Feds Rarely File Charges In Tainted Food Cases
“Part of that system is the ability to penalize the people that fail,” said Michael Taylor, a food safety scientist at George Washington University. “And theres been a real failure to do so at the federal and state level.”
Food safety advocates hope that is starting to change.
The Food and Drug Administration said Friday it has asked the Justice Department to launch a criminal investigation into Virginia-based Peanut Corp. of America, which authorities say shipped products that initially tested positive for salmonella after retesting and getting a negative result. At least 529 people have been sickened as a result of the outbreak, and at least eight may have died because of it. More than 430 products have been recalled.
If they decide to press charges, prosecutors could use the 1938 Federal Food Drug and Cosmetic Act, which gave the government leeway to charge food manufacturers if they were responsible for contaminated food. The Supreme Court gave prosecutors more leverage in 1975 when it ruled they didnt have to prove the companies knew the food was contaminated.
The ruling prompted only a modest increase in prosecutions.
“There have been innumerable times they could have prosecuted but didnt,” said Bill Marler, a Seattle-based food safety lawyer who has filed two lawsuits against Peanut Corp. of America over the recent outbreak. “My sad speculation, frankly, is that prosecutors in the U.S. on the Justice Department side or state side dont see poisoning people with food for profit as a crime.”
The Food and Drug Administration said it doesnt track food-related prosecutions separately, but said its investigative arm logged 341 arrests and 279 convictions in 2006. Many of those involved counterfeit medicines and faulty or tampered products, which also fall under its jurisdiction.
Recent convictions include the 1996 case against juice-maker Odwalla Inc., which was fined $1.5 million on charges of shipping unpasteurized apple juice that killed a baby.
Five years later, Sara Lee Corp. was fined $200,000 after pleading guilty to misdemeanor charges of selling tainted meats in a listeria outbreak that killed 15 people.
The FDA also points to prosecutions in lower-profile cases, such as the 2007 conviction of a man who made false reports to investigators after a mix-up led to antibiotics being dumped into unpasteurized milk at a New York farm.
Although cases may not yield criminal charges, firms are often targeted with a flood of civil lawsuits seeking monetary damages. In some cases, the companies also agree to tighten testing standards and spend more money on safety measures.
Federal charges also were never filed against ConAgra in the 2002 E. coli outbreak that prompted a massive meat recall and sickened at least 19, or the companys 2007 peanut butter recall after a salmonella outbreak spread to more than 400 people.
And prosecutors decided against pursuing charges against two produce companies involved in the 2006 tainted spinach case, saying the investigation found the growers and processors did not deliberately skirt the law.
Part of the problem, attorneys say, is that prosecutors arent using other criminal charges to pursue cases. In the current outbreak stemming from tainted peanut butter, Georgia agricultural officials had said they would consider pursuing state manslaughter charges if federal authorities did not take up a case against the peanut processing plant in rural southwest Georgia.
“If a U.S. attorney wanted to prosecute this as a felony, there are enough statutes they could use to charge it out as a felony,” said Fred Pritzker, a food safety lawyer in Minneapolis who has filed a wrongful death lawsuit on behalf of a 72-year-old woman whose death may be linked to the current outbreak.
Eric Greenberg, a Chicago-based attorney who defends food and drug companies, said some prosecutors also may shy away from such cases because they take time and manpower for an agency thats already stretched thin.
Source: cacru
Lilly, Daiichis Prasugrel Backed With Restrictions
Lillys shares fell after the Food and Drug Administration posted the staff report today. The drug was found to help heart- attack patients. Still, some reviewers said the medicine should be used only for short periods and carry the strictest caution about the danger of excess bleeding. The report also suggested excluding patients older than 75 and warning about cancer risks.
Conditions and warnings may make it harder for the drug to take sales from Plavix, an $8.1 billion seller for Bristol-Myers Squibb Co. and Sanofi-Aventis SA. Prasugrel, to be sold as Effient, is vital to Indianapolis-based Lillys plans to replace revenue lost when its top-selling antipsychotic Zyprexa loses patent protection in 2011.
“It does set the product up for a difficult launch, since the label will contain a warning and patients will need to be enrolled in a patient management system, which could be an added hassle and scare for some doctors,” Jon LeCroy, an analyst at Natixis Bleichroeder in New York, said in a note to clients today. He recommends selling Lilly shares and doesnt own them.
Outside advisers to the FDA will meet Feb. 3 in the Washington suburb of Silver Spring, Maryland, to discuss the staffs findings and recommend whether Effient should be cleared for sale. The agency has also asked the committee of doctors and scientists to consider what limitations would be needed if the drug is approved.
Shares Fall
Lilly dropped $1.15, or 3 percent, to $36.82 at 4 p.m. in New York Stock Exchange composite trading. The drugmaker also announced today that its U.S. president, Deirdre Connelly, is departing for GlaxoSmithKline Plc. Before the review was released, Daiichi Sankyo fell 15 yen to close at 2,040 yen in trading in its hometown of Tokyo.
Effient is designed to prevent blood clots in patients with heart problems who are undergoing procedures to unclog their arteries. These procedures, called percutaneous coronary interventions, are usually followed by insertion of a stent to keep the arteries propped open.
A company-funded study of 13,000 patients found that Effient prevented more heart attacks than Plavix, though more people taking Effient died from bleeding. The drug was also linked to an increased risk of stroke in patients who had previously had one, and more cases of cancer, according to the FDA review.
Disagreement on Limits
The agencys Division of Cardiovascular and Renal Products recommended that Effient be marketed to prevent heart attacks. At the same time, it said too little proof existed to support the companies request to claim a benefit against strokes or deaths.
While some reviewers suggested limiting Effient use to one week to manage the risk of bleeding and prevent a possible association with cancer, there was no consensus in the agency report whether this was necessary.
Deadline Missed
Lilly and Daiichi Sankyo applied for FDA approval in December 2007. The agency early last year granted a priority review, with a decision due in June rather than the longer wait typical under the standard review. The FDA extended the review when new data became available, then missed a September deadline for action, and said Dec. 31 it would convene the advisory panel.
The FDA hasnt told Lilly when it will decide on the application, Chief Executive Officer John Lechleiter said to investors on Jan. 7. The agency usually follows the recommendations of its advisory panels, though it isnt required to do so.
A European advisory panel recommended approval of Effient on Dec. 18, and a final ruling by the European Commission typically follows within three months.
Barbara Ryan, an analyst at Deutsche Bank in Greenwich, Connecticut, expects FDA approval of Effient in the second half of this year and annual sales of $1.3 billion by 2013.
The “cautionary/restrictive language” recommended in the FDA staff review “is consistent with our views for this drug,” Ryan said today in a note to clients. She has a hold rating on shares and doesnt own any.
Even if the drug is approved, it may not be enough to make up for the loss of Zyprexa sales, according to Tim Anderson, an analyst at Sanford C. Bernstein & Co. in New York.
Peanut Butter-maker Under Criminal Probe In Deaths, Sickness
The Justice Department and the Food and Drug Administration are together investigating closely held Peanut Corp. of America, said Stephen Sundloff, director of the agencys Center for Food Safety and Applied Nutrition, in a conference call with reporters today. The companys Blakely, Georgia, plant has been identified as the source of the bacteria.
White House spokesman Robert Gibbs confirmed the investigation during a briefing with journalists, when asked about an Associated Press report that the FDA knew in April about a shipment of peanuts from the plant containing pieces of metal and never tested by inspectors. Agency records also found that an outside lab uncovered salmonella at the plant as recently as last year, AP reported. A second round of testing by a different company turned up negative for salmonella, the news agency said.
“I think the revelations have no doubt been alarming, that whether it was our own regulatory system or a company that repeatedly found salmonella in its own testing would continue to ship out that product is beyond disturbing for millions of parents,” Gibbs said.
More Recalls
The FDA expects more recalls beyond the 350 products with peanut butter or paste already flagged, Sundloff said. The list of sickened consumers has grown by 28 over the past five days, Robert Tauxe, a deputy director in FDAs foodborne diseases division, said on the call.
The outbreak doesnt affect supermarket peanut butter brands. Peanut Corp.s peanut butter and paste are used by food manufacturers in “hundreds of different products, such as cookies, crackers, cereal, candy and ice cream,” according to the FDA Web site, which lists recalled products.
“The outbreak appears to be ongoing,” Tauxe said.
A Justice Department spokesman, Charles Miller, said the agency wasnt commenting and referred calls to the FDA.
Peanut Corp. spokesman George Clarke said the company will make a statement soon. He wouldnt elaborate.
“We have been devastated by this and we have been working around the clock with the FDA,” said a recorded message on the companys news media phone line.
Consumers concerned about peanut-butter containing products should check the FDAs Web site at www.fda.gov or call a CDC information line at 800-232-4636 for updates on recalled products, Sundloff said. Those who handle potentially contaminated items should wash their hands afterward, he said.
The company, based in Lynchburg, Virginia, recalled all peanut products made since January 2007 at its Blakely plant, FDA officials said Jan. 28. The factory has been identified as the source of an outbreak of the bacteria salmonella typhimurium that began in September and has sickened people in 43 states and Canada, the agency has said.
Peanut Corp. shipped crackers and other foods from the plant after tests on a dozen occasions in 2007 and 2008 showed salmonella, the FDA and U.S. Centers for Disease Control and Prevention said.
Painkiller Linked to Deaths Should Be Withdrawn, Fda Panel Says
A joint FDA advisory committee meeting in Gaithersburg, Maryland, today voted 14-12 that the risks of Darvon outweigh its benefits, said Karen Riley, a spokeswoman for the agency, in an e-mail. The prescription medicine, known chemically as propoxyphene, has been sold since 1957 for mild to moderate pain.
The panels recommendation, while not binding on the FDA, is a victory for Public Citizen, a Washington consumer group that petitioned the agency in 2006 to take the painkiller off the market. The group said the drug and its generic equivalents were linked to more than 2,000 accidental deaths in the U.S. from 1981 to 1999. FDA staff disagreed in a report released on Jan. 16, saying the known risks were consistent with product labeling.
“There is little doubt that were propoxyphene and propoxyphene-containing products to come before these committees today for approval, based on what is now known, they would be rejected because of one of the most unfavorable benefit-to-risk ratios ever seen for a drug,” Sidney Wolfe, head of Public Citizens health research group, told the advisory panel today.
The FDA usually follows the recommendations of its advisory panels, though it isnt required to do so. Theres no deadline by which the FDA must decide what action to take.
Closely held Xanodyne Pharmaceuticals Inc. of Newport, Kentucky, markets the Darvon and Darvocet brands and believes they are safe and effective, said Kevin Anderson, the companys chief compliance officer, in an e-mail last month. Darvocet contains acetaminophen, the active ingredient in Johnson & Johnsons Tylenol.
Fda: Feds Open Criminal Investigation Into Georgia Plant That Shipped Tainted Products
More than 500 people have been sickened as a result of the outbreak, and at least eight may have died because of salmonella infections. More than 430 products have been pulled off the shelves in a recall that reaches to Canada and Europe.
In another development Friday, officials urged consumers to be cautious about “boutique” brands of peanut butter, which had not previously figured in the recall.
Although national brands of peanut butter are unaffected, some smaller companies may have received peanuts from the processing plant in Blakely, Ga., the FDA said.
Meanwhile, the White House pledged stricter oversight of food safety.
Press secretary Robert Gibbs said Friday that President Barack Obama plans to name a new FDA commissioner and other oversight officials in coming days. Gibbs said they will establish a “stricter regulatory structure” to prevent breakdowns in food safety.
“I think the revelations have no doubt been alarming,” said Gibbs. That a company which found salmonella in its own testing would continue to ship products “is beyond disturbing for millions of parents,” he added.
FDA officials said they last inspected the Blakely facility in 2001, when it wasnt being used to make peanut butter.
It did not get much attention from the federal government again until earlier this year, when a shipment of peanuts from the plant was returned from Canada because it was contaminated with metal fragments. The FDA then asked Georgia authorities to inspect.
But the state inspections did not detect what FDA officials say was a salmonella problem at the plant dating back to at least June of 2007.
The return of the contaminated shipment of peanuts was first reported by the Associated Press.
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Source: wijan
Roche Makes Hostile Bid For Genentech, Lowers Price
The cash offering replaces the original $89-a-share proposal that was intended to lead to a negotiated merger, the Basel, Switzerland-based company said in a statement today. Roche will begin a tender offer within two weeks.
The latest approach, Roches second unsolicited bid following the purchase of U.S. diagnostics company Ventana Medical Systems Inc. last year, comes on the heels of Pfizer Inc.s $68 billion planned takeover of Wyeth announced on Jan. 26. Drugmakers are seeking a way out of the deepening global recession that threatens prices and increases the pressure to speed more products to the market at a time when some of the industrys biggest medicines are losing patent protection.
“Its pretty much Ventana revisited and along with it comes risks and potential benefits,” said Karl Heinz Koch, an analyst at Helvea in Zurich. “Because its no longer friendly, theres a higher risk of losing key people.”
Roche gained as much as 3.4 percent in Zurich trading to 165.7 Swiss francs, selling for 163.7 francs as of 9:33 a.m. to give it a market value of 142 billion francs ($123 billion). Genentech gained 65 cents, or less than 1 percent, to close at $84.09 in New York yesterday, 2.8 percent below todays offer price. That gives Genentech a market value of $88.5 billion.
Direct Offer
“In light of the lack of progress towards an agreed transaction” with Genentech, “Roche has now decided to make an offer directly to Genentech shareholders,” the Swiss company said in the statement.
Full ownership would help Roche, which has held a stake in the U.S. company for almost 20 years, boost income from Genentechs products and ensures access to its labs after an existing accord expires in 2015.
Roche intends to keep Genentechs research and early drug development independent, and said it would move its own U.S. commercial operations to Genentechs South San Francisco, California, site. The combined U.S. pharmaceutical operations would carry the Genentech name, Roche said.
The Swiss drugmaker said in July the weakness of the dollar against the franc played a role in the timing of its offer. The U.S. currency has since strengthened about 13 percent against the franc.
Second for Schwan
A takeover would be the second major transaction for Severin Schwan, 41, who took over from Franz B. Humer as chief executive officer less than a year ago. Schwan led Roches $3.4 billion purchase of Ventana as head of Roches diagnostics unit.
Buying Genentech would cut costs and boost earnings for Roche, the worlds biggest maker of tumor-fighting drugs. The Swiss company has used Genentechs advances in cancer treatment to become the fastest-growing among the worlds largest pharmaceutical manufacturers.
Genentech products, including the Rituxan and the Avastin cancer medicines, account for about 40 percent of Roches revenue.
Avastin is approved to treat colon, lung and breast tumors and is being tested in more than 400 clinical trials involving 40,000 patients worldwide. Avastin may also become the best- selling medicine in the world within six years, according to London-based consultant EvaluatePharma. The medicine generated 3.7 billion francs in sales for Roche during the first nine months of 2008.
Conditions Attached
Roches offer is subject to the majority of outstanding shares being tendered and is conditional upon Roche obtaining sufficient financing. The Swiss drugmaker plans to finance the transaction with a mixture of its own cash, commercial paper, bonds and bank loans.
The Swiss company plans to tap bond markets first for financing. Pfizers takeover of Wyeth had no influence on the decision to pursue a hostile bid for Genentech, Humer said on a conference call.
Roches move follows an agreement by its controlling family two days ago, extending a shareholders pact to keep their majority stake in one pool for an unlimited period and preserving the Swiss companys independence.
Cheap Depression Drug Beats Effexor, Lexapro In Study
Sertraline, the generic form of Pfizers Zoloft, came out ahead in a comparison of the results of 117 head-to-head drug studies that included almost 26,000 patients, an international team of researchers said in the Lancet. The generic drug elicited the best response and was most accepted by patients, they said.
The study of published and unpublished research targeted a dozen of the newest anti-depression drugs, including Wyeths Effexor, Lillys Cymbalta and Forests Lexapro. Sertraline and Lexapro were the only medicines ranked at the top for both ease of use and effectiveness.
“Although all approved antidepressants work and are safe, they arent all the same,” said John Geddes, a professor of epidemiological psychiatry at the University of Oxford who worked on the study.
Sertraline, sold for less than a dollar a day, could be used in tests of experimental medications, replacing placebo controls that lead many patients with serious illness to eschew trials, Geddes said yesterday in a telephone interview.
The research teams independence from drug companies should help doctors and patients decide how to pick among the depression treatments available, wrote Sagar Parikh, of the University of Torontos department of psychiatry, in an accompanying editorial.
Study Questioned
Gwen Fisher, a spokeswoman for Madison, New Jersey-based Wyeth, questioned the findings, saying that most of the trials in the study “were not adequately blinded.”
“In the field of anti-depression research, open-label, unblinded clinical studies, including meta-analyses of these studies, are of limited validity in determining the efficacy and tolerability of a drug,” she said in an e-mail. “What we see from other clinical trials, which is supported by this meta- analysis, is that Effexor XR is a potent and effective treatment for depression.”
Frank Murdolo, a spokesman for New York-based Forest, said the company was pleased the analysis showed Lexapro is one of the best choices for the treatment of depression. Officials for Indianapolis-based Lilly didnt have an immediate comment on the study results.
Novartis Deal Scouts Get Significantly More Funding
The Novartis unit that scouts for products, evaluates projects and carries out due diligence has gotten “significantly” more funding, said Joe Jimenez, head of the pharmaceutical division, yesterday in an interview at the companys Basel, Switzerland, headquarters. He declined to quantify the increase, saying it was less than 25 percent.
Switzerlands second-biggest drugmaker needs to replace income from the heart medicine Diovan and the Gleevec cancer treatment when patents expire starting in 2012. The drugmaker plans to make more acquisitions in the next 12 months than the three purchases it made last year, Jimenez said. Novartis is looking to acquire health companies and buy marketing rights for drugs, he said.
“We have increased the funds towards due diligence, search, and evaluation and negotiation significantly,” Jimenez said. Prices for licensing deals “have come down” and “a number of biotechs are running out of money and are more willing to sell.”
Chief Executive Officer Daniel Vasella said yesterday, after Pfizer announced Jan. 26 that it will buy Wyeth, of Madison, New Jersey, for more than $68 billion, that he is sticking to his strategy to buy small companies and invest in research.
Vasellas Strategy
“I dont anticipate well be in a transformational transaction,” Vasella said in a Bloomberg television interview after the company reported earnings. “Our strategy really is to look at additional, smaller acquisitions that fit our existing business.”
Novartis is interested in experimental drugs in the second and final stages of human trials, Jimenez said. He declined to name any potential targets. Cash flow will cover the funding increase, Novartis spokesman Eric Althoff said.
The company may want to broaden its stable of central nervous system treatments and cardiovascular drugs, said Karl Heinz Koch, an analyst at Helvea in Zurich.
“Alzheimers is a sweet spot, and Novartis barely has anything in the pipeline,” he said. The company may also want to add antiviral treatments for Hepatitis C to complement its albuferon medicine, according to Koch.
Eyes Wide Open
In the last year, Vasella agreed to spend $115 million for Nektar Therapeutics pulmonary unit, as much as $400 million for antibiotic maker Protez Pharmaceuticals Inc. and about 1.01 billion Swiss francs ($932 million) for hypertension drug partner Speedel Holding AG. He also paid $10.4 billion in cash for a 25 percent stake in Swiss eye-care company Alcon Inc.
Novartis fell 1.32 francs, or 2.7 percent, to 47.3 francs at the close of Zurich trading. The stock is down 10 percent this year, compared with a 2.6 percent decline in the 18-member Bloomberg Europe Pharmaceutical Index.
Glaxos Acquisitions
Vasellas strategy is similar to that of GlaxoSmithKline Plc CEO Andrew Witty. In a Jan. 8 interview, Witty said adding more vaccines, medicines and consumer products will help wean the U.K. drugmaker off its reliance on one or two bestsellers. A large merger or acquisition would threaten to disrupt the companys own revamped research and development operations, Witty said.
Pfizers bid to buy Wyeth reflects the companys failure to offset looming generic competition to Lipitor, the companys best-selling cholesterol pill, using job cuts, new research priorities and sales in developing countries, analysts said.
“We dont consider it to be of great strategic importance for us directly,” Vasella said. “Pfizer has recognized that certain diversification is positive. For Pfizer, its the logical step to do. Either you grow externally or you grow internally as a main driver.”
Two days after Pfizer announced its bid for Wyeth, Roche Holding AGs majority shareholder agreed to keep its stake in one pool for an unlimited period, protecting Novartiss larger Swiss rival from a takeover as industry mergers are heating up.
Roche is offering $43.7 billion for the 44 percent of Genentech Inc. it doesnt own, a price the U.S. biotechnology company rejected as too low.
Lilly Reports $3.63 Billion Loss After Imclone Deal
The net loss amounted to $3.31 a share and compares with a profit of $854.4 million, or 78 cents a share, a year earlier, the Indianapolis-based company said today in a statement. Sales increased slightly to $5.21 billion from $5.19 billion, missing estimates of $5.39 billion.
Lilly bought ImClone on Nov. 25 to add the cancer medicine Erbitux and experimental drugs to bolster revenue before the 2011 patent expiration of the antipsychotic Zyprexa, the companys top revenue producer with $4.7 billion in sales last year. Lilly faces a U.S. Food and Drug Administration panel on Feb. 3 to discuss its experimental blood-thinner, prasugrel.
“Growth for key drugs is moderating,” said Barbara Ryan, an analyst at Deutsche Bank Securities in Greenwich, Connecticut, in a note to clients today. “Lillys near-term earnings per share growth prospects will be tempered by the dilutive impact of the ImClone acquisition and are vulnerable longer term to the patent expirations on important and profitable drugs.”
Lilly fell $1.12, or 2.9 percent, to $37.97 at 4:01 p.m. in New York Stock Exchange composite trading. The stock has declined 27 percent in the last 12 months, compared with a 21 percent decline in the Standard & Poors 500 Health Care Index.
Beat Analysts Estimates
Fourth quarter earnings excluding the acquisition and other items were $1.07 a share, beating the average estimate of $1.05 by 15 analysts surveyed by Bloomberg.
Lilly reiterated its 2009 earnings forecast of $4 to $4.25 a share. The company said it will earn $4.35 to $4.55 a share, when the ImClone purchase is excluded.
Worldwide sales were reduced 3 percentage points from converting foreign income into U.S. dollars, the company said. In 2008, the dollar rose 6.1 percent against a basket of six foreign currencies.
Prasugrel has been twice delayed by the U.S. Food and Drug Administration. The panel, whose decisions are typically adopted by the FDA, will meet to discuss the benefits of the drug and the risk of excessive bleeding from it. Prasugrel may reach $950 million in annual sales by 2015, said Tim Anderson, an analyst at Sanford C. Bernstein in New York. Japan-based Daiichi Sankyo is Lillys partner on the drug.
Fresh Competition
Zyprexa faced fresh competition this year after lower-priced generic copies of Johnson & Johnsons Risperdal, a competing treatment, went on sale in July. Sales of the drug fell 10 percent in the quarter to $1.15 billion.
The cancer treatment Erbitux, which Lilly markets in the U.S. with New York-based Bristol-Myers Squibb Co., generated sales of $35.6 million after the ImClone acquisition. Bristol- Myers reported on Jan. 27 that Erbitux sales declined 2 percent for the quarter after a study found that the medicine didnt work in patients with a gene mutation.
Novartis Deal-making Scouts Get Significantly More Funding
Novartiss unit that scouts for products, evaluates projects and carries out due diligence has gotten “significantly” more funding, said Joe Jimenez, head of the companys pharmaceutical division, yesterday in an interview at Novartiss Basel, Switzerland, headquarters. He declined to specify the increase, saying it was less than 25 percent.
Novartis, Switzerlands second-biggest drugmaker, needs to replace income from the heart medicine Diovan and the Gleevec cancer treatment when patents expire starting in 2012. The drugmaker plans to make more acquisitions in the next 12 months than the three purchases it made last year, Jimenez said. Novartis is looking to acquire health companies and buy marketing rights for drugs, he said.
“We have increased the funds towards due diligence, search, and evaluation and negotiation significantly,” Jimenez said. Prices for licensing deals “have come down” and “a number of biotechs are running out of money and are more willing to sell.”
Chief Executive Officer Daniel Vasella said yesterday, after Pfizer Inc. announced Jan. 26 that it will buy Wyeth, of Madison, New Jersey, for more than $68 billion, that he is sticking to his strategy to buy small companies and invest in research.
Vasellas Strategy
“I dont anticipate well be in a transformational transaction,” Vasella said in a Bloomberg television interview after the company reported earnings. “Our strategy really is to look at additional, smaller acquisitions that fit our existing business.”
In the last year, Vasella agreed to spend $115 million for Nektar Therapeutics pulmonary unit, as much as $400 million for antibiotic maker Protez Pharmaceuticals Inc. and about 1.01 billion Swiss francs ($932 million) for hypertension drug partner Speedel Holding AG. He also paid $10.4 billion in cash for a 25 percent stake in Swiss eye-care company Alcon Inc.
Novartis is interested in experimental drugs in the second and final stages of human trials, Jimenez said.
“The most important thing is organic growth and that you can produce your own pipeline,” Vasella said in the interview. “Of course, you have to proceed with your eyes wide open and look at every opportunity, but we wont alter our strategy.”
Novartis dropped 2.83 francs, or 5.5 percent, to 48.62 francs in Zurich trading yesterday. The stock is down 7.7 percent so far this year, compared with a 1 percent decline in the 18-member Bloomberg Europe Pharmaceutical Index.
Glaxos Acquisitions
Pfizers bid to buy Wyeth reflects the companys failure to offset looming generic competition to Lipitor, the companys best-selling cholesterol pill, using job cuts, new research priorities and sales in developing countries, analysts said.
“We dont consider it to be of great strategic importance for us directly,” Vasella said. “Pfizer has recognized that certain diversification is positive. For Pfizer, its the logical step to do. Either you grow externally or you grow internally as a main driver.”
Two days after Pfizer announced its bid for Wyeth, Roche Holding AGs majority shareholder agreed to keep its stake in one pool for an unlimited period, protecting Novartiss larger Swiss rival from a takeover as industry mergers are heating up.
The extension of the accord, which had been set to expire at the end of 2009, will make it difficult for other drugmakers, including Novartis, which owns a 33 percent stake, to consider an acquisition of Roche, the worlds biggest maker of cancer medicines. Cross-town rival Novartis spent $2.1 billion in 2002 to increase its holding. Vasella said at the time that a combination would produce “a great company.”