Tuesday, August 7, 2012

2 Bluechip Pharma Stocks: Johnson & Johnson (NYSE:JNJ) & Pfizer (NYSE:PFE)

Johnson & Johnson (NYSE:JNJ) and Pfizer Inc.(NYSE:PFE) declared on Monday that they are putting an end to the development of bapineuzumab, a drug that was once considered capable of treating Alzheimer’s disease. This comes after the treatment failed in two-phase clinical trials.

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Both the companies had hoped that the drug would help in slowing the process of physical and mental dementia in people who have Alzheimer’s, but it did not seem to work better than a placebo in the two-stage medical trials in patients, who were diagnosed with mild to moderate Alzheimer’s disease.  Johnson & Johnson had agreed to invest a lofty amount of $1.5 billion in the initial stage.

Bapineuzumab is designed to prevent the plaque formation in brain. Other treatments for Alheimer’s are only capable of easing the symptoms of the disease temporarily. This includes loss of memory, wandering, aggression and confusion.

On july 23rd, both the companies had said that the drug had failed in a different examination. All the simultaneous studies are now being discontinued. Johnson & Johnson said it will take control of $300 million to $400 million in the third quarter. Elan Corp., based in Dublin that had licensed the drug to Johnson & Johnson will take charge of $117.3 million.

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In the most recent trial, bapineuzumab was tested on about 1300 Alzheimer’s patients, who did not have a gene that is linked with a risk of the disease. The companies had realized last month that the drug is also not working on people, who have that gene.

Globally, around 35 million people are suffering from dementia. Alzheimer’s is the most common type. About 5 million people in the US have Alzheimer’s. Finding a drug that is capable of controlling this disease would set up a milestone in the medical history. Such a drug is believed to be able to generate billions of dollars in annual sales.
Shares of PFE slid 1.70% to $23.85 and JNJ fell 0.71% to $68.35.

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