shares dropped 3.8 percent after the company said it expects its second-quarter earnings to total approximately $0.12 per share, below analysts' predicted figure of $0.18 per share, according to First Call Corp.   The company earned $0.12 per share in the first quarter of this year; results were affected by the loss of U.S. sales of prescription allergy treatment Claritin (loratadine), which was approved in December for over-the-counter sale.   Claritin had generated annual sales of $3 billion, but the impact of the over-the-counter approval is expected to lower annual sales to approximately $500 million for this year, Reuters reported.   The company's Peg-Intron/Rebetol (peginterferon alfa-2b and ribavirin) combination therapy, indicated to treat patients with hepatitis C, is also facing stronger competition from a newly launched competitor, Schering-Plough said.   Company officials said Schering-Plough is taking action to address the loss in marketshare for its key products, but the processes will take time.   "Our objective for Schering-Plough is to build a solid foundation for growth--it's not about making quick fixes," said Fred Hassan, chairman and chief executive officer of Schering-Plough.   Shares of Schering-Plough closed at $18.34, down $0.72, in heavy trading on the New York Stock Exchange.

Wednesday, May 14, 2003

SCHERING-PLOUGH Q1 NET EARNINGS, REVENUE SINK; CLARITIN SALES TO BLAME

Schering-Plough Corp.'s net income plummeted 71 percent in the first quarter, reflecting the impact of allergy drug Claritin's (loratadine) approval for over-the-counter use in late November.   The firm earned $173 million, or $0.12 per diluted share, in 2003 compared with $600 million, or $0.41 per share, in the same period last year. Analysts polled by Reuters Research expected average earnings of $0.10 per share in the quarter.   Quarterly revenue fell 19 percent to $2.1 billion from $2.6 billion in 2002.   Worldwide sales of Claritin were $109 million in 2003, a sharp drop from sales of $659 million in 2002. Furthermore, U.S. sales for the prescription drug were $16 million in the quarter versus $565 million in the prior-year period.   Chairman and Chief Executive Officer Fred Hassan said 2003 is a "transition year," but the firm "will succeed in delivering the turnaround and getting on a track of solid, long-term growth."   Schering-Plough withdrew its prior guidance that full-year earnings would be between $0.79 per share and $0.85 per share.