After being plagued by a myriad of ills, pharmaceutical firms posted a series of lacklustre earnings figures which saw the sector fall further on international markets.
Concerns over increasing generic competition, research difficulties for major drugs and a more stringent regulatory environment have led to the industry’s major players losing their image as a safe defensive investment bolt-hole.
The major European and US drugmakers listed on the American Stock Exchange Pharmaceutical Index have seen a collective fall of 125 in 2008.
Pfizer and Eli Lilly have been hit by generic competition to their big sellers, GlaxoSmithKline and Amgen have safety worries over major products and AstraZeneca and Wyeth have suffered research disappointments.
Disappointing sales from Pfizer and Roche and Forest Laboratories led to pharma stocks being dumped, while it required the weak dollar to boost Johnson & Johnson’s poor sales.
Most of big pharma’s other major players are due to report this week: Merck & Co, Novartis and Eli Lilly on Monday; Wyeth on Tuesday; and Glaxo and Schering-Plough on Wednesday.
Analysts have predicted poor sales at Glaxo, the world’s number-two drugmaker, with demand for the Avandia diabetes treatment hit by last May’s safety scare.
Meanwhile, Merck, Novartis and Wyeth’s profits are expected be hit by cheap generic competition.
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