Merck's Big Day: A Share Buyback and FDA Panel Approval
Merck's Big Day: A Share Buyback and FDA Panel Approval [the Philadelphia Inquirer]
From Philadelphia Inquirer (PA) (April 28, 2011)
April 27--Merck & Co. Inc., said Wednesday morning that it would spend $5 billion to buyback shares. Then, in the afternoon, it won a recommendation from a Food and Drug Administration advisory panel for its highly-anticipated hepatitis C drug.
"Merck has a history of leadership in returning cash to shareholders," Kenneth C. Frazier, Merck's president and chief executive officer, said in a statement. "Together with our strong dividend, today's action reflects our confidence in Merck's strategy and demonstrates our commitment to delivering shareholder value."
Merck, which has operations in Philadelphia suburbs, saw its stock rise 57 cents in trading Wednesday, closing at $35.63.
The FDA advisory panel voted 18-0 to recommend boceprevir, which will have the brand name Victrelis, as a more effective treatment than those available at the moment. The FDA usually follows such recommendations, but is not required to so. A decision might come in May.
"I feel the benefits outweigh the risks and there is clearly a need," said panelist Kathleen Young, the executive director of the Alliance for Prudent Use of Antibiotics, in Boston.
Merck faces stiff competition, including from Vertex Pharmaceuticals Inc., whose similar drug will be reviewed by the panel on Thursday.
Despite the unanimous vote, panel members expressed concern about side effects, including anemia, the complexity of the treatment for all patients and what some said was thin evidence that the drug helps those who have not been cured by other treatments.
"You do have to be a bit of a Talmudic scholar to prescribe this, but that has a certain appeal to me," said Dr. Lawrence S. Friedman, who works at hospitals in Boston, teaches medicine at Harvard and Tufts and was among the 18 to vote to recommend. "You would like it to be simple and easy to remember, not complicated. Despite my appreciation for Talmudic scholarship, I'd really rather keep it in my head."
The hepatitis C virus affects 130 million to 170 million people worldwide -- about four times the number with HIV/AIDS -- and kills about 350,000 people a year because of damage to the liver, according to the World Health Organization.
Chronic hepatitis C affects about 3.2 million Americans. Merck's drug, if approved would be for adults, but the disease shows up in infants and children of adults who carry the virus.
"I look forward to a pediatric" version, said Dr. Russell B. Van Dyke, head of pediatric infectious diseases at Tulane University School of Medicine.
Merck researchers in North Wales and Kennilworth, N.J. were among the hundreds who worked on the drug, which they hope will improve on a two-drug cocktail that has been used for more than a decade.
"The positive recommendation brings us one step closer to bringing Victrelis to men and women who need it, and reinforces our ongoing commitment to developing innovative therapies to treat chronic hepatitis C," Peter S. Kim, president of Merck Research Laboratories said in a statement. "We're pleased with the panel's decision and look forward to working with the FDA as it continues to evaluate the application for Victrelis."
Contact staff writer David Sell at 215-854-4506 or email@example.com.
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Posted: April 2011
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