Tuesday, July 29, 2014

More -- On "Adult CEO Perspectives" For US Corporate Tax Rate Policy Reform

In a second stark moment of contrast (compared to brother Pfizer) on a single morning, CEO Frazier made it clear that Merck would not be likely to pursue a deal of size, near term -- and certainly not an inversion.

Recall that Ian Read pretty much whacked the proverbial hornets' nest, on inversions, earlier this year, when his unwelcome, north of $100 billion advances, upon a British old line pharmaceutical house were. . . soundly rebuffed.

And do recall that Mr. Frazier was the voice of reason, then too. From Bloomberg reporting, a bit ago, then -- do go read it all:

. . . .Merck is not interested in large scale purchases that are “very time consuming and distracting to what we’re here to do, which is invest in new medicines,” Ken Frazier, Merck’s chief executive officer said in an interview today. Merck also isn’t looking for a cross-border deal to lower its tax rate, he said.

Instead, “we’re trying to get Congress to look at how all U.S. firms are at a huge disadvantage” and encouraging tax reform, Frazier said by telephone. . . .

Yes -- it is. . . refreshing to read some sober, balanced and mature analysis of US corporate income tax policy -- from a public company CEO and Chairman. That much is certain.

L'Oreal Sunscreen Patent Battle: POSTPONED -- Due To Sale Of Biz, To Bayer

I was rather busy last week, and so didn't get to this -- at all.

My apologies. But the battle over L'Oreal's patents -- against legacy Schering-Plough Coppertone branded products -- will now likely be handed off to Bayer. Afterall, Bayer may wish to surrender, settle, or battle on, and Merck should probably not be making those sorts of tactical decisions, any longer -- on Bayer's behalf. [This will also delay the companion trial, Case No. 12-98, L'Oreal has pending against J&J.]

From the minute order entry, in Delaware federal District Court:

. . . .Minute Entry for proceedings held before Judge Gregory M. Sleet

Telephone Conference held on 7/29/2014.

Discussion on the status of the case as listed in Joint Agenda Letter. The Jury Trial in this matter scheduled for 9/29/2014 has been POSTPONED.

The parties shall file a Proposed Amended Briefing Schedule by 8/8/2014. Counsel shall follow the court's directives as discussed. The court will set a Teleconference in C.A. 12-98 to discuss a new trial date. . . .

Of course, J&J was battling Merck (as successor to legacy S-P) -- in the last iteration of this war. Now, they are both being bludgeoned (in a purely-figurative sense) by L'Oreal, in no small part on the basis of evidence adduced in the earlier battle between Merck and J&J, inter se -- and made public record in Delaware. Ironic. There are some other issues that may delay the twin trials, as to the L'Oreal patent claims themselves, but this will no longer be on Merck's tab -- very soon. And that too, is good news for Whitehouse Station. Now you know.

A Very Solid Q2 2014: Revenue And EPS Both Slightly Higher Than Expected; Merck's Full Year Hints At Slight Upside (Nice Contrast With Pfizer, Here!)

To be sure, these are not the heady days of yore, in big pharma. [Exhibit A? Pfizer just reduced its full-year 2014 global revenue guidance.] Just the same, between expense management, and some reduced currency headwinds, Merck is making nice headway. And. . . to be sure, Whitehouse Station is "getting there" -- in no small part -- by aggressively reducing headcounts, especially in US salesforces.

Even so -- I take my hat off to Mr. Frazier. He's done a very good job -- of piloting this massive enterprise, toward a more nimble future incarnation. That's his vision. Surprisingly, at least in the Remicade®/Simponi® franchises, currencies added a five percent tailwind. Overall, currencies were a net-neutral. [Even with the Venezuelan devaluation. . . fascinating -- must be some smart hedging underway.] Okay -- let's get to it, then -- from the presser:

. . . .Worldwide sales were $10.9 billion for the second quarter of 2014, a decrease of 1 percent compared with the second quarter of 2013, with no net impact from foreign exchange. . . .

Second-quarter pharmaceutical sales declined 2 percent to $9.1 billion. Expected declines occurred due to the ongoing impact of the loss of market exclusivity for TEMODAR (temozolomide) and NASONEX (mometasone furoate monohydrate). Additionally, sales from the hepatitis franchise of VICTRELIS (boceprevir) and PEGINTRON (peginterferon alfa-2b) declined as a result of increased competition. These declines were partially offset by growth in REMICADE (infliximab), SIMPONI (golimumab) and ISENTRESS (raltegravir), as well as the cardiovascular franchise of ZETIA (ezetimibe)/VYTORIN (ezetimibe/simvastatin) and the diabetes franchise of JANUVIA (sitagliptin)/JANUMET (sitagliptin and metformin HCI).

Combined sales of JANUVIA and JANUMET, medicines that help lower blood sugar levels in adults with type 2 diabetes, grew 2 percent to $1.6 billion in the second quarter. The growth reflects higher sales in Europe and the emerging markets, which were partially offset by declines in Japan. Sales in the United States decreased 1 percent.

Combined sales of ZETIA and VYTORIN, medicines for lowering LDL cholesterol, increased 6 percent to $1.1 billion in the second quarter, including a 1 percent positive impact from foreign exchange. The growth was driven by higher sales of ZETIA in the United States, reflecting wholesaler purchases and price increases.

Combined sales of REMICADE and SIMPONI, treatments for inflammatory diseases, grew 21 percent to $781 million in the second quarter, including a 6 percent positive impact from foreign exchange. . . .

Other (income) expense, net, was $558 million of income in the second quarter of 2014, compared to $201 million of expense in the second quarter of 2013. The second quarter of 2014 includes a $741 million gain recorded in connection with AZ’s option exercise.

The GAAP effective tax rate of (7.5) percent for the second quarter of 2014 reflects the impacts of acquisition- and divestiture-related costs and restructuring costs, as well as a net benefit of $517 million associated with AZ’s option exercise. The non-GAAP effective tax rate, which excludes these items, was 24.2 percent for the quarter. . . .

All of that said, it puzzles me that Vytorin®/Zetia® sales rose slightly (1 per cent), even inside the US (more precisely, Zetia was up 4 per cent, while Vytorin was off 4 per cent). By later in Q4 2014 -- I expect to see IMPROVE-IT data which will likely declare the drugs. . . non-meaningful, as to outcomes. Apparently, some US formularies are restocking the drug, accounting for the bulk of the uptick. But, as ever, we shall see. Overall, a solid performance in the quarter. Onward!

Monday, July 28, 2014

$100 Million NuvaRing® Settlement Proceeding, Right On Schedule -- Next Status Hearing On October 23, 2014

It would seem that receipts, accepting the claimants' completed claims notice packages, should be in the mail in just a very few weeks, now.

And starting at the beginning of August, plaintiffs NOT accepting the global settlement will need to comply with individual deadlines in their cases -- a tall order. So I expect there will be very few who will decline the NuvaRing® settlement. We shall, as ever, see -- but Merck did engineer a nice bargain here, in settling. From last Friday's order, then -- entered by Judge Rodney W. Sippel in the Kansas City federal District courthouse:

. . . .Pursuant to the status conference held this day, the Court is advised by the parties that the NuvaRing Resolution Program is proceeding as planned. Claims packages have been submitted and are being processed by the parties and the claims administrator.

The Court advises all parties that as of July 31, 2014, the stay in this litigation will expire and will no longer be in effect, and the time for compliance with all pre-trial deadlines set forth in the Court's Order Regarding Preservation of Records and Prima Facie Evidence of Usage, Injury and Causation Requirements for Pending Cases Not Participating in the NuvaRing Resolution Program and Newly Filed or Transferred Cases, entered February 7, 2014 (Doc. #[1680]) will begin to run as of that date for cases not participating in the NuvaRing Resolution Program.

Signed by District Judge Rodney W. Sippel on 7/25/14. . . .

We will be up early -- for the earnings call, tomorrow. Sleep well!

Merck Reports Q2 2014 Earnings Tomorrow. . . What To Expect?

I'll guess that revenue will be a little light; bottom line will be on target for the year -- and currencies will have taken about 1.7 per cent to 1.9 per cent from global sales. Per Forbes reporting, then:

. . . .Despite not changing over the past month, the consensus estimate is down (to 81 cents) from three months ago when it was 84 cents. For the fiscal year, analysts are expecting earnings of $3.49 per share.

After being $11.01 billion a year ago, analysts project revenue to drop 4% year-over-year to $10.61 billion for the quarter. For the year, revenue is projected to roll in at $42.57 billion. . . .

See you an hour before NYSE open, tomorrow, then.

Sunday, July 27, 2014

Sunday Reflections: Whither The "Pharma Rep" (Or Detailer) Old-School Sales Career?

With local Philly-area media noting that some 5,000 more positions are yet to be eliminated -- during 2015 -- at Merck (and we all have likely surmised that the bulk of those are likely to be detailer jobs), I decided to take a moment to ask whether the position should exist, at all. [And I won't belabor the point, but those 5,000 are on top of perhaps 35,000 over the last four years -- at Merck and legacy Schering-Plough, in the aggregate -- reflected industry wide, too.]

Right at the top, let me say that I mean no disrespect to the smart, creative, hard working and honest men and women who presently perform this role, at various pharmaceutical and biotech companies around the United States. I simply know that -- even in the last seven years -- with the advent of a more universal system of health care reimbursement coverage (and especially in the last two years), we are witnessing a vast consolidation of purchasing power -- consolidation, into the hands of an acceleratingly small number of payers -- each of which is increasingly weilding more price negotiating power. So, I must ask (but not too-quickly suggest an answer), is it even wise to try to influence the doctors' decisions by direct visits, from often fresh faced, well-informed (albeit with a pro-drug perspective) mostly young people? [Tell me what you think, in comments.]

It would seem that in hundreds of cases, if one were to read CafePharma, at least -- the "sales" people themselves believe that job has largely become a lunch or breakfast catering-to-the-clinic-staff role. Literally getting them Starbucks, or Chipotle, on an every other week basis -- in the hopes of being able to schedule a few minutes every three or four months -- to chat up the doctor. And to get signatures for the samples delivered, as formerly just required by HQ (and now required by regulatory imperatives). Given that so many doctors now will write primarily the 'scrip the payer is willing to reimburse most completley (for the resource constrained patient), should Merck even be spending on what may amount to a "nation-wide catering and delivery" operation?

To be clear, we all know that industry-sponsored CME events, and opinion leader talks, even if digitized (as at right) -- with doctors talking to other doctors -- remain effective in influencing prescribing patterns. What I am increasingly skeptical about, however, is whether the detailers' calls, made mostly upon staff and nurses, and in many cases, to deliver donuts, coffee, or lunch, really adds enough to Whitehouse Station's US revenue -- to be continued. Sure, some offices will complain when the free food stops arriving -- but will a doctor really decrease (or increase?) his/her prescribing patterns, with- or without the free Subways? I have no idea. But I'd bet that the data is driving these remaning 5,000 job cuts. And it is industry-wide.

Finally, as a housekeeping matter, I should politely indicate that the appearance of the rapper/actor above in no way implies that he, or his people, endorse this website or its contents. Just so we are clear. Just a nice night out. Have an easy breezy Sunday! My hot fresh coffee -- and the quiet, luminous beach-front, at dawn -- chants to me now. I'm out.

Friday, July 25, 2014

Sad Late Friday News: Merck To Lay Off 600 People -- In Montgomery County PA

Of course -- and naturally, as ever Ed Silverman at Pharmalot/WSJ had the item, and reaction from Merck first, while I was off the grid, yesterday.

Updated: 07.26.14 -- per an erstwhile anonymous commenter, below: ". . . .Unfortunately, a local story also calls out that 60% of the 8,500 cuts lie ahead in 2015, and hints that the 40% of that figure are not complete yet. . . ."

The fact that CafePharma has been abuzz about just such a sales force headcount reduction for weeks is decidedly cold comfort to the affected workers, and their families. Here's all the sad news, known to the moment, at least -- from Philly.com:

. . . .Merck & Co., which is reorganizing to slash $2.5 billion in costs and 8,500 workers, has informed Pennsylvania officials it will cut 600 jobs at facilities in North Wales and Lansdale.

The cuts were disclosed in an official notice posted on the state Department of Labor and Industry website. According to the notice, the effective date is Aug. 26. . . .

Our thoughts, prayers and meditations go with the affected families.

Thursday, July 24, 2014

Goofy Idenix Shareholder's "Inadequate Value" Delaware Suit Likely Settled; Formal Court Approval Next

As we had earlier predicted, this suit is a dead letter.

It is highly likely that the memorandum settling it requires essentially nothing of Merck or Idenix, other than a report. And (just perhaps) a small payment to defray attorneys' fees -- but none of that is certain -- or public yet. That is my conjecture, solely. So we shall see. The deal is still on target for a Q3 2014 closing. From the amended SEC filing tonight:

. . . .On July 24, 2014, Idenix, its directors and certain officers, Parent and Purchaser entered into a memorandum of understanding (the “MOU”) with the plaintiffs in the above-captioned actions reflecting an agreement in principle to settle the actions based on the agreement to include certain additional disclosures relating to the Offer and the Merger in Amendment No. 6 to the Schedule 14D-9 to be filed by Idenix with the SEC. Idenix, its directors and certain officers, Parent and Purchaser each have denied, and continue to deny, that they have committed, or aided or abetted the commission of, any breach of fiduciary duty or any law, or engaged in any of the wrongful acts alleged in such actions, and expressly maintain that they diligently and scrupulously complied with their fiduciary and other legal duties. The defendants in the actions, to eliminate the burden, expense, distraction and uncertainties inherent in further litigation, and without admitting the validity of any allegation made in such actions, or any liability with respect thereto, have concluded that it is desirable that the claims against them be settled on the terms reflected in the MOU. The terms of the settlement reflected in the MOU are subject to customary conditions including completion of appropriate settlement documentation, court approval and consummation of the Offer and the Merger. The MOU provides that all actions will be dismissed with prejudice as to all defendants. Pursuant to the terms of the MOU, the parties expect to execute a stipulation of settlement, which will be subject to approval by the court, following notice to holders of Shares. There can be no assurance that the settlement will be finalized or that the court will approve the settlement. . . .

So it goes -- have a great Friday, one and all. I'm largely off grid, tomorrow.

Wednesday, July 23, 2014

Federal Funds Can -- And Will -- Be Used To Subsidize Federal Exchanges: Condor's Unsurprising Predictions Dept.

Of course, the marginalia -- the drafting oversight -- ought to be corrected, and of course, the Supremes will likely issue an opinion to that effect. But the black letter law in almost all analogous situations is pretty clear: the IRS may interpret federal revenue and expenditure laws, and issue regulations reasonably implementing the will of our Congress. That it has done.

With the Fourth Circuit (upholding -- with mostly Democrat appointees on the panel), and the DC Circuit (nullifying -- in an all Bush 41 and 43 appointed panel) issuing directly contradictory opinions within hours of one another yesterday, I predict (unsurprisingly) the Supremes will have to take the case.

Also unsurprisingly, the Supremes will -- I predict -- take the Fourth Circuit's opinion, nearly verbatim, as black letter law. The IRS plainly possesses the regulatory and rule-making power to make the laws of Congress work in what it sees as a reasonable way. Once a court concludes that "Congress’s intent in enacting [a specific provision] was not so clear as to foreclose any other interpretation", then the IRS's interpretation is to be given a wide berth.

The IRS has determined that it was an oversight in Congressional drafting, to suggest that federal money could not be used to fund subsidies for federal health exchange participants. And that determination is plainly a reasonable one -- one which furthers Congress's stated intent, in passing the ACA of 2010. Game -- effectively over (but it will be late 2015, before the Supremes offer a published opinion, here).

A bit of the New York Times on it, this morning -- do go read it all:

. . . ."You don’t need a fancy legal degree to understand that Congress intended for every eligible American to have access to tax credits that would lower their health care costs, regardless of whether it was state officials or federal officials who were running the marketplace," said Josh Earnest, the White House press secretary. "I think that is a pretty clear intent of the congressional law. . . ."

[Fourth Circuit] Judge Gregory said, the administration’s position helps achieve “the broad policy goals” of the Affordable Care Act. “The economic framework supporting the act would crumble if the credits were unavailable on federal exchanges,” he said. . . .

In a concurring opinion, Judge Andre M. Davis, a senior judge on the appeals court, said the plaintiffs’ argument “would effectively destroy the statute.” It would, he said, “deny to millions of Americans desperately needed health insurance through a tortured, nonsensical construction” of the law. Judge Davis and the other judge on the panel, Stephanie D. Thacker, were appointed by Mr. Obama.

The health law authorized subsidies specifically for insurance bought “through an exchange established by the state.” When the law was adopted, Mr. Obama and congressional Democrats assumed that states would set up their own exchanges. But many Republican governors and state legislators balked, and opposition to the law became a rallying cry for the party.

The lawsuit in Washington, championed by conservative and libertarian groups, was filed by people in states that use the federal exchange: Tennessee, Texas, Virginia and West Virginia. They objected to being required to buy insurance, even with subsidies to help defray the cost. . . .

I run -- again -- the graphic of that goof-in-chief, Ted Cruz (R), as he is among the named amici submitting briefs to overrule the IRS's interpretation of this provision of the ACA of 2010. He is one lost soul. And what to make of Governors Perry and Haslam, among otehrs? They tell the poorest people in their state -- as your leader, I will not allow you to receive federal funds, to defray 95 per cent of your health costs -- and as your leader, I will provide almost no state coverage for you. There used to be a term for that, on fuedal Europe -- it was aristocratic robber-king. And we know what the peasants' next move was. Right? Right. But here in the colonies, beheadings are now frowned upon. So, vote these jokers -- out of office. They have betrayed their own people. Just my $0.02.

Tuesday, July 22, 2014

Merck's Idenix Cash Tender Offer Clears US Antitrust Review: Hart Scott Waiting Period Popped July 18, 2014

Still very-likely a Q3 2014 closing -- on time, and on target, for this all cash offer for all the shares of Idenix.

From the as amended SEC tender-offer filing (formerly called a Williams Act filing, by old schoolers!), then -- a bit:

. . . .At 11:59 p.m., Eastern time, on July 18, 2014, the waiting period applicable to the Offer and the Merger under the HSR Act expired. Accordingly, the condition of the Offer relating to the expiration or termination of the HSR Act waiting period has been satisfied. . . .

Just like that, the potential (and negotiating strategy) for a Gilead patent royalty payment on Sovaldi® -- its multi-billion dollar titan Hep C drug (the most successful drug launch in history, even adjusted for inflation) is now. . . (as of the closing of the Idenix deal) pretty well consolidated into the very capable hands of Merck's lawyer-chairman. Smart move.

[Preliminary] Merck Spent $1.33 Million On Lobbying, In Q2 2014 -- $3.75 Million Through First Half Of 2014 -- 50 Percent Off, Compared To 2013

I'll update this when the final tally is in (likely later this week), but through 2 pm EDT today, Merck is at $1.33 million. Moreover, just as was true in the first quarter of 2014 -- this year is running at about half of what the 2013 lobby spend levels were.

Merck had lobbying underway on (among other matters):

. . . .Alzheimer's education (no specific bill); 340B (no specific bill); National Diabetes Clinical Care Commission Act (H.R. 1074, S. 539); Eliminating Disparities in Diabetes Prevention, Access and Care Act (H.R. 3322); Hepatitis C education (no specific bill); adult vaccine policies (no specific bill); medication adherence (no specific bill); DISARM (H.R. 4187). . . .

Comprehensive tax reform (no specific bill); transfer pricing of intangibles (no specific bill); territorial tax system (no specific bill); deferral of taxation of foreign earned income (no specific bill); tax base erosion (no specific bill); R&D tax credit (no specific bill). . . .

Non-interference in Medicare Part D (no specific bill); Medicaid-style rebates in Medicare Part D (no specific bill); Low Income Subsidy Copays in Part D (no specific bill); Independent Payment Advisory Board (S. 351, H.R. 351); sustainable growth rate (H.R. 4302). . . .

Trans-Pacific Partnership (no specific bill); biologic data exclusivity (no specific bill); trade promotion authority (no specific bill); treatment of intellectual property in India (no specific bill); Playing Fair on Trade and Innovation Act (HR 3167); additives in beef cattle (no specific bill); trade adjustment assistance (no specific bill); international trade barriers for beta-agonists (no specific bill). . . .

Deficit reduction (no specific bill); ADAP funding (no specific bill); omnibus appropriations; Patent reform (H.R. 3309, S. 1720 ); education on beta agonists (no specific bill). . . .

Now you know. More on the final numbers, soon.

Monday, July 21, 2014

Scholl Non-Americas Rights "Mystery", Clarified: Thanks To A Commenter!

It is truly. . . a gift that so many smart, well-informed, long tenured insiders read this goofy little corner of the pharma/life sciences sector chronicle. Within minutes of my mentioning the Scholl/Reckitt deal, a commenter had provided the whole back-story.

I just couldn't get to it until now, due to other responsibilities. [And, perhaps immodestly, I wanted to honor the commenter's effort, with a custom graphic. Check!] So, the Scholls ex-Americas shoe rights went out of Schering-Plough in the 1980s, per my erstwhile commenter. Nice catch!

Specifically, per my truly-enlightened help: The Reckitt purchase was not recent. Bob Luciano, Chairman of SPG at the time, divested the Scholl business outside North America in 1987 to Seton Healthcare which became Seton Scholl Ltd and the SSL International. Schering-Plough later bought back a small piece of the international footcare (non shoe) business in Latin America and maybe another market. Reckitt bought SSL International in 2010. I had thought their Scholl international business and desire to globalize it might have been a significant driver in their chase of the Merck Consumer Care business at the higher prices. -- /s/ Anonymous @ July 21, 2014 at 11:45 AM. . . .

That fills in all the gaps, nicely! Thanks so much. I had no idea -- just started following SGP around 2007. From a July 2010 Wall Street Journal blog posting then -- that Reckitt 2010 deal -- acquiring SSL International PLC:

. . . .It’s no secret that consumer health care is hot, but Reckitt Benckiser Group PLC’s proposed £2.5 billion offer for SSL International PLC has just slapped a massive 18.6x Ebitda multiple on the sector. . . .

So, now you know. Thanks Anon.! G'night, all.

Did I Miss A Beat, Here? Scholls (Non-US) Rights Belonged To Reckitt Benckiser? Who Knew?!

Back in November of 2009, I suggested that rumors about Dr. Scholl's going to Reckitt seemed. . . unlikely.

Apparently, at some point recently, Reckitt acquired the non-Americas rights to the brand. Now Reckitt is selling those same rights on, to a private equity buyer. So, either I missed a step (an intervening sale -- in 2009 to 2013 timeframe), or this is a new transfer. No matter, Reuters has it all, this morning.

Of course, the US -- and rest of the Americas -- rights will belong to Bayer, as agreed this spring. Per Reuters, then:

. . . .German private equity firm Aurelius said on Monday it is buying Reckitt Benckiser's Scholl shoe business in its efforts to expand internationally, betting on the brand's growth potential.

Under the agreement, Aurelius would acquire the international rights for the Scholl footwear business, excluding North and South America.

The rights to that business in the Americas will go to German drugmaker Bayer as part of its $14 billion purchase of Merck & Co's consumer health business.

Aside from the Scholl shoe business, which is known for its focus on comfort, Reckitt Benckiser has a Scholl-branded footcare business that includes insoles and blister bandages. . . .

The cash Merck got for these legacy Schering-Plough Scholls lines is simply fantastic. Top dollar. Really a coup for Mr. Frazier, at those high valuations. So. . . Onward!

Sunday, July 20, 2014

So -- That Smallpox Story? Not So Uncommon, It Would Seem: NYT

Last Friday night, we talked about extremely dangerous smallpox vials -- forgotten for a half-century, and apparently left entirely unsecured -- in a cardboard shoe-box.

If we are to believe The New York Times -- and there is really no reason not to -- the occurence is not as isolated as we might hope. In fact (stoking some of our worst fears), it turns out that some scientists around the globe are actively researching ways to make such deadly viruses. . . even more communicable. And these are not crazed military "weaponizing" researchers -- in labs in North Korea, or Putin's Russia. No, these are ostensibly respectable researchers whose mission it is to figure out how, and why, a given viral strain might mutate into a global killer and be easily transmitted in open air. Or on open waterways. Truly creepy stuff. Do go read it all but here is a bit:

. . . .The recent mistakes at federal labs have opened the door to a much broader criticism of the risks posed by the expanding research into risky pathogens, especially the efforts to create dangerous strains of flu not currently circulating, or to manipulate already deadly flu viruses to make them more contagious.

Researchers who conduct that work, sometimes labeled “gain of function” research, say its purpose is, in part, to help scientists recognize changes in natural viruses that may help predict which ones are becoming more deadly or more contagious. But it provoked a public outcry in 2011 because of fears that a lab accident might release the altered viruses and start a lethal pandemic.

The studies were halted for about a year while governments and research organizations tried to develop safety rules, but the work has since resumed in several laboratories. . . .

What do you think? Is "gain of function" -- even in truly lethal viral loads -- something we ought to be studying? Is the risk of a mishap worth the benefit of some future possible insight -- that might help us eradicate such an outbreak? I am willing to be convinced, but I lean toward shutting this research down. We do know that weaponizing research is very likely underway in some nefarious labs in North Korea.

Will this competing research provide the defense, should such a weapon be used in the wild? I am puzzled, and more than a little concerned by the whole idea of it. You?

Friday, July 18, 2014

NEJM Formally Publishes Tredaptive Results We Reported In December of 2012 -- "Niacin Clanks" Chronicles

Truthfully, this scarcely qualifies as news. But it has been a slow summer dog's week around Whitehouse Station. These results were first released, on a top line basis, in December of 2012. And we covered them. But the message is clear: Niacin plus laropiprant is probably a dead letter -- and often exhibits a side-effect profile that should not be considered an acceptable risk. [Additional March 2013 vintage background here.] To be sure, it has taken a while -- for Merck's science speakers to come around to this plainly majority view. But it is definitive, now (even if the possibility of infections hadn't been seen -- the lack of outcomes benefit should be the end, all by itself).

From the Monthly Prescribing Reference, then -- a bit:

. . . .Extended-release niacin with laropiprant does not reduce the risk of major vascular events in adults with vascular disease; and extended-release niacin may be associated with increased risk of certain serious adverse events, according to research published in the July 17 issue of the New England Journal of Medicine. . . .

"The findings concerning certain serious adverse infectious events associated with niacin have not been previously reported," Anderson and colleagues write. . . .

Go find a summer adventure this weekend -- I certainly intend to!

Tuesday, July 15, 2014

UPDATE: Google Gets A Highly Credible Partner -- In Novartis/Alcon -- To Develop Its Glucose Monitoring Contact Lenses

Back around Rev. Dr. Martin Luther King Day 2014, we highlighted a then-nascent Google-hardware project. Well, those folks at Google don't just sit around -- on good ideas.

Overnight, we learn that Novartis has signed on to help bring the concept to market. [Recall that Novaris now owns Alcon, here.] The current iteration will continuosly monitor sugar levels in tear-flow. Later versions may well adjust the contacts' optics, via microelectric charges, to sharpen the focus of diabetes patients' vision -- in near real time, via bluetooth, based on the sugar readings. Amazing. Via the British Globe and Mail online, then:

. . . .Swiss drugmaker Novartis has struck an agreement with Google to develop “smart” contact lenses that would help diabetics track their blood glucose levels or restore the eye’s ability to focus.

The device for diabetics would measure glucose in tear fluid and send the data wirelessly to a mobile device, Novartis said. The technology is potentially life-changing for many diabetics, who prick their fingers as many as 10 times daily to check their body’s production of the sugar. . . .

Yes, the future arrives -- right now. Is MRL up to the accelerating challenges -- of eye-blinking innovation -- and complex partnerships -- all in one? We shall see.

Monday, July 14, 2014

As Predicted Right Here, Zilmax® Not To Return To US Market Until 2015 (At The Earliest).

It would seem that -- as I predicted, in March and April of 2014 -- Merck will NOT be able to reintroduce zilpaterol before 2015, in the US. It further seems that Tyson and Cargill have repeatedly indicated they won't buy (from the feedlots) the supposed 250,000 head of cattle which were to be fed Zilmax® -- as part of the reintroduction study. But candidly, that was pretty clear, even last Fall. [More background here.]

From tonight's online Wall Street Journal, then -- do go read it all:

. . . .Merck has delayed plans to begin its field evaluation because of continued unease among Cargill Inc., JBS SA, Tyson and other meatpackers about animal welfare, as well as some packers' reluctance to try to market the beef that would be produced during the research, according to people familiar with the matter.

Merck confirmed the study has encountered setbacks. "This has become more time-intensive than we anticipated," said David Yates, a Merck manager who helped design the planned study. He declined to discuss details of negotiations with meatpackers, but said: "We continue to work on the process to make sure we have alignment with all parties."

The research requires the support of feedlot operators, which fatten cattle for slaughter, and the meatpackers that buy and process them into steaks and ground beef. The three-largest U.S. beef processors — Tyson Foods Inc., Brazil-based JBS and Cargill — account for about 60% of total production, according to industry estimates. JBS also operates one of the world's largest feedlot operations in the U.S.

Mr. Yates declined to specify a new target time period to begin testing Zilmax on cattle. . . .

While the brand sold about $156 million in 2012 -- its last full year on-market in the US -- I'd not expect anything like that, should it come back in the US, in 2015. Even at double that -- or $300 million -- it would remain definitively immaterial to Mother Merck. So it may well be that Merck will concede this market to Lilly (via its Elanco Optaflexx® brands) -- as the clear No. 1 leader, in the US space, now.

O/T Mondays: What Might Have Become, Of Roger Ebert -- Had He Taken Frost's "Path Less Traveled"?

A flick I saw over the weekend (actually, a documentary on the quiet, peaceful end -- to Roger Ebert's life, back in 2013) has put me in mind of "paths less traveled". . . . some 50 years on, now.

If you don't yet know what happened in Birmingham, Alabama, on an early Sunday morning, at the 13th Street Baptist Church -- in mid September 1963 -- do go find out. Or watch Spike Lee's "4 Little Girls".

. . . .[Roger Ebert: ] The children of Birmingham did not really die in the State of Alabama, however, because Alabama is a state of mind, and in the minds of the [white] men who rule Alabama, those children had never lived. . . .

The governor [of Alabama], whose demented attempt to prove himself a white man, has ended in the demonstration that he may not wholly be a man at all, deserves not even pity. His life is his own to live, and his nights are his to sleep, if he can. . . .

And it happened in Alabama to children we did not know and would never have known. But because they died, it happened to us. And the blood is on our hands, because every one of us owed to those children a future. . . .

Their blood is on so many hands, that history will weep in the telling. . . . And it is not new blood. It is old, so very old. . . . It clings and waits, and in its turn, it kills again. . . .

Now click the image, at right -- to read the rest of what a then only 20 year old Roger Ebert (as Editor in Chief of the Daily Illini) was thinking, of it all.

His artistic and rhetorical reach here is. . . astonishing. Oh my.

What might have been. . . . not that he didn't lead an amazing life, as it was.

Just. . . what if he had focused on politics. . . or civil rights, as a principal -- and principled -- avocation? What if? Here is the full PDF of that day's paper (see page 8).

Sunday, July 13, 2014

Lawsuit Tug O' War: Fight Escalates -- Over Potential Lost Tax Revenue -- From Legacy Schering-Plough Site In Union, NJ

At the end of May 2014, we detailed a burgeoning legal spat, over the legacy Schering-Plough facility in Union, New Jersey, on Morris Avenue (see at right). Merck has vacated the place, and Kean University wants to get its hands on it. But that would take it off the real estate tax rolls.

Prior to the Kean University interest, it is claimed that Merck had agreed in principle to sell it to Russo Investments -- an entity that would keep it on the taxable, and tax-paying, parcel lists, in Union. Then enters (stage right), an heir to the vast Kean fortune, in New Jersey. It seems that running with the land was a covenant that should it be sold, the Keans had a right of first refusal -- via a trust which (it is claimed, again) expired in the 1990s. Even so, the Kean heirs have indicated their desire to exercise this right, and then sell on to Kean University. The property would nicely complement the existing Kean U. campus space -- as it is dead across the street from the main campus. Thus the escalation in rhetoric, and blue-backed legal pleadings. Smile.

From NJ.com, we learn that Union township's mayor is pretty surprised -- and disappointed -- that a court is essentially allowing the sale to the University -- contingent only on a final court order that the same is proper (i.e., that the covenant still runs with the land, through the trust -- to the Kean heirs at law).

And so -- it does not look particularly good for all the other residents of Union, who rely on those tax revenues, for public school funding, snow plowing and garbage pickup. Here's the bit -- and do go read it all (as a story of more legacy Schering-Plough rust-creation, on the old iron shelves of the nation's medicine cabinet):

. . . .However, on June 30, Judge Katherine Dupuis granted the university's request to pursue the sale, and enter a purchase contract. The university, however, cannot not close on the property pending the outcome of the lawsuit.

"To our surprise it seems that they are moving forward," township [Union, NJ] Mayor Clifton People said. "They can do everything except complete the actual sale. . . ."

He estimated that the township would lose $4 million in property taxes annually if the university takes the property. Public institutions, such as universities, do not pay property taxes. . . .

Much could yet change -- as the lawsuits wind their way through the byzantine New Jersey state court system -- so we will keep you posted. [Go out and have a Sunday-style adventure! Ice cream on the beach or biking in the leaves. . . I will as well.] And, do go see the new posthumous Roger Ebert documentary (in limited release this weekened) -- very good stuff, for all movie fans -- and fans of a vastly gentle, but searing, intellect. What he wrote, at age 20 (on the University of Illinois daily paper's editorial page), about the "4 Little Girls" bombing in Birmingham that year -- will resonate with you, to your dying day. I promise.

Saturday, July 12, 2014

Federal Fosamax® Femur MDL Update: The Gaynors Take Their Bellwether Trial, On Appeal To The Third Circuit, On SUmmary Dismissal By Judge Pisano

About ten days ago, we noted that the very competent US District Court Judge Joel Pisano (sitting in Newark) had dismissed the Gaynors' suit against Merck -- saying that there were essentially no claims left (even if proved) -- that would entitle the Gaynors to a judgment against Whitehouse Station.

So the jury never got empaneled -- to hear, or deliberate -- on their case. Now they appeal that ruling. Meanwhile Judge Pisano continues to look for other bellwether cases to help line out the likely settlement posture for the parties -- and get a handle on whether the damages (if any are found to be attributable to Merck's conduct in selling Fosamax®) will warrant any form of a global offer from Merck. We are keeping tabs:

. . . .PLEASE TAKE NOTICE that Barbara Gaynor and Robert Gaynor, plaintiffs in Barbara Gaynor and Robert Gaynor v. Merck Sharp & Dohme Corp., appeals to the United States Court of Appeals for the Third Circuit from each and every part of the Opinion and Order entered on June 17, 2014 [MDL Dkt. Nos. 3855, 3856], and from all prior and subsequent opinions, orders, and rulings adverse to Plaintiff, including without limitation the Letter Order entered on August 13, 2013 [MDL Dkt. No. 2887] and the Order to Show Cause entered on August 15, 2013 [MDL Dkt. No. 2895].

Dated: July 10, 2014. . . .

We will keep you up to the minute -- as this appeal progresses, but I see only a small chance that Judge Pisano is overruled here.