Healthcare Sector Review: Pfizer and Merck Up

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Regeneron Pharmaceuticals (NASDAQ:REGN): Regeneron Pharmaceuticals CEO Len Schleifer gives insight into how big pharma deals with the sticky issue of motivating doctors to load up on drug inventory when they face lengthy waits for reimbursements from insurance firms and Medicare. According to Schleifer, doctors are given “long-dated commercial terms” to keep sales flowing. The shares closed at $74.44, up $8.96, or 13.68%, on the day. Its market capitalization is $6.89 billion.

Hi-Tech Pharmacal Co. (NASDAQ:HITK): After rival Wockhardt says it gained FDA approval for a generic copy of GlaxoSmithKline’s Flonase nasal spray, which could dampen sales of Hi-Tech Pharmacal’s own generic offering, Pharmacal’s stocks drop sharply. The shares closed at $35.31, down $6.53, or 15.61%, on the day. Its market capitalization is $458.68 million.

Health Management (NYSE:HMA): More on the turmoil at Health Management Associates: Allegations made by a whistleblower who alleges that he was fired for reporting repeated Medicare overbilling issues has helped a lawsuit that unsettled shares of HMA. Though these allegations add concern to federal subpoenas HMA received earlier this year, Susquehanna’s A.J. Rice sees a silver lining in the panic-selling, telling clients an “extraordinary buying opportunity” exists. The shares closed at $6.05, down $0.91, or 13.07%, on the day. Its market capitalization is $1.54 billion.

Gentiva Health Services (NASDAQ:GTIV): Robert W. Baird has lowered both Gentiva Health Services and Amedisys (NASDAQ:AMED) to Underperform from Neutral. Investors materially underestimate the risk to therapy cuts, and the sector still seems to price in too optimistic an outlook for 2012. This leaves the risk that any negative announcement “could drive a material amount of downside” in shares. The shares closed at $6.73, down $0.62, or 8.44%, on the day. Its market capitalization is $207.25 million.

Pfizer Inc. (NYSE:PFE): CEO Ian Read says that Pfizer’s Lipitor cholesterol drug is, “basically where we expected to be,” holding onto ~37%-38% of the overall U.S. market while competing with generic versions. Yet he says it will be difficult for Pfizer to increase its current hold, stating that some patients are encountering resistance at pharmacies hoping to fill prescriptions. The shares closed at $21.94, up $0.12, or 0.55%, on the day. Its market capitalization is $168.65 billion.

Merck & Co., Inc. (NYSE:MRK): According to Roger Pomerantz, Merck’s global head of licensing and acquisitions, the drugmaker’s goal is  to ursue whatever deals are necessary to be a leader in the treatment of hepatitis C. The shares closed at $38.52, up $0.13, or 0.34%, on the day. Its market capitalization is $117.41 billion.

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