Business deals amaze me and in this economy the deals are getting really crazy. The giant drug company, Pfizer, bought Wyeth, another drug company, for $68 billion (That’s with a b). An equity strategist made a really dumb remark I think when he said something like just because of this deal don’t think we’ll see more because it’s a difficult
If we are in such a mess then how come one of them has $68 billion on hand to buy out the other? This is my opinion (only) but I say they see what’s coming: universal health care and much tighter controls where they will no longer be able to charge any price they feel like. I’m not against universal health care by any means but I am against what looks like a monopoly. . Pfizer is the maker of Lipitor and Viagra. Wyeth makes the popular anti depressant drug, Effexor as well as the popular Prevnar vaccine against childhood infections and the very popular arthritis drug, Embrel. Wyeth is also into vaccines and biotech drugs which Pfizer is not so this will help Pfizer expend its giant piece of the drug world.
Now Pfizer has to answer to me – if someone is listening to me….How the heck can you look yourselves in the mirror every day when you just spent and unG-dly amount of money in the name of capitalism and then tell us you are going to cut 10% of your workforce all over the world. That translates to about 8,000 jobs and shutting down some sites that manufacturer the drugs. And I’m certainly not playing a violin for you when you cry because you have had a 90% loss in your fourth quarter to $269 million (remember that is just one quarter). That’s because of a legal settlement that cost them over $2 billion. On top of that certainly jobs will be lost with this merger. Where will the Wyeth employees go? I cannot imagine that Pfizer will absorb them especially since they are cutting their own workforce.
Pfizer bought Wyeth through loans from banks and lowering dividends. (That’s money you might get.) They’ll also pay via cash and stock.
In the meantime if you own stock in Pfizer you’ve made money because their shares were selling at 40 cents and they are now at 65 cents a share. Maybe this happened with the upcoming news of this merger. Perhaps we should get on the bandwagon and all buy Pfizer shares. If you do tell me when to sell, please!
This merger is the largest on Wall Street in recent times and the biggest merger in the drug company arena.
There are conflicting ideas about whether this will spawn other mergers. As a consumer I don’t think my mom can continue paying $300 a month for her drugs so if this isn’t going to help us then who will? Hopefully President Obama with help with health care at the forefront of his very long agenda.