Investing in drug companies from year 1999 to 2008 feels more like a
act of gambling than investing.
Few of the drug companies have reached all-time highs of their stock
in that time period and
most have fallen to new lows. Most have not recovered since the
dot.com bubble burst of 2000.
Merck, if memory is correct is only a 1/4 of all time market
capitalization of its prior history. Schering Plough
is 1/6 of its all-time market capitalization if memory serves, and it
is not worth the time for me to look up to
make precise those numbers. Trust me, the downfall has been huge.
Pfizer has languished in the low $20
price range for nearly the entire 8 year period. European drug
companies have not fared any better.
What is the trouble with the Drug Industry? I believe it is because
drugs can be placed into three categories.
Category 1 are life saving drugs or essential drugs such as viral
drugs or antibiotics.
Category 2 are over the counter symptom medication that are cheap
drugs, example is aspirin,
or an arthritis pain reliever
Category 3 are what I call pompous drugs, or drugs that are used when
a exercise program or change
in behaviour is the better alternative. This category is sales and
unproven claims and what one can
call the s**** oil medicine of the 21st century. Drugs such as
cholesterol drugs and Viagra are
prime examples of drug industry gone awry.
The reason that Drug company stocks are more of a gamble these days
rather than a solid investment
is because if one evaluates the worth of Merck or Pfizer or any of the
drug companies, there worth
is only the addition of category 1 plus category 2.
If one pays $20 a share for Pfizer today, then in my opinion they are
paying an inflated price for the true
assets of Pfizer because their Lipitor and Viagra are a liability and
bad for health since alternatives exist
which are better.
The sinking of Vytorin for Merck and Schering Plough is the fact that
if a Study were done on
100,000 people where 50,000 of them took Vytorin and 50,000 took no
Vytorin but who exercised
everyday with a bicycle ride to work or a 10K run per week and kept
their weight the same as
their High School weight. That roughly guessing on my part the 50,000
cholesterol takers half
died prematurely whereas in the other 50,000 group less than 1 percent
died prematurely, all
of which is my guessing. But the point is clear, that we have drug
companies panning for
overweight people to take cholesterol drugs when their real problem is
overweight.
So if such a survey and study like the Enhance study of Vytorin were
conducted on Lipitor or
Crestor, my guess is that half of the 50,000 would die prematurely
whereas a mere 1 percent
of the exercise and High School weight 50,000 would live long.
So if Pfizer were to halt its Viagra and Lipitor sales, would its
stock plummet to $10 a share?
Probably so. Because honestly, is the world really in need of a drug
that questionably does
anything to overweight fat people who really need daily exercise and
does the world need
a drug such as Viagra?
So all the drug company stocks of today are vastly overpriced because
if a World Science Council
existed, the Council itself would judge these silly and stupid drugs
of cholesterol and Viagra
and these behaviour changing drugs that many feed our small children
just because they
are more active and not controlled as a passive and sedate child. The
World Science Council
would judge these what I call Pompous drugs and rule that they should
be banned except for
a few cases.
The present situation in the world with drug industry is that most big
companies are full of these
pompous drugs and their market capitalization value is overvalued such
as Pfizer and Merck
by at least double. And what happens is that as these Studies such as
Enhance come in
or the studies of Vioxx of their side effect harms that the lawyers
and lawsuits eat up much of
any little profits and the sucker shareholders end up with a loss or
flat investment.
Another good name for Category 3 drugs is Sucker drugs and this
problem is enhanced
by the drug companies through their silly and stupid constant TV
advertisement. Restless
Leg Syndrome, is s**** oil of a previous century back.
Archimedes Plutonium
www.iw.net/~a_plutonium
whole entire Universe is just one big atom
where dots of the electron-dot-cloud are galaxies
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