Archive for May 8th, 2009

Glaxo, Pfizer Hook-up on AIDS

May 8th, 2009 | No Comments | Source: Forbes

British drug giant GlaxoSmithKline is joining forces with American rival Pfizer to lock down some 20% of the drug market for HIV/AIDS. That should help put the 2 companies on the map in an area that has been thoroughly dominated in recent years by the rising star, Gilead.

gskThe tie-up calls for GSK to hold 85% of the JV, which will be based in London and be run by Dominique Limet, currently of GSK.

It will have working capital of about $370 million.

The UN estimates that 33 million people worldwide carry HIV.

Raymond James analyst Eric Le Berrigaud was bullish on the move, especially given GSK’s tottering position in this market.

“In having access to Pfizer’s research and development [of AIDS treatment], Glaxo will try to mitigate the downward trend of its HIV/AIDS sales as its patents start expiring over the next five years,” Le Berrigaud told Forbes.

pfizerGlaxo’s current sales in HIV/AIDS have topped out at $2.2 billion, but they are likely to drop by 60% or more by 2014 due to patent expirations of old standbys Retrovir, Epivir and Ziagen.

The deal “could perhaps add another half billion [to Glaxo’s sales],” estimated Le Berrigaud.

Gilead has been on a tear in recent years, due to its trio of HIV drugs, all of which leverage tenofovir, which is prescribed in one form or another for 80% of new HIV patients in the US, and nearly that many in the EU.

HHS guidelines recommend that Gilead’s drugs be used as backbone therapy for HIV/AIDS, in part because they can be taken once daily which helps improve compliance.



Big Insurers’ Panels Headin’ South

May 8th, 2009 | No Comments | Source: Wall Street Journal

In Q4 2008, WellPoint lost 288,000 covered lives, half of which were caused by rising unemployment and lost employee benefits.

floodofbadnews“Economic conditions will continue to deteriorate and unemployment will continue to increase,” CEO Angela Braly sighed to analysts at the time. “This will impact commercial membership in 2009.”

She got that right.

The nation’s largest private insurer, which covers nearly 35 million lives, reported last week that it lost nearly half a million more members in Q1 2009, nearly 65% of which were due to layoffs or employees simply opting out of employer coverage.

That jaw-dropper was topped the next day by UnitedHealth Group Inc., the second largest insurer. The Minnesota-based company reported a drop of 900,000 in the number of people enrolled in its commercial health plans.

The news prompted economists to estimate that the uninsured population has swelled by at least 4 million people since the 2007 estimate by the Census Bureau pegged the number at 45.7 million.

The Kaiser Family Foundation estimates for example that for each percentage-point increase in the unemployment rate, the population of uninsured Americans grows by 1.1 million.

The findings were confirmed by Tenet Healthcare, a hospital chain that recently reported a 2% drop, year-over-year, in the number of admissions of patients with private coverage.

“It’s probably not a surprise that with all these people losing jobs, a lot will lose their health insurance,” Paul Ginsburg, president of the Center for Studying Health System Change told the Wall Street Journal.


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