Replies to post #128809 on Biotech Values

[biomaven0]

Moreover, the proprietary pharma successor company will derive about 50% of its profits from one drug: Humira.

Makes it potentially very vulnerable to the oral RA drugs if they turn out to be successful.

Peter

[flatlander_60048]

What did you make of the $1.5B litigation reserve for improper marketing of Depakote?

http://www.chicagotribune.com/business/breaking/chi-abbott-books-15-billion-charge-for-potential-settlement-20111019,0,5684463.story

[ciotera]

RE: Musings on ABT’s split-up

Might be a good buying opportunity if the market overreacts and depresses the price of the proprietary pharma successor when it starts trading. Agree that Humira risk (as far as FOBs are concerned) is overblown and the pipeline looks very solid (relative to other big pharma).

[jbog]

Dew,

Moreover, the proprietary pharma successor company will derive about 50% of its profits from one drug: Humira. It will be the biggest-selling drug in the world (#msg-64677120), but it’s still only one drug, which is an inordinate amount of concentration for a company that is expected to have about $20B in annual sales.

That is exactly WHY they would want to distance themselves from pharma.



As a second point, these guys aren't currently being paid from the EU. Spanish local governments haven't paid their bills in over a year, and they are playing chicken with big Pharma to see if they get cut off. ((Spain’s regional governments owe 5.4 billion euros for medicines supplied to hospitals and are paying bills an average of 430 days late, Arnes said. That debt, as at June 30, increased from 5.19 billion euros at the end of March, when the average delay was 410 days, according to the group’s statistics.))

[DewDiligence]

Check out this pearl of wisdom about spinoffs:

http://online.wsj.com/article/SB10001424052970203752604576641390400362466.html

"During times of market volatility, a spinoff can provide a more certain path than a sale because you don't have to find a buyer," says Eduardo Mestre, vice chairman at Evercore Partners.

LOL—you don’t say.

[DewDiligence]

ABT spinoff factoids re The Global Demographic Tailwind:

• The diversified products successor company (the one that will continue to be called Abbott) will derive 47% of sales from emerging markets in 2014, up from 39% currently.

• ABT’s nutritionals business, which comprises about a quarter of the diversified products successor company, will have $1B of sales in China alone by 2014.

Source: http://media.corporate-ir.net/media_files/irol/94/94004/presentations/Abbott_Investor_Day_2011.pdf