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Healthcare Pulse: Amgen, Inc. (AMGN), Depomed Inc (DEPO), and Pfizer Inc. (PFE)


The UK’s health cost watchdog has turned down Amgen, Inc. (NASDAQ:AMGN)’s cholesterol medicine Repatha. A point of concern for the agency is that the drug does not give assurances over its ability to reduce heart attacks and strokes. There are also concerns that the drug maker might have over-estimated the risk of heart disease for people with too much cholesterol.

Repatha works well to reduce the bad kind of cholesterol but, on the other hand, fails to prove that it cuts the number of heart attacks and strokes. Amgen, Inc. (NASDAQ:AMGN) says it is disappointed by the decision considering high cholesterol levels always lead to heart attacks and strokes.

Amgen’s cholesterol drug just like Sanofi SA (ADR) (NYSE:ADR)’s Praluent belongs to an expensive class of drugs called PCSK9. The drugs are offered as alternatives to patients who can’t bring their cholesterol levels under control using older medicines.

Repatha goes for $6,769 in the UK, for a year treatment, almost half the price list in the US.

Depomed Inc (NASDAQ:DEPO) is not relenting on it push to bolster its portfolio of pain drugs even as it faces a hostile $2 billion bid. The biotech company is in the process of acquiring the US and Canadian rights to Cebranopadol from Germany’s Grunenthal GmbH. Upon acquiring the rights, it intends to pursue a late-stage study on the use of the drug to treat lower back pain in 2017.

Depomed Inc (NASDAQ:DEPO) is to pay $25 million for the drug. It will also have to clear up an intellectual, legal fight around another drug with the German company as part of the deal. The deal should close by the end of the year.

The company’s rich portfolio of drugs has made it a hot takeout prospect in the industry. It has already turned down two offers from Horizon Pharma PLC (NASDAQ:HZNP) with the latest worth more than $2 billion. Shareholders have until November 30 to consider the offer.

Pfizer Inc. (NYSE:PFE) is forging ahead with its $150 billion acquisition of Allergan PLC (NYSE:AGN) even as the US Treasury ramps up efforts to clamp on tax inversions. Negotiations are in advanced stages, but it is not clear if an agreement is imminent as Treasury’s moves to tighten rules on inversions.

The Treasury is in the process of drafting new regulations that will seek to deter and reduce economic benefits that corporate look for on inversions. The new regulations may seek to tighten rules on ‘earnings stripping’ and ‘skinny down’ distributions strategies.

Earnings stripping rules may seek to combat the shifting of profits forms the US to other countries to avoid paying taxes. Rules targeting skinny down distributions may in future make it hard for companies to skin their operations to evade standards for minimum levels of foreign ownership.

Sources close the talks say Pfizer Inc. (NYSE:PFE) is negotiating a share price of between $370 and $380. Allergan PLC (NYSE:AGN) shares are currently trading at the $310 level. A successful merger would give Pfizer access to Allergen’s aesthetics and ophthalmology markets apart from the tax considerations.

Viraj Shah

Viraj Shah has completed M.Com (Finance) and is currently pursuing his CFP. He tracks US markets along with other global markets like India very closely. He is very passionate about stocks, real estate, and technology. He also believes that money can always be made in the market.

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