Product News and Recalls

Prozac maker going through tough times

An article on investment blog Seeking Alpha highlights some recent problems facing pharmaceutical giant Eli Lilly, which potential investors might want to consider.

According to the blog, test results for a new schizophrenia drug proved disappointing. So much so that the company halted research into the product.

A new treatment for Alzheimer’s proved only partially effective against a mild form of the disease, and useless in most cases. A recent study also revealed that the company’s blood thinner, Effient, wasn’t as good as Plavix, manufactured by Bristol-Myers Squibb.

All that means that the Eli Lilly will be losing money on its new drugs, rather than taking in additional revenue as company officials had planned.

Eli Lilly also faces legal problems centering on its highly profitable antidepressant, Prozac. Widespread lawsuits allege that Eli Lilly and other manufacturers of antidepressants classified as selective serotonin reuptake inhibitors, or SSRIs, failed to adequately warn pregnant patients of studies linking the drugs to potentially dangerous heart and lung defects in newborns.

SSRI antidepressants include Prozac and Zoloft.

In addition, according to Seeking Alpha, Eli Lilly is losing money because of a drop in revenue caused by the expiration of the patent on its Zyprexa schizophrenia drug. The company reported a 10 percent drop in global revenues in the second quarter of 2012.

The article states: “Eli Lilly is definitely not a value buy at this time; the company is clearly losing money by its own admission. To make matters worse, it seems poised to lose more money in the next year. The best advice is to stay away from this stock until the share price starts reflecting the reality at Eli Lilly.”

Patients should consult their doctors before making any changes in their medication. A consultation with an SSRI lawyer is also important if there are significant injuries from SSRIs.

See the article here: