ADVFN - Advanced Financial Network.
HOME» NYSE » M » MRK Stock Price » MRK Stock News

Merck Share News

 Merck & Co., Stock Price
MRK Stock Price
 Merck & Co., Stock Chart
MRK Stock Chart
 Merck & Co., Stock News
MRK Stock News
 Merck & Co., Company Information
MRK Company Information
 Merck & Co., Stock Trades
MRK Stock Trades

Express Scripts-Medco Deal Could Pressure Drug Makers

--Express Scripts, Medco merger could increase pricing pressure on drug makers --PBMs have been gaining clout in drug-price negotiations --Drug makers increasingly focusing on differentiated new drugs By Peter Loftus Of DOW JONES NEWSWIRES Express Scripts Inc. (ESRX), with its planned $29.1 billion purchase of rival pharmacy-benefits manager Medco Health Solutions Inc. (MHS), is firing a shot across the bow of pharmaceutical companies that charge high prices for their drugs. Drug makers including Pfizer Inc. (PFE) and Merck & Co. (MRK)--already facing a slew of patent expirations for top drugs--may feel increased pricing pressure if the deal goes through because a bigger Express Scripts would have greater clout in negotiating discounts and rebates for prescription drugs on behalf of its clients. The deal also would reduce the number of big PBMs to two from three. "This consolidation brings extraordinary purchasing power for the combined company to leverage with pharmaceutical companies," said Michael Luby, chief executive of BioPharma Alliance, a West Conshohocken, Pa., firm that provides consulting services to drug makers. Drug makers may even seek to block the deal by raising antitrust concerns with regulators, said Damien Conover, analyst with Morningstar. The industry's lobbying group, Pharmaceutical Research and Manufacturers of America, declined to comment on the proposed deal. The trade group for generic drug makers also declined to comment. If the deal goes through, it could force drug makers to accelerate efforts to introduce differentiated new drugs that represent significant medical advances or treat rare diseases, rather than so-called "me-too" drugs that aren't much better than what is already available on the market. Drug makers believe they can command higher prices for innovative new drugs that have fewer viable alternatives than for drugs that are less distinctive, and many have already shifted their research-and-development efforts in this direction. Express Scripts's warning shot to the industry could be summed up in its statement Thursday that the Medco purchase would help "better protect American families from the rising costs of prescription medicine." So far, drug makers aren't expressing much fear of a combined Express Scripts-Medco. Eli Lilly & Co. (LLY) Chief Financial Officer Derica Rice said in an interview that it is too soon to say whether consolidation among PBMs will be tougher on drug manufacturers. Rice said Lilly could maintain its negotiating leverage against PBMs by selling differentiated drugs. He said Lilly's products have performed well despite the availability of cheaper generic drugs that PBMs have increasingly sought to promote. "We've seen no deterioration of that model even with generic competitors," Rice said. Drug prices have been a source of contention amid a larger national debate over rising health-care costs. Drug makers last year boosted U.S. prices for top brand-name drugs, such as Pfizer's Lipitor cholesterol pill, by nearly 7%, on average, the highest rate in a decade, according to Barclays Capital. Critics have called the price hikes excessive, while the companies say the prices are justified by the value of the drugs and the need to fund research and development of future treatments. But there also have been countervailing forces on drug prices, including competition from cheaper generics in the U.S. and mandatory price cuts imposed by cash-strapped national health programs in Europe. PBMs and health-care payers generally have gained clout over the past decade. In 2005, Express Scripts dropped Pfizer's Lipitor from its preferred-drug list, causing many of its members to switch to Merck's Zocor, which was about to lose patent protection and become available as a cheap generic. Lipitor sales took a hit, though Express Scripts later added the drug back to its list. Some PBMs have subjected big-selling drugs to greater scrutiny through their own research, rather than just rely on manufacturer-funded studies to judge efficacy and safety. Medco's research helped reveal that certain patients didn't respond well to blockbuster anticlotting drug Plavix based on their genetic makeup. The Food and Drug Administration added a strong warning about this risk to the Plavix prescribing label last year. Plavix is co-marketed by Bristol-Myers Squibb Co. (BMY) and Sanofi-Aventis SA (SNY). The clout of PBMs and insurers also has slowed some new drugs out of the starting gate. Eli Lilly's anticlotting drug Effient and Johnson & Johnson's (JNJ) antipsychotic Invega had slow starts after their introductions partly because benefit plans were skeptical about their value and didn't initially provide favorable coverage. -By Peter Loftus, Dow Jones Newswires; +1-215-982-5581; peter.loftus@dowjones.com --Thomas Gryta contributed to this article.

Stock News for Merck (MRK)
DateTimeHeadline
07/29/201416:48:45Pfizer Still Looking to Buy; Results Beat Views -- 2nd Update
07/29/201416:33:16MARKET SNAPSHOT: U.S. Stocks End Choppy Trade Lower
07/29/201410:39:16MARKET SNAPSHOT: U.S. Stocks Rise; Dow Above 17,000
07/29/201409:50:28MARKET SNAPSHOT: U.S. Stocks Open Higher; Dow Above 17,000
07/29/201409:33:23MARKET SNAPSHOT: U.S. Stocks: Futures Rise; Housing Prices Next
07/29/201408:15:52MARKET SNAPSHOT: U.S. Stocks: Futures Rise After Merck, Pfizer...
07/29/201407:09:18MARKET SNAPSHOT: U.S. Stocks: Futures Choppy Before Confidence...
07/29/201406:07:35MARKET SNAPSHOT: U.S. Stocks: Futures Decline Before Confidence...
07/07/201415:20:45Novartis Wins 'Breakthrough' Status for Leukemia Treatment
06/09/201417:14:14Merck to Buy Idenix for $3.85 Billion -- 7th Update
06/09/201416:58:36MARKET SNAPSHOT: U.S. Stocks Close Up; S&P 500, Dow At Record
06/09/201413:13:25Merck to Buy Idenix for $3.85 Billion -- 6th Update
06/09/201411:24:46Merck to Buy Idenix for $3.85 Billion -- 5th Update
06/09/201410:53:33MARKET SNAPSHOT: U.S. Stocks Edge Higher; S&P 500 Hits Record
06/09/201409:44:33Merck to Buy Idenix for $3.85 Billion -- 3rd Update
06/09/201409:44:31U.S. Hot Stocks: Hot Stocks to Watch
06/09/201409:00:14Merck to Buy Idenix for $3.85 Billion -- 2nd Update
06/09/201408:29:04Merck to Buy Idenix for $3.85 Billion -- Update
05/13/201407:40:16Merck to Sell Some Ophthalmology Assets
05/08/201410:10:37Merck Plans Phase 3 Trial for Drug for Bone Marrow Transplant...

Merck and other New York Stock Exchange stock quotes are delayed by at least 20 minutes.
All other stock price data is delayed by at least 15 minutes unless otherwise stated.
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions
Contact Us | Copyright 1999-2007 ADVFN PLC. | Privacy Policy | Investment Warning | Data accreditations | Investor Relations

ADVFNADVFN ItalyADVFN GermanyADVFN FranceADVFN BrazilADVFN JapanADVFN UKADVFN US noad