Pfizer - zu Unrecht im Keller

Diese Hedge-Strategie nennt sich "Covered Call". Sie ist bei allen US-Brokern (z. B. Ameritrade, Etrade) möglich, die Optionshandel und Margin-Accounts anbieten. Ich hab mich zu diesem Hedge wegen der Unsicherheit bzgl. der Klagen, aber auch wegen der Index-Hochs, denen ich nicht traue, entschlossen. Würde Pfizer ab jetzt noch deutlich fallen, würde ich die geshorteten Calls für ein paar Cents zurückkaufen (sie fallen ziemlich schnell, wenn die Aktie fällt und die restliche Laufzeit knapp wird). Dann hätte ich Pfizer im Endeffekt für rund 25,50 USD gekauft. Ein idealer Rückkauftermin für die Calls wäre vermutlich kurz vor der Ranbaxy-Urteilsverkündung. Denn wenn Pfizer danach einen Riesensatz nach oben macht, ist es natürlich besser, nicht mehr auf den geshorteten Calls zu sitzen...

In the lawsuit, Ranbaxy must prevail over two Pfizer patents to win the right to sell a generic version of Lipitor. That is a high hurdle, especially when one of the patents covers the molecule itself, rather than the manufacturing process or therapeutic use.

Pfizer first obtained a patent on a molecule made up to two components; it later obtained a second patent on one of those components and marketed that as Lipitor. Ranbaxy argues that the first patent didn’t expressly cover the component. Because its copy only includes the component that mimics Lipitor, Ranbaxy says it doesn’t infringe on he initial patent. Pfizer maintains that the first patent covers the whole molecule and its components. The arguments on the second patent, however, provided new twists. Ranbaxy essentially says Pfizer shouldn’t have gotten the second patent because it was too much like the first one. Pfizer counters that, although the second patent was similar, the company deserved extra patent protection because the later version of the molecule had surprising advantages over the older one, a critical requirement for a patent. Specifically, Pfizer claimed that the later molecule showed a significant advantage in efficacy at lowering cholesterol than the older molecule.

But Ranbaxy attacked Pfizer’s scientific data on the cholesterol lowering and accused Pfizer of botching the tests and then cherry-picking the data. Ranbaxy maintains that if all the data were taken into account, the second molecule’s advantage wasn’t statistically significant, and therefore the second patent is illegitimate.

Pfizer said it submitted the most appropriate and reliable test results. And even if the rest of the data were taken into account, Pfizer argued, they only bolstered the case that the second version of the molecule was superior.

The judge peppered a key Pfizer witness-a chemistry expert who was supposed to justify Pfizer’s interpretation of the patents-with questions, causing him to make some statements that contradicted his previous testimony. Some analysts saw this as damaging to the witness’s credibility.

Ranbaxy declined to comment. A Pfizer spokesman said Ranbaxy presented “nothing new or surprising” in court. “Pfizer believes strongly that both patents in the litigation are valid and infringed and that, when all the evidence is considered, our position will be upheld”.  

Auch von Merck würde ich zurzeit lieber die Finger lassen.

Merck könnte durch das US-Schadensersatzrecht regelrecht demontiert werden. In Texas wurden der Klägerin rund 25 Mill. $ zugesprochen, rund neunmal mehr ging als Geldstrafe (punitive damage) an den Staat -> Gesamtstrafe: 253 Mio. Dieses Urteil wird andere Vioxx-Geschädigte ermutigen, ebenfalls zu klagen. Merck hat zwar viel Geld auf der hohen Kante, aber womöglich nicht genug, um die Klagewelle heil zu überstehen. Die Dividende kann man dann natürlich auch vergessen. Bei Wyeth und Schering-Plough musste sie, als die Firmen in Finanznöte kamen, stark reduziert werden.


Analysts Miss Legal Dangers of Merck
By James J. Cramer
RealMoney.com Columnist
8/22/2005 2:13 PM EDT
URL: www.thestreet.com/funds/smarter_up/10239076.html

The pain of reading these Merck (MRK:NYSE) pieces reminds me of why it was worth it to go to law school. At least I understand how little the analysts know about litigation.

There are several phases of litigation that seem to elude the sensibilities of analysts. Here's the primer of what you need to know about how the justice system really works.

First, federal judges are incredibly powerful. You get a federal judge who believes that Merck is the devil, that's the end of Merck. He or she can devise a novel remedy that includes taking the company from the shareholders and giving it to the aggrieved plaintiffs. That this is legal and possible is simply never discussed by any of these "analysts." Makes me furious, especially because it happened once already, with AH Robins, which got taken away from shareholders and given to the women who were harmed by using Robins' Dalkon Shield.

Second, federal prosecutors are incredibly powerful. You get a rogue prosecutor who decides to go after Merck criminally -- heck, even go after it for manslaughter in some form -- you end up with some verdicts that easily could put the company under. Why people don't believe this could happen is a testament to how naive we are about the power of the government. It is all-powerful, and not pro-capitalist.

Third, you could have people who didn't want to sue Merck because they believed that they could never win now calling lawyers. When we got a few wins against tobacco, we suddenly had litigation floodgates open and we got two decades of lawsuits that finally are winding down.

All of these factors make the question of "the dividend" a bit of a joke. Who knows? The company may have very little say in this once the Pandora's box of litigation is opened. Any assurances are simply irresponsible.

What drives me crazy, of course, is that when I say this stuff aloud on television, people brand me irresponsible. How funny is that? The only irresponsibility is on the part of those analysts who simply refuse to recognize how out-of-control litigation is in this country and how powerless companies are to stop both plaintiffs and prosecutors.

Based on projected earnings, Ryan calculates a victory for Pfizer could send its stock price up to $33 a share, while a loss could send it dropping to $21. She says investors, pricing the stock at $27, midway between her two targets, are effectively betting as if the company faces 50/50 odds.

Pfizer, the world's biggest drug company is waiting for verdicts in multiple court battles with Indian generic drug maker Ranbaxy Laboratories (Research) . It's a classic David versus Goliath scenario -- Pfizer's revenues are about 50 times the size of its diminutive challenger. The challenges to the Lipitor patents are being waged in a U.S. district court in Delaware as well as a British court. The trial phases in both of these cases have come to a close, and the companies are awaiting judges' rulings, which could come by the end of the year.

Pfizer holds at least two patents for Lipitor, which are scheduled to expire in 2010 and 2011. Bernstein analyst Richard Evans favored Pfizer over Ranbaxy 80/20 in defending the later patent, and favored Pfizer with 90/10 odds in defending the earlier patent.

"To get generic Lipitor on the market, [Ranbaxy] has to defeat them both," said Evans. "It's a long shot."

These projected odds contrast with the industry average, according to the Generic Pharmaceutical Association, which said that generic companies win patent litigation fights 75 percent of the time. The GPA was not immediately available to provide an estimate for the Pfizer-Ranbaxy battles.

The court battles carry massive implications for the world's biggest drug maker and the world's top-selling drug.

Lipitor, which is designed to lower cholesterol, totaled $10.8 billion in 2004 sales, the first drug ever to surpass $10 billion. Deutsche Bank projects Lipitor sales will grow to $14.2 billion in 2007 if Pfizer successfully holds its patents, translating into annual earnings of $2.54 per share. But if Pfizer loses, it could face a $8.6 billion plunge in annual sales by 2007, most of it in U.S. revenue, resulting in annual earnings of $1.64 per share, according to Deutsche Bank. Bernstein's projections for Pfizer are similar.

If Ranbaxy succeeds in proving the patents invalid, it could have a generic version of the drug on the market as early as 2007, said Deutsche Bank analyst Manish Jain in a Tuesday conference call. Jain said that Ranbaxy faces a 25 percent downside to its stock price if it fails in its patent fight, but in a show of confidence the company's founding family recently fattened its Ranbaxy holdings to 4 percent.

Lipitor's name-brand competitors, such as Crestor and Vytorin, would also suffer declining sales as patients switch to cheaper generics, and the drugmakers' stocks would sell off 3 to 4 percent, said Deutsche Bank analyst Mark Purcell.

Crestor, an aspiring blockbuster from AstraZeneca (up $0.27 to $45.30, Research), made $908 million in 2004. Another competitor entered the market last summer: Vytorin, a combination of Zetia, a Schering-Plough (up $0.20 to $21.16, Research) drug that stops cholesterol absorption into the liver and intestine, and Merck (down $0.09 to $30.59, Research)'s Zocor.

Despite its reputation as a no-settlement company, Pfizer could try to settle with Ranbaxy outside of court for as much as $2 billion, said Ryan, staving off heavier damages in the event of patent losses.

"Pfizer clearly is a company with tremendous disregard for the generic drug industry and is not given to settling," said Ryan. "But it is not altogether unlikely that Pfizer could settle its litigation. If Pfizer could translate some of its cash hoards into greater certainty on this litigation ... I think they would do that."

Manish said that Pfizer's other option, attempting to acquire Ranbaxy, is unlikely, because the drug giant would rather settle or take its chance in court than pay Ranbaxy's estimated $4 billion price tag.

Pfizer spokeswoman Vanessa Aristide would not respond to analyst projections. "This is all speculative thinking and we just don't comment all that," said Aristide.

Evans does not own stock in these companies but Bernstein conducted business with at least one of them in the last year.