Health & Fitness
Health and Fitness
Health and Fitness
Thu, December 2, 2010
Wed, December 1, 2010
Tue, November 30, 2010
Merck KGaA, Teva Pharmaceuticals Industries, Biogen Idec, Elan and POSCO
CHICAGO--([ BUSINESS WIRE ])--Zacks.com Analyst Blog features: Merck KGaA (OTC: [ MKGAF ]), Teva Pharmaceuticals Industries Ltd. (Nasdaq: [ TEVA ]), Biogen Idec Inc. (Nasdaq: [ BIIB ]), Elan Corp. plc (NYSE: [ ELN ]) and POSCO (NYSE: [ PKX ]).
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Here are highlights from Mondaya™s Analyst Blog:
Merck KGaA MS Drug Faces Glitch
Merck KGaA (OTC: [ MKGAF ]) recently announced that the US Food and Drug Administration (FDA) extended the review period of cladribine by three months. The prescription drug user free act date, which was earlier set for November 28, 2010, has now been postponed to February 28, 2011. The regulatory body said that it needs more time to fully review the additional information provided by Merck KGaA on the candidate.
Merck KGaA is seeking approval for the use of cladribine for the treatment of relapsing-remitting forms of multiple sclerosis (MS).
The Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency (EMA) recommended against the approval of cladribine for the treatment of relapsing-remitting MS in September, citing safety concerns. The committeea™s negative opinion was based on its belief that the benefits to MS patients from the drug do not outweigh the risks that they will be exposed to on taking the drug.
Merck KGaA requested the EMA in October for a re-examination of the adverse recommendation issued by CHMP. The CHMPa™s negative opinion came as a rude shock to Merck KGaA given the fact that cladribine is approved in Australia and Russia for the treatment of relapsing-remitting MS. The drug is marketed as Movectro in these countries.
We currently have a Zacks #3 Rank (short-term Hold rating) on Merck KGaA. Though we view the extension of the review period for cladribine as a minor obstacle for the company, we believe that Merck KGaAa™s continuous investment in R&D, marketing and new product launches should help sustain earnings growth.
We are also of the opinion that the acquisition of Millipore reduces the companya™s dependence on pharmaceutical and liquid crystals sector and helps build its specialty chemicals and performance life sciences portfolio.
However, we note that the MS market is highly competitive with players like Teva Pharmaceuticals Industries Ltd. (Nasdaq: [ TEVA ]), Biogen Idec Inc. (Nasdaq: [ BIIB ]) and Elan Corp. plc (NYSE: [ ELN ]) already in the market with MS treatments.
POSCO Details Investment Plans
Korean steel producer POSCO (NYSE: PKX) provided details of its investment plans in South Korea, announced earlier at a board meeting held on November 19. The company will invest approximately KRW1.6 trillion (roughly US$1.4 billion) to develop, construct and operate a hot-rolled steel coil production line at its Gwangyang steelworks.
The facility, Gwangyanga™s No.4 hot-rolling mill, will enable POSCO to enhance its production capacity in the country and also tap the rising demand for high quality steel products. In addition, imports of high quality steel products from countries like Japan will be reduced.
The output from the mill will include automobile steel plates, oil steel pipes, high-strength steel, and wide strip steel. Slabs, the major input for hot-rolled mills, will be supplied from Gwangyang steelworks by reinforcing its steelmaking and casting capabilities.
The construction is expected to commence in September 2011 and end by January 2014. With an annual production capacity of 3.3 million tons of hot-rolled steel products, the mill will increase POSCOa™s annual hot-rolled coil production capacity from 23.54 million tons to 26.84 million.
We find POSCO well positioned to leverage from its expansion into the fast-growing markets in the long run. Its recent joint ventures (Krakatau Steel), acquisitions (Daewoo International), and increasing independency in raw material procurement (stake acquisition in Australiaa™s iron ore and coal mines) are very likely to be the companya™s prime growth drivers.
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