High & Low Finance Derivative Profits for Dealers Lead To Complexity & Secrecy
Date: Friday, June 26, 2009, 12:02 PM
PLEASE FORWARD FAR AND WIDE
http://www.nytimes.com/2009/06/26/business/26norris.html?hp=&pagewanted=all
By FLOYD NORRIS
Published: June 25, 2009
In the world of derivatives, profits for the dealers come from complexity and secrecy.
As a new regulatory system for derivatives is shaped on Capitol Hill, the banks will try to preserve as much of both as they can. To the extent they succeed, it will be the customers, and the financial system, that are at risk. Already the banks seem to be winning one important battle, that of explaining why derivatives exist.
In Congressional testimony this week, Mary Schapiro, the chairman of the Securities and Exchange Commission, and Gary Gensler, the chairman of the Commodity Futures Trading Commission, laid out the case for extensive regulation. But they also had kind words for the products. Derivatives, Ms. Schapiro said, allow parties to hedge and manage risk, which itself can promote capital formation.
For some derivatives, that is true. But the generalization is not always accurate, and there needs to be consideration as to whether some derivatives deserve to exist at all.
Simply put,said Richard Bookstaber, one of the pioneers of financial engineering on Wall Street, “derivatives are the weapon of choice for gaming the system."
Mr. Bookstaber wrote one of the best books about the causes of the financial crisis, "A Demon of Our Own Design," and did so before the crisis erupted. This month, his testimony to a Senate subcommittee provided a stark lesson in the uses to which derivatives have been put.
Derivatives,he testified, provide a means for obtaining a leveraged position without explicit financing or capital outlay and for taking risk off-balance sheet, where it is not as readily observed and monitored.They let institutions dodge taxes and accounting rules.
Viewed in an uncharitable light,he added, derivatives and swaps can be thought of as vehicles for gambling; they are, after all, side bets on the market.
And they were side bets that could destabilize the markets. Had American International Group been gambling in regulated markets, it would have been required to put up collateral when prices began to go against it. Instead, it was able to ignore the problem until its own collapse and perhaps that of the financial system was imminent.
Even when derivatives do allow financial risks to be transferred, that is not always a good thing. John Kay, a leading Scottish economist, noted recently that he used to teach along with most other economics professors, that derivatives allowed risks to be transferred to those better able to bear them. But, he added, experience had shown that to be wrong. Now, he said, he teaches that derivatives allow risk to be shifted from those who understand it a little to those who do not understand it at all. That is not a bad description of how the risks of bad mortgage loans were transferred from those who made the loans to those who bought troubled collateralized debt obligations.We would be much better off as a society if that particular transfer of risk had been regulated, or even prevented. At a minimum, there should have been a lot more disclosure about just what was going on.
The Obama administrations outline for bringing the derivative markets under regulation addresses all the important issues. But the details, to be worked out in legislation and later in regulations, will be critical. Wall Street will try to keep as much of the market as possible from moving to exchanges, where prices would be transparent and those taking risks would have to put up collateral immediately when prices moved against them.
Instead, the derivatives industry has already started a public relations campaign claiming that it is helping businesses, particularly small ones, hedge their risks by devising custom derivatives and not requiring the customers to post liquid assets when they begin to lose money. They argue that forcing companies to put up cash when they gamble would take money away from the companies’ productive investments, and thus damage the economy.
It would also mean that those gambles could not destroy the companies making them. All too often, Wall Street has come up with complicated vehicles with little upfront costs but huge potential risks, and made lots of money on them from customers who are in no position to assess the fair value of the derivative or to bear the losses if the risks materialize.
The Obama administration has embraced the principle that complicated, illiquid derivatives should require higher margins from customers. If there is to be effective regulation, it is critical that the administration prevail on that issue.
It is also important that as much derivative trading as possible be pushed into standardized, exchange-traded contracts. The customers should be demanding that, simply because it would reduce their transaction costs, but many have been persuaded by the claim that customized products serve their needs better.
And sometimes the customers like the complexity. It makes it easier to hide the risks and leverage they are taking, as well as the noneconomic objectives such as evading regulations that they may prefer not be noticed by authorities.
Given the overlaps of the derivatives, commodities and securities markets, nearly everyone who has studied the issue thinks it would make sense to merge the S.E.C. and the C.F.T.C. But the agencies are overseen by differing Congressional committees that wish to retain their influence, and the campaign contributions that influence attracts. The administration evidently decided that was not a fight worth making.
Instead, Ms. Schapiro and Mr. Gensler hammered out a general agreement on which agency should regulate which product. Its not perfect, but it could work, particularly if the regulators hire people, such as Mr. Bookstaber, who understand how the games are played.
There could even be an advantage for the public in multiple regulators. Back in the Clinton administration, when Wall Street was persuading Congress to allow derivatives to escape nearly all oversight, the chairman of the C.F.T.C., Brooksley Born, sounded the warning about the risks of that course. She lost. Had she prevailed, the financial disaster might not have happened.
In the future, it is at least possible that if one agency is effectively taken over by those it regulates, the other might be able to protest and get public attention.
Despite the clear evidence that Warren Buffett was right when he called derivatives â financial weapons of mass destruction. There has been little talk of giving regulators authority to ban some derivatives.
Perhaps, however, the Obama administration has that idea up its sleeve. Its white paper on financial regulation calls for authority to prevent market manipulation, fraud, and other market abuses.My efforts to find out just what is included in that last catch-all category were not successful.
When the derivatives industry was persuading Washington to let it alone, one argument was that any American rules would just drive business overseas, hurting American competitiveness. That argument will be heard again, and makes it necessary that there be international regulatory cooperation. But the fact that some market allows something is not enough to prove everyone should allow it.
For far too long, Wall Street was allowed to play as it wished. It is a major understatement to say that privilege was abused. The details of derivatives regulation adopted this year will go a long way to determining whether and when the next financial crisis will engulf the world.
Floyd Norris comments on finance and economics in his blog at nytimes.com/norris, and you can go there now by clicking on the title above.
Thursday, July 2, 2009
Raymond James Financial, Inc RJF Securities Stock Fraud
Company: Raymond James Financial, Inc
Ticker Symbol: RJF
Class Period: Apr-22-08 to Apr-14-09
Date Filed: Jun-29-09
Lead Plaintiff Deadline: Aug-28-09
Court: Southern District of New York
Allegations:
An investor in Raymond James Financial, Inc., has filed a proposed securities class action lawsuit in the United States District Court for the Southern District of New York on behalf of all purchasers of the common stock of Raymond James Financial between April 22, 2008 and April 14, 2009 against Raymond James Financial and others over alleged violations of Federal Securities Laws.
According to the complaint the plaintiff alleges that Raymond James Financial and certain of its officers and directors are charged with issuing a series of materially false and misleading statements in violation of Section 10(b) and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder.
On April 14, 2009, Raymond James Financial shocked investors when it announced that results for the second fiscal quarter ended March 31, 2009, would be well below the consensus analysts' estimates, so the lawsuit. The plaintiff also alleges that Raymond James Financial announced that both its commercial and residential portfolios would require higher loss reserves, with the loan loss provision tripling from the previous quarter and in response to such an unexpected sharp increase in loan loss provisions, Raymond James Financial shares declined.
Raymond James Financial closed down $2.57 per share, or 13.48%, to close at $16.49 per share on April 15, 2009. Over the next few days, Raymond James Financial stock price traded as low as under $15 per share, well below its highs of over $38 per share between April 22, 2008 and April 14, 2009.
If you acquired the securities of the defendants during the Class Period you may, no later than the Lead Plaintiff Deadline shown above, request that the Court appoint you as lead plaintiff through counsel of your choice. You may also choose to remain an absent class member. A lead plaintiff must meet certain requirements.
Raymond James Financial, Inc RJF Securities Fraud Legal Help
Click on title above for free evaluation of your possible case;
https://www.lawyersandsettlements.com/submit_form.html?label=raymond-james-financial-inc-rjf-securities-2
Ticker Symbol: RJF
Class Period: Apr-22-08 to Apr-14-09
Date Filed: Jun-29-09
Lead Plaintiff Deadline: Aug-28-09
Court: Southern District of New York
Allegations:
An investor in Raymond James Financial, Inc., has filed a proposed securities class action lawsuit in the United States District Court for the Southern District of New York on behalf of all purchasers of the common stock of Raymond James Financial between April 22, 2008 and April 14, 2009 against Raymond James Financial and others over alleged violations of Federal Securities Laws.
According to the complaint the plaintiff alleges that Raymond James Financial and certain of its officers and directors are charged with issuing a series of materially false and misleading statements in violation of Section 10(b) and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder.
On April 14, 2009, Raymond James Financial shocked investors when it announced that results for the second fiscal quarter ended March 31, 2009, would be well below the consensus analysts' estimates, so the lawsuit. The plaintiff also alleges that Raymond James Financial announced that both its commercial and residential portfolios would require higher loss reserves, with the loan loss provision tripling from the previous quarter and in response to such an unexpected sharp increase in loan loss provisions, Raymond James Financial shares declined.
Raymond James Financial closed down $2.57 per share, or 13.48%, to close at $16.49 per share on April 15, 2009. Over the next few days, Raymond James Financial stock price traded as low as under $15 per share, well below its highs of over $38 per share between April 22, 2008 and April 14, 2009.
If you acquired the securities of the defendants during the Class Period you may, no later than the Lead Plaintiff Deadline shown above, request that the Court appoint you as lead plaintiff through counsel of your choice. You may also choose to remain an absent class member. A lead plaintiff must meet certain requirements.
Raymond James Financial, Inc RJF Securities Fraud Legal Help
Click on title above for free evaluation of your possible case;
https://www.lawyersandsettlements.com/submit_form.html?label=raymond-james-financial-inc-rjf-securities-2
Kucinich exposes disastrous use of TARP funds
Kucinich exposes disastrous use of TARP funds Kucinich opened with
Posted by: "ranger"
Tue Jun 30, 2009 10:51 pm (PDT)
Kucinich opened with this salvo, "When the American people find that
their tax dollars, which were supposed to be used to get us out of this
financial crisis, instead are being used to ship jobs and investments
overseas, there will be outrage." His comments are contained in the
subcommittee's report released on March 9, 2009. The subcommittee's
report accused banks of spending Troubled Asset Relief Program (TARP)
money on "questionable transactions" and criticized the Treasury
Department for inadequately supervising them.
Questioning the propriety of Treasury's scheme, the subcommittee zeroed
in on an $8 billion Citigroup Inc. loan to Dubai, a $7 billion Bank of
America investment in China Construction Bank Corp., and a $1 billion
investment in India by J.P. Morgan. The three financial institutions got
a total of $120 billion in tax dollars through the bailout program.
Although not illegal, Kucinich questioned the wisdom of transactions
that direct money to foreign governments rather than the domestic
economy.
"How does a multibillion financing deal to Dubai ease the liquidity
crisis in the United States of America? The report took shots at other
spendthrift gimmickry of banks, "What about other kinds of uses of TARP
funds: corporate spending on lavish parties, the continuation of
contractual agreements to pay for naming rights on professional sports
stadiums, corporate sporting event sponsorships?"
Kucinich bulls-eyed "significant shortcomings in Treasury ?s oversight
in dispersing money through TARP." The committee report asserted that
the department hasn't questioned any TARP recipient about its use of the
money. "In spite of broad investigative and audit authority, Treasury
has chosen not to request detailed and comprehensive information from
TARP recipients about the use of funds. As a result, Treasury has
limited ability to detect or prevent waste and abuse."
The report also put Goldman Sachs's $2 billion repurchase of its own
stock in December in its cross hairs. The repurchase caused Goldman
Sachs share value to increase almost 20%. That was a significant
financial benefit for senior executives, who own large amounts of
company stock. Congressional investigators are looking at whether this
insider deal was an inappropriate way to enrich those top employees
despite a public clamor for strict limits on executive compensation.
"This is a textbook definition of a taxpayer's nightmare."
______________________________________________
Posted by: "ranger"
Tue Jun 30, 2009 10:51 pm (PDT)
Kucinich opened with this salvo, "When the American people find that
their tax dollars, which were supposed to be used to get us out of this
financial crisis, instead are being used to ship jobs and investments
overseas, there will be outrage." His comments are contained in the
subcommittee's report released on March 9, 2009. The subcommittee's
report accused banks of spending Troubled Asset Relief Program (TARP)
money on "questionable transactions" and criticized the Treasury
Department for inadequately supervising them.
Questioning the propriety of Treasury's scheme, the subcommittee zeroed
in on an $8 billion Citigroup Inc. loan to Dubai, a $7 billion Bank of
America investment in China Construction Bank Corp., and a $1 billion
investment in India by J.P. Morgan. The three financial institutions got
a total of $120 billion in tax dollars through the bailout program.
Although not illegal, Kucinich questioned the wisdom of transactions
that direct money to foreign governments rather than the domestic
economy.
"How does a multibillion financing deal to Dubai ease the liquidity
crisis in the United States of America? The report took shots at other
spendthrift gimmickry of banks, "What about other kinds of uses of TARP
funds: corporate spending on lavish parties, the continuation of
contractual agreements to pay for naming rights on professional sports
stadiums, corporate sporting event sponsorships?"
Kucinich bulls-eyed "significant shortcomings in Treasury ?s oversight
in dispersing money through TARP." The committee report asserted that
the department hasn't questioned any TARP recipient about its use of the
money. "In spite of broad investigative and audit authority, Treasury
has chosen not to request detailed and comprehensive information from
TARP recipients about the use of funds. As a result, Treasury has
limited ability to detect or prevent waste and abuse."
The report also put Goldman Sachs's $2 billion repurchase of its own
stock in December in its cross hairs. The repurchase caused Goldman
Sachs share value to increase almost 20%. That was a significant
financial benefit for senior executives, who own large amounts of
company stock. Congressional investigators are looking at whether this
insider deal was an inappropriate way to enrich those top employees
despite a public clamor for strict limits on executive compensation.
"This is a textbook definition of a taxpayer's nightmare."
______________________________________________
Clear Airport Security Provider Faces Class Action
Verified Identity Pass, the parent company of airport security provider Clear, has been served with a class action lawsuit over reimbursement of its US$199 annual fee. The company, founded in 2005, closed its airport kiosks last week, permanently, leaving customers to fend for themselves.
Clear operated the Registered Traveler program in 20 airports, serving a reported 260,000 customers. The company pre-screened frequent fliers taking fingerprints, iris sans and credit information on customers which it then gave to the US Transportation Security Administration, in order to fast track people through the security line-ups.
The class action lawsuit seeks reimbursement of the membership fees and punitive damages for members of Clear.
Click on title above for free evaluation of your possible case;
https://www.lawyersandsettlements.com/submit_form.html?label=clear-class-action-verified-identity-pass-vipclass
Clear operated the Registered Traveler program in 20 airports, serving a reported 260,000 customers. The company pre-screened frequent fliers taking fingerprints, iris sans and credit information on customers which it then gave to the US Transportation Security Administration, in order to fast track people through the security line-ups.
The class action lawsuit seeks reimbursement of the membership fees and punitive damages for members of Clear.
Click on title above for free evaluation of your possible case;
https://www.lawyersandsettlements.com/submit_form.html?label=clear-class-action-verified-identity-pass-vipclass
Marriott Sued by Hourly Employees over Unpaid Meal and Rest Breaks
A class action lawsuit brought by hourly wage employees against 2 Marriott hotels is awaiting court approval of a settlement, and potential class members have until Monday, July 6, 2009 to file a claim.
The suit alleged that the Marriott hotels did not pay employees for missed meal periods or rest breaks. Under California law, all hourly employees are entitled to a 30-minute meal break for each shift lasting more than 5 hours. The 30-minute meal break must be uninterrupted and provided during the first 5 hours of the employee's shift. California hourly employees are also entitled to a 10-minute rest period for every 4 hours worked.
A preliminary settlement of $625,000 was reached in June. Pending final court approval of the settlement, proceeds will be distributed to class members based upon the number of hours they worked during the class period in relation to the total number of hours worked by all class members during the same period, which is from March 1, 2004 to April 6, 2009.
Click on title above for free evaluation of your possible case;
https://www.lawyersandsettlements.com/submit_form.html?label=marriott-desert-springs-class-action-renaissance
The suit alleged that the Marriott hotels did not pay employees for missed meal periods or rest breaks. Under California law, all hourly employees are entitled to a 30-minute meal break for each shift lasting more than 5 hours. The 30-minute meal break must be uninterrupted and provided during the first 5 hours of the employee's shift. California hourly employees are also entitled to a 10-minute rest period for every 4 hours worked.
A preliminary settlement of $625,000 was reached in June. Pending final court approval of the settlement, proceeds will be distributed to class members based upon the number of hours they worked during the class period in relation to the total number of hours worked by all class members during the same period, which is from March 1, 2004 to April 6, 2009.
Click on title above for free evaluation of your possible case;
https://www.lawyersandsettlements.com/submit_form.html?label=marriott-desert-springs-class-action-renaissance
FOR SALE: 08' Market Report: Big-Pharma, Infectious Disease & Vaccines, ONLY $15,200!!
From "FierceVaccines," a weekly update on the vaccine industry.
Editor-in-Chief: John Carroll. Editor: Maureen Martino. Associate Editor: Calisha Myers. Publisher: Arsalan Arif.
New to FierceVaccines? Sign up for free at www.fiercevaccines.com
------------------------------------------------------------------
Report Index
Infectious Diseases Vaccine Market Overview: Key Companies and Strategies
Quantity in Basket: none
Price: $15,200.00
Report Format: PDF
Date Published: 18-Dec-08
Product Type: Premium Report
Table of Contents: View Table of Contents
Introduction
Long being regarded as an unattractive market, vaccines have re-emerged as successful growth driver for Big Pharma. The launch and rapid uptake of novel, high-price products such as Wyeth's Prevnar or Merck & Co's Gardasil, along with the emergence of novel vaccine technologies and favourable legislation have brought vaccines back into the main focus of pharmaceutical and biotech companies.
Scope
Market overview with current market assessment in terms of leading players, brands and geographies
In-depth analyses of the leading 5 players' portfolios, R&D pipelines, sales trends, geographic spread, licensing patterns and strategic outlook
Discussion of key developments shaping the sector: new technologies, indications and geographies
Snapshot profiles of second tier companies in the sector: strength in specialties
Report Highlights
With the exception of influenza, only two to three vaccine manufacturers compete for each disease. This lack of competition combined with public health requirements to guarantee a stable supply of vaccines has resulted in a recent upward shift of vaccine prices for specialty vaccines.
The most significant threat to the oligopoly of the Big 5 in the vaccines market comes from companies from emerging markets, which have large manufacturing capacities for biologics and are able to produce even complex substances like vaccines at low costs.
While vaccine sales have grown at a CAGR of 32% between 2004 and 2007 and shown an annual growth rate of 46% between 2006 and 2007, overall pharmaceutical sales have grown much more slowly, with both the 2004-2007 CAGR as well as the growth rate between 2006 and 2007 only reaching 8%.
Reasons to Purchase
Get a comprehensive, insightful commercial overview of the vaccines market
Learn about the strategies of the Big 5 players, their strengths, weaknesses, similarities and differences
Gain insight into the future directions and growing strategic importance of vaccines for Big Pharma
Table of Contents
Infectious Diseases Vaccine Market Overview: Key Companies & Strategies - In times of crisis, Big Pharma turns to vaccines - Market overview for the vaccines sector. Profiles of the 5 major vaccine companies, analyzing strategic directions in terms R&D and licensing, portfolio and pipeline breadth and depth as well as other individual strengths & weaknesses
Product Code: dmhc2457
Publication Date: 18-Dec-2008
--------------------------------------------------------------------------------
Overview
Introduction
Long being regarded as an unattractive market, vaccines have re-emerged as successful growth driver for Big Pharma. The launch and rapid uptake of novel, high-price products such as Wyeth's Prevnar or Merck & Co's Gardasil, along with the emergence of novel vaccine technologies and favourable legislation have brought vaccines back into the main focus of pharmaceutical and biotech companies.
Scope
· Market overview with current market assessment in terms of leading players, brands and geographies
· In-depth analyses of the leading 5 players' portfolios, R&D pipelines, sales trends, geographic spread, licensing patterns and strategic outlook
· Discussion of key developments shaping the sector: new technologies, indications and geographies
· Snapshot profiles of second tier companies in the sector: strength in specialties
Highlights
With the exception of influenza, only two to three vaccine manufacturers compete for each disease. This lack of competition combined with public health requirements to guarantee a stable supply of vaccines has resulted in a recent upward shift of vaccine prices for specialty vaccines.
The most significant threat to the oligopoly of the Big 5 in the vaccines market comes from companies from emerging markets, which have large manufacturing capacities for biologics and are able to produce even complex substances like vaccines at low costs.
While vaccine sales have grown at a CAGR of 32% between 2004 and 2007 and shown an annual growth rate of 46% between 2006 and 2007, overall pharmaceutical sales have grown much more slowly, with both the 2004-2007 CAGR as well as the growth rate between 2006 and 2007 only reaching 8%.
Reasons to Purchase
· Get a comprehensive, insightful commercial overview of the vaccines market
· Learn about the strategies of the Big 5 players, their strengths, weaknesses, similarities and differences
· Gain insight into the future directions and growing strategic importance of vaccines for Big Pharma
--------------------------------------------------------------------------------
ABOUT DATAMONITOR HEALTHCARE
2
About the Infectious diseases pharmaceutical analysis team
2
CHAPTER 1 EXECUTIVE SUMMARY
3
Strategic scoping and focus
3
Datamonitor insight into the disease market
3
Related reports
8
CHAPTER 2 MARKET DEFINITION
10
Market definition for this report
10
CHAPTER 3 MARKET OVERVIEW
12
Summary
12
Vaccines have emerged as key revenue drivers for Big Pharma
13
The emergence of new technologies has increased the possibilities for vaccine development
13
The success stories of Prevnar and Gardasil fuel hopes for further vaccine blockbusters
15
New legislation in the US has decreased the risks of litigation for vaccine manufacturers
18
The high entry hurdles for generics manufacturers make vaccines an attractive sector in times of the decline of the traditional blockbuster model
20
Upholding the strong growth of the vaccine sector as a whole will be the key challenge in the coming decade
23
Current market assessment
24
Five big companies dominate the vaccines market
24
The global vaccine market is growing very fast and the importance of vaccines for pharmaceutical portfolios is increasing
25
Over the last four years, approvals of novel vaccines as well as consolidation have shaped the global vaccine market
28
The US remain the main market for vaccines in 2007
29
Wyeth's Prevnar and Merck & Co's Gardasil have both reached blockbuster status
30
Snapshot of other important vaccines players
31
AstraZeneca: holding on to MedImmune's heritage?
33
Bavarian Nordic: niche player in biodefense
33
Baxter - strong manufacturing capacity as key opportunity
33
CSL: controlling the Australian vaccines market
34
Crucell: attractive dual business model
35
Emergent BioSolutions: focusing on biodefense
35
Intercell: the multi-partner company
36
Pfizer: building on DNA vaccines and adjuvants
37
Solvay: influenza as key focus
37
Opportunities and threats
38
Opportunities
39
Development of vaccines for novel indications
39
Development of new technologies
41
Expansion to emerging and developing markets
41
Increasing awareness and "disease marketing"
43
Threats
44
Cost containment
44
Regulatory requirement for increasingly large trials increases upfront investments and development times
45
Low-cost manufacturers from emerging markets could shake up the sector and undercut prices
46
Negative publicity and public scares through anti-vaccination activists
48
CHAPTER 4 MERCK & CO - THE INNOVATOR
51
Summary
51
Strategic overview
52
History of vaccines division
52
Sales performance
55
Geographic spread
56
Seasonality
57
Role of vaccines in overall company portfolio
58
Portfolio analysis
60
Gardasil
61
RotaTeq
64
Zostavax
66
Hepatitis franchise
68
Other viral vaccines
70
Other vaccines
71
Pipeline analysis
73
Heplisav
76
V710
78
V503
79
V419
79
V950
80
Deals and alliances
80
Product deals
81
In-licensing of Heplisav from Dynavax Technologies
83
Collaboration with Intercell regarding staphylococcal vaccines
83
In-licensing of Gardasil from CSL
84
Development collaborations with PATH and the Indian Council of Medical Research
84
M&A, distribution and marketing agreements
85
Technology deals
85
In-licensing of Idera's TLR7, 8, 9 adjuvant candidates for use in vaccines against oncology, infectious diseases and Alzheimer's disease
86
Research collaboration with Iomai regarding Iomai's transdermal patch delivery technology
87
Grants and government contracts
87
Strategic outlook
88
Strengths: Merck & Co's strong portfolio of novel, high-price vaccines will continue to provide large vaccine revenues
89
Weaknesses: late-stage failures have thinned Merck & Co's vaccine pipeline
89
Opportunities: further geographic expansion of Merck & Co's novel vaccines portfolio could result in substantial revenue increases
91
Threats: competition for RotaTeq and Gardasil is emerging
92
CHAPTER 5 SANOFI PASTEUR - THE CUSTOMIZER
93
Summary
93
Strategic overview
94
History of vaccines division
94
Sales performance
98
Seasonality
99
Role of vaccines in overall company portfolio
99
Portfolio analysis
101
Influenza vaccine franchise
102
Pediatric combination franchise
105
Adult/adolescent booster franchise
109
Meningitis/pneumonia franchise
111
Travel, endemic, MMR vaccine franchise
114
Other vaccines
116
Pipeline analysis
118
Influenza
123
Pediatric and adolescent combination vaccines
124
Meningitis/pneumonia
125
Travelers and endemic vaccines
126
Other vaccines
128
Deals and alliances
130
Product deals
130
Licensing agreement with Crucell regarding cell-based influenza vaccines and related technical services agreement with Lonza
133
Manufacturing and supply agreement with M.P. Chumakov Institute of Poliomyelitis and Virus Encephalitides regarding polio vaccine for Russia
133
Research and license agreement with Statens Serum Institut regarding tuberculosis vaccine candidate
133
M&A, distribution and marketing agreements
134
Acquisition of Acambis
135
Joint venture with Daiichi Sankyo for the Japanese market
136
Technology deals
136
Licensing of Becton-Dickinson's micro-delivery technology
139
Grants and government contracts
139
Strategic outlook
141
Strengths: ongoing leadership in important flu and pediatric combination sectors
142
Weaknesses: focus on follow-on has resulted in lack of innovation
143
Opportunities: hidden pipeline gems with blockbuster potential
144
Threats: Menactra's monopoly expected to fall
144
CHAPTER 6 GLAXOSMITHKLINE - THE ALL-ROUNDER
146
Summary
146
Strategic overview
147
History of vaccine division
147
Sales performance
150
Geographic spread
151
Seasonality
152
Role of vaccines in overall company portfolio
153
Portfolio analysis
155
Infanrix franchise
156
Hepatitis franchise
159
Influenza franchise
160
Cervarix
163
Rotarix
165
Other vaccines
166
Pipeline analysis
167
Meningitis
170
Pneumococcal disease
171
Influenza
171
Travel vaccines and tuberculosis
172
Cancer
172
Deals and alliances
173
Product deals
173
In-licensing of two Alzheimer vaccine candidates from Affiris
175
In-licensing of MAGE-A3 and other tumor antigens from the Ludwig Institute of Cancer Research
175
In-licensing of meningitis antigens and IP from Imclone
175
In-licensing of Rotarix from AVANT Immunotherapeutics
176
Strategic alliance with MedImmune for the development of Cervarix
176
M&A, public-private partnerships, distribution and marketing agreements
176
Acquisition of ID Biomedical
179
Acquisition of Corixa Corporation
180
Promotion Service Agreement with Sinovac Biotech and establishment of an exclusive cooperation agreement with Shenzhen Neptunus Interlong Bio-Technique Co. Ltd. (NIBT)
180
Technology deals
181
Licensing of MedImmune's reverse genetics technology for influenza
183
Grants and government contracts
183
Strategic outlook
184
Strengths: commercializing on a continuing strong portfolio
186
Weaknesses: suboptimal US penetration constitutes major revenue limitation
186
Opportunities: strong pipeline to drive future revenues
187
Threats: FDA's attitude towards novel adjuvants unlikely to change soon
188
CHAPTER 7 WYETH - THE ONE HIT WONDER
190
Summary
190
Strategic overview
191
History of vaccines division
191
Sales performance
193
Geographic spread
194
Seasonality
195
Role of vaccines in overall company portfolio
196
Portfolio analysis
198
Prevnar
199
Pipeline analysis
201
Prevnar 13
203
ACC-001
204
MnB rLP2086
204
Deals and alliances
205
Product deals
205
License agreement with RIVM for meningitis B vaccine
206
Alliance with Elan for development of new drugs to treat Alzheimer's disease
206
M&A, public-private partnerships
207
Equity Investment in Alphavax
208
Technology deals
208
In-licensing of Inhibitex's MSCRAMM (Microbial Surface Components Recognizing Adhesive Matrix Molecules) protein technology
210
Inlicensing of Inovio's DNA delivery technology
210
Grants and government contracts
210
Strategic outlook
211
Strengths: Wyeth will continue to dominate the pneumococcal vaccine market
212
Weaknesses: strong reliance on Prevnar franchise as sole revenue generator
213
Opportunities: strong focus on new geographies and target groups
214
Threats: emerging competitors in key revenue sectors
214
CHAPTER 8 NOVARTIS - THE NEWCOMER
216
Summary
216
Strategic overview
217
History of vaccines division
217
Sales performance
220
Geographic spread
221
Seasonality
222
Role of vaccines in overall company portfolio
223
Portfolio analysis
224
Influenza vaccine franchise
225
Travel vaccine franchise
227
Meningitis vaccines
228
Pediatric/adult DTP/polio/Hib vaccines
229
Pipeline analysis
230
Meningitis
234
Influenza
235
Novel therapeutic vaccines
236
CAD106 (Alzheimer's disease, Phase II)
236
Nic002 (nicotine dependence, Phase II)
236
Others
237
Deals and alliances
238
Product deals
238
Strategic partnership with Intercell
241
Marketing and distribution agreement for Intercell's Ixiaro
241
In-licensing of CAD106 and Nic002 from Cytos Biotechnology
242
M&A, distribution and marketing agreements
242
Acquisition of Chiron
244
Acquisition of PowderJect and Spin-off of PowderMed by Chiron
245
Divestment of SBL Vaccin AB
246
Technology deals
246
Grants and government contracts
247
Strategic outlook
249
Strengths: Novartis has a strong influenza portfolio and excellent science
250
Weaknesses: two years after the acquisition of Chiron, Novartis's vaccine division is still fragmented
251
Opportunities: Menveo and Men B as potential blockbusters
251
Threats: competition in the meningitis space is fierce
252
BIBLIOGRAPHY
253
Company financial reports
253
Merck & Co
253
Sanofi Pasteur
253
GlaxoSmithKline
253
Wyeth
254
Novartis
254
Further literature
254
APPENDIX
263
Contributing experts
263
Report methodology
263
About Datamonitor
264
About Datamonitor Healthcare
264
About the Infectious Diseases analysis team
265
Key therapy team members
266
Holger Rovini, Head of Respiratory and Infectious Diseases
266
Hedwig Kresse, Senior Analyst, Infectious Diseases
266
Disclaimer
268
List of Tables
Table 1: Vaccine sales and growth rates of the top five vaccine manufacturers, 2004-9M2008
26
Table 2: Sales breakdown of the four best-selling vaccines, 2004-9M 2008
31
Table 3: Recent key mergers and acquisitions in the vaccines industry, December 2008
32
Table 4: Summary of opportunities and threats in the vaccines market, 2008
39
Table 5: Merck & Co - vaccine portfolio overview, December 2008
61
Table 6: Merck & Co - Gardasil product overview
62
Table 7: Merck & Co - RotaTeq product overview
64
Table 8: Merck & Co - Zostavax product overview
66
Table 9: Merck & Co - hepatitis franchise product overview
68
Table 10: Merck & Co - other viral vaccines product overview
70
Table 11: Merck & Co - other vaccines product overview
72
Table 12: Merck & Co - vaccine pipeline overview, December 2008
74
Table 13: Merck & Co - key vaccine product deals, December 2008
82
Table 14: Merck & Co - Vaccine joint venture with Sanofi Pasteur
85
Table 15: Merck & Co - key vaccine technology deals, December 2008
86
Table 16: Merck & Co vaccines - SWOT analysis, December 2008
88
Table 17: Sanofi Pasteur - vaccine portfolio overview, December 2008
102
Table 18: Sanofi Pasteur - influenza vaccine franchise product overview
103
Table 19: Sanofi Pasteur - pediatric combination vaccine franchise key product overview
107
Table 20: Sanofi Pasteur - booster vaccine franchise product overview
110
Table 21: Sanofi Pasteur - meningitis/pneumonia vaccine franchise product overview
112
Table 22: Sanofi Pasteur - traveler/endemic vaccine franchise product overview
115
Table 23: Sanofi Pasteur - vaccine pipeline overview, December 2008
119
Table 24: Sanofi Pasteur - Key vaccine product deals (1); December 2008
131
Table 25: Sanofi Pasteur - Key vaccine product deals (2); December 2008
132
Table 26: Sanofi Pasteur - key vaccine M&A, public-private partnerships, distribution/marketing agreements, December 2008
135
Table 27: Sanofi Pasteur - key vaccine technology deals, December 2008
138
Table 28: Sanofi Pasteur - key grants and government contracts for vaccines, December 2008
140
Table 29: Sanofi Pasteur - SWOT analysis, December 2008
142
Table 30: GlaxoSmithKline - vaccine portfolio overview, December 2008
156
Table 31: GlaxoSmithKline - Infanrix franchise product overview
157
Table 32: GlaxoSmithKline - DTP adolescent booster product overview
157
Table 33: GlaxoSmithKline - hepatitis franchise product overview
159
Table 34: GlaxoSmithKline - influenza vaccine franchise product overview
162
Table 35: GlaxoSmithKline - other vaccines, overview
167
Table 36: GlaxoSmithKline - vaccine pipeline overview, December 2008
168
Table 37: GlaxoSmithKline - key vaccine product deals; December 2008
174
Table 38: GlaxoSmithKline - key vaccine M&A, public-private partnerships, distribution/marketing agreements, December 2008
178
Table 39: GlaxoSmithKline - key vaccine technology deals, December 2008
182
Table 40: GlaxoSmithKline - key grants and government contracts for vaccines, December 2008
184
Table 41: GlaxoSmithKline vaccines - SWOT analysis, December 2008
185
Table 42: Wyeth - vaccines pipeline, December 2008
202
Table 43: Wyeth - key vaccine product deals, December 2008
206
Table 44: Wyeth - key vaccine M&A, public-private partnerships, distribution/marketing agreements, December 2008
208
Table 45: Wyeth - key vaccine technology deals, December 2008
209
Table 46: Wyeth - key grants and government contracts for vaccines, December 2008
211
Table 47: Wyeth vaccines - SWOT analysis, December 2008
212
Table 48: Novartis - vaccine portfolio overview; December 2008
225
Table 49: Novartis - Influenza vaccine franchise product overview
226
Table 50: Novartis - travel vaccine franchise key product overview
227
Table 51: Novartis - meningococcal vaccine franchise product overview
228
Table 52: Novartis - clinical vaccine pipeline overview, December 2008
231
Table 53: Novartis - key vaccine product deals, December 2008
240
Table 54: Novartis - key vaccine M&A, public-private partnerships, distribution/marketing agreements, December 2008
244
Table 55: Novartis - key vaccine technology deals, December 2008
247
Table 56: Novartis - key grants and government contracts for vaccines, December 2008
248
Table 57: Novartis - SWOT analysis, December 2008
249
List of Figures
Figure 1: Comparison of IMS-reported versus company-reported global sales data for vaccines, 2007
10
Figure 2: Prevnar: global sales 2001-9M2008
16
Figure 3: Gardasil: sales 2004-9M2008
17
Figure 4: National Vaccine Injury Compensation Program - petition and award statistics, 1990-2008
20
Figure 5: Comparison of lifecycles of pharmaceuticals and vaccines
22
Figure 6: Market growth cycle for vaccines
23
Figure 7: Market shares of the five key vaccine players in total vaccine sales, 2004 versus 2007
24
Figure 8: Combined vaccine sales of the top five vaccine manufacturers, 2004-9M2008
25
Figure 9: Vaccines versus overall pharmaceutical sales, 2007
27
Figure 10: Vaccine sales as share of overall company pharmaceutical sales, 2004-9M2008
28
Figure 11: Key events impacting the vaccines market, 2004-08
29
Figure 12: 2007 vaccine sales of Merck & Co, GlaxoSmithKline, Wyeth, Novartis and Sanofi Pasteur MSD by geography
30
Figure 13: Share of leading vaccines on a product basis, 2004-2007
31
Figure 14: Birth cohort sizes - seven major markets versus BRIC countries
42
Figure 15: Possible strategies for penetration of emerging markets
43
Figure 16: Public sector costs of routine childhood immunization per child, US, 1975-2008
44
Figure 17: Number of enrolled patients in Phase III trials for selected vaccines
46
Figure 18: Presence of local/regional vaccine manufacturers in emerging geographies
47
Figure 19: Reported measles cases and MMR vaccination coverage in England, 1996--2007
49
Figure 20: Merck & Co - vaccines pedigree, 2008
54
Figure 21: Merck & Co - total vaccine sales, 2004-2008; Q1-Q3
56
Figure 22: Merck & Co vaccine sales - geographic spread, 2004-9M2008
57
Figure 23: Merck & Co - total vaccine sales, by quarter, 2006-9M2008
58
Figure 24: Merck & Co - vaccine sales as share of overall company pharmaceutical sales, 2004-9M2008
59
Figure 25: Merck & Co - vaccines versus overall pharmaceutical sales, 2007
60
Figure 26: Merck & Co - Gardasil sales by geography, 2004-9M2008
62
Figure 27: Merck & Co - RotaTeq sales by geography, 2004-9M2008
65
Figure 28: Merck & Co - Zostavax sales by geography, 2004-9M2008
67
Figure 29: Merck & Co - hepatitis franchise sales by geography, 2004-9M2008
69
Figure 30: Merck & Co - other viral vaccines sales by geography, 2004-9M2008
71
Figure 31: Merck & Co - other vaccines sales by geography, 2004-9M2008
73
Figure 32: Merck & Co - overlap between marketed vaccines portfolio and pipeline vaccines, December 2008
75
Figure 33: Merck & Co - clinical vaccines pipeline depth, December 2008
76
Figure 34: Sanofi Pasteur - history of vaccines division
96
Figure 35: Sanofi Pasteur - vaccines pedigree, 2008
97
Figure 36: Sanofi Pasteur - total vaccine sales, 2004-9M 2008
98
Figure 37: Sanofi Pasteur - total vaccine sales, by quarter, 2006-9M2008
99
Figure 38: Sanofi Aventis - vaccine sales as share of overall company pharmaceutical sales, 2004-9M2008
100
Figure 39: Sanofi Aventis - vaccines versus overall pharmaceutical sales, 2007
101
Figure 40: Sanofi Pasteur - influenza vaccine franchise sales, 2004-9M2008
104
Figure 41: Sanofi Pasteur - pediatric combination vaccine franchise sales, 2004-9M2008
108
Figure 42: Sanofi Pasteur - booster vaccine franchise sales, 2004-9M2008
110
Figure 43: Sanofi Pasteur - meningitis/pneumonia vaccine franchise sales, 2004-9M2008
113
Figure 44: Sanofi Pasteur - traveler/endemic vaccine franchise sales, 2004-9M2008
116
Figure 45: Sanofi Pasteur - other vaccine sales, 2004-9M2008
117
Figure 46: Sanofi Pasteur - share of Sanofi Pasteur MSD joint venture sales by vaccine class, 2004-9M2008
118
Figure 47: Sanofi Pasteur - clinical vaccines pipeline depth and breadth, December 2008
121
Figure 48: Sanofi Pasteur - overlap between marketed vaccines portfolio and pipeline vaccines, December 2008
122
Figure 49: GlaxoSmithKline - history of vaccines division
148
Figure 50: GlaxoSmithKline - vaccines pedigree, 2008
149
Figure 51: GlaxoSmithKline - total vaccine sales, 2004-9M2008
151
Figure 52: GlaxoSmithKline vaccine sales - geographic spread, 2004-9M2008
152
Figure 53: GlaxoSmithKline - total vaccine sales, by quarter, 2006-9M2008
153
Figure 54: GlaxoSmithKline - vaccine sales as share of overall company pharmaceutical sales, 2004-9M2008
154
Figure 55: GlaxoSmithKline - vaccines versus overall pharmaceutical sales, 2007
155
Figure 56: GlaxoSmithKline - Infanrix and Boostrix franchise sales by geography, 2004-9M2008
158
Figure 57: GlaxoSmithKline - hepatitis vaccine franchise sales by geography, 2004-9M2008
160
Figure 58: GlaxoSmithKline - influenza vaccine franchise sales by geography, 2004-9M2008
163
Figure 59: GlaxoSmithKline - Cervarix sales by geography, 2004-9M2008
164
Figure 60: GlaxoSmithKline - Rotarix sales by geography, 2004-9M2008
166
Figure 61: GlaxoSmithKline - overlap between marketed vaccines portfolio and pipeline vaccines, December 2008
169
Figure 62: GlaxoSmithKline - clinical vaccines pipeline depth and breadth, December 2008
170
Figure 63: GlaxoSmithKline vaccines pipeline - adjuvanted versus non-adjuvanted candidates, December 2008
188
Figure 64: Wyeth - vaccines pedigree, 2008
192
Figure 65: Wyeth - total vaccine sales (Prevnar), 2004-9M2008
193
Figure 66: Wyeth vaccine sales (Prevnar) - geographic spread, 2004-9M2008
195
Figure 67: Wyeth - total vaccine sales (Prevnar), by quarter, 2006-9M2008
196
Figure 68: Wyeth - vaccine sales (Prevnar) as share of overall company pharmaceutical sales, 2004-9M2008
197
Figure 69: Wyeth - vaccines (Prevnar) versus overall pharmaceutical sales, 2007
198
Figure 70: Wyeth - Prevnar sales by geography, 2004-9M2008
200
Figure 71: Wyeth - overlap between marketed vaccines portfolio and pipeline vaccines, December 2008
202
Figure 72: Novartis - history of vaccines division
218
Figure 73: Novartis - vaccines pedigree, 2008
219
Figure 74: Novartis- total vaccine sales, 2004-9M2008
221
Figure 75: Novartis vaccines and diagnostics sales - geographic spread, 2004-9M2008
222
Figure 76: Novartis - total vaccine and diagnostics sales, by quarter, 2006-9M2008
223
Figure 77: Novartis - vaccines and diagnostics sales as share of overall company pharmaceutical sales (excluding consumer health), 2004-9M2008
224
Figure 78: Novartis - overlap between marketed vaccines portfolio and pipeline vaccines
232
Figure 79: Novartis - clinical vaccines pipeline depth and breadth, December 2008
233
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Report Index
Infectious Diseases Vaccine Market Overview: Key Companies and Strategies
Quantity in Basket: none
Price: $15,200.00
Report Format: PDF
Date Published: 18-Dec-08
Product Type: Premium Report
Table of Contents: View Table of Contents
Introduction
Long being regarded as an unattractive market, vaccines have re-emerged as successful growth driver for Big Pharma. The launch and rapid uptake of novel, high-price products such as Wyeth's Prevnar or Merck & Co's Gardasil, along with the emergence of novel vaccine technologies and favourable legislation have brought vaccines back into the main focus of pharmaceutical and biotech companies.
Scope
Market overview with current market assessment in terms of leading players, brands and geographies
In-depth analyses of the leading 5 players' portfolios, R&D pipelines, sales trends, geographic spread, licensing patterns and strategic outlook
Discussion of key developments shaping the sector: new technologies, indications and geographies
Snapshot profiles of second tier companies in the sector: strength in specialties
Report Highlights
With the exception of influenza, only two to three vaccine manufacturers compete for each disease. This lack of competition combined with public health requirements to guarantee a stable supply of vaccines has resulted in a recent upward shift of vaccine prices for specialty vaccines.
The most significant threat to the oligopoly of the Big 5 in the vaccines market comes from companies from emerging markets, which have large manufacturing capacities for biologics and are able to produce even complex substances like vaccines at low costs.
While vaccine sales have grown at a CAGR of 32% between 2004 and 2007 and shown an annual growth rate of 46% between 2006 and 2007, overall pharmaceutical sales have grown much more slowly, with both the 2004-2007 CAGR as well as the growth rate between 2006 and 2007 only reaching 8%.
Reasons to Purchase
Get a comprehensive, insightful commercial overview of the vaccines market
Learn about the strategies of the Big 5 players, their strengths, weaknesses, similarities and differences
Gain insight into the future directions and growing strategic importance of vaccines for Big Pharma
Table of Contents
Infectious Diseases Vaccine Market Overview: Key Companies & Strategies - In times of crisis, Big Pharma turns to vaccines - Market overview for the vaccines sector. Profiles of the 5 major vaccine companies, analyzing strategic directions in terms R&D and licensing, portfolio and pipeline breadth and depth as well as other individual strengths & weaknesses
Product Code: dmhc2457
Publication Date: 18-Dec-2008
--------------------------------------------------------------------------------
Overview
Introduction
Long being regarded as an unattractive market, vaccines have re-emerged as successful growth driver for Big Pharma. The launch and rapid uptake of novel, high-price products such as Wyeth's Prevnar or Merck & Co's Gardasil, along with the emergence of novel vaccine technologies and favourable legislation have brought vaccines back into the main focus of pharmaceutical and biotech companies.
Scope
· Market overview with current market assessment in terms of leading players, brands and geographies
· In-depth analyses of the leading 5 players' portfolios, R&D pipelines, sales trends, geographic spread, licensing patterns and strategic outlook
· Discussion of key developments shaping the sector: new technologies, indications and geographies
· Snapshot profiles of second tier companies in the sector: strength in specialties
Highlights
With the exception of influenza, only two to three vaccine manufacturers compete for each disease. This lack of competition combined with public health requirements to guarantee a stable supply of vaccines has resulted in a recent upward shift of vaccine prices for specialty vaccines.
The most significant threat to the oligopoly of the Big 5 in the vaccines market comes from companies from emerging markets, which have large manufacturing capacities for biologics and are able to produce even complex substances like vaccines at low costs.
While vaccine sales have grown at a CAGR of 32% between 2004 and 2007 and shown an annual growth rate of 46% between 2006 and 2007, overall pharmaceutical sales have grown much more slowly, with both the 2004-2007 CAGR as well as the growth rate between 2006 and 2007 only reaching 8%.
Reasons to Purchase
· Get a comprehensive, insightful commercial overview of the vaccines market
· Learn about the strategies of the Big 5 players, their strengths, weaknesses, similarities and differences
· Gain insight into the future directions and growing strategic importance of vaccines for Big Pharma
--------------------------------------------------------------------------------
ABOUT DATAMONITOR HEALTHCARE
2
About the Infectious diseases pharmaceutical analysis team
2
CHAPTER 1 EXECUTIVE SUMMARY
3
Strategic scoping and focus
3
Datamonitor insight into the disease market
3
Related reports
8
CHAPTER 2 MARKET DEFINITION
10
Market definition for this report
10
CHAPTER 3 MARKET OVERVIEW
12
Summary
12
Vaccines have emerged as key revenue drivers for Big Pharma
13
The emergence of new technologies has increased the possibilities for vaccine development
13
The success stories of Prevnar and Gardasil fuel hopes for further vaccine blockbusters
15
New legislation in the US has decreased the risks of litigation for vaccine manufacturers
18
The high entry hurdles for generics manufacturers make vaccines an attractive sector in times of the decline of the traditional blockbuster model
20
Upholding the strong growth of the vaccine sector as a whole will be the key challenge in the coming decade
23
Current market assessment
24
Five big companies dominate the vaccines market
24
The global vaccine market is growing very fast and the importance of vaccines for pharmaceutical portfolios is increasing
25
Over the last four years, approvals of novel vaccines as well as consolidation have shaped the global vaccine market
28
The US remain the main market for vaccines in 2007
29
Wyeth's Prevnar and Merck & Co's Gardasil have both reached blockbuster status
30
Snapshot of other important vaccines players
31
AstraZeneca: holding on to MedImmune's heritage?
33
Bavarian Nordic: niche player in biodefense
33
Baxter - strong manufacturing capacity as key opportunity
33
CSL: controlling the Australian vaccines market
34
Crucell: attractive dual business model
35
Emergent BioSolutions: focusing on biodefense
35
Intercell: the multi-partner company
36
Pfizer: building on DNA vaccines and adjuvants
37
Solvay: influenza as key focus
37
Opportunities and threats
38
Opportunities
39
Development of vaccines for novel indications
39
Development of new technologies
41
Expansion to emerging and developing markets
41
Increasing awareness and "disease marketing"
43
Threats
44
Cost containment
44
Regulatory requirement for increasingly large trials increases upfront investments and development times
45
Low-cost manufacturers from emerging markets could shake up the sector and undercut prices
46
Negative publicity and public scares through anti-vaccination activists
48
CHAPTER 4 MERCK & CO - THE INNOVATOR
51
Summary
51
Strategic overview
52
History of vaccines division
52
Sales performance
55
Geographic spread
56
Seasonality
57
Role of vaccines in overall company portfolio
58
Portfolio analysis
60
Gardasil
61
RotaTeq
64
Zostavax
66
Hepatitis franchise
68
Other viral vaccines
70
Other vaccines
71
Pipeline analysis
73
Heplisav
76
V710
78
V503
79
V419
79
V950
80
Deals and alliances
80
Product deals
81
In-licensing of Heplisav from Dynavax Technologies
83
Collaboration with Intercell regarding staphylococcal vaccines
83
In-licensing of Gardasil from CSL
84
Development collaborations with PATH and the Indian Council of Medical Research
84
M&A, distribution and marketing agreements
85
Technology deals
85
In-licensing of Idera's TLR7, 8, 9 adjuvant candidates for use in vaccines against oncology, infectious diseases and Alzheimer's disease
86
Research collaboration with Iomai regarding Iomai's transdermal patch delivery technology
87
Grants and government contracts
87
Strategic outlook
88
Strengths: Merck & Co's strong portfolio of novel, high-price vaccines will continue to provide large vaccine revenues
89
Weaknesses: late-stage failures have thinned Merck & Co's vaccine pipeline
89
Opportunities: further geographic expansion of Merck & Co's novel vaccines portfolio could result in substantial revenue increases
91
Threats: competition for RotaTeq and Gardasil is emerging
92
CHAPTER 5 SANOFI PASTEUR - THE CUSTOMIZER
93
Summary
93
Strategic overview
94
History of vaccines division
94
Sales performance
98
Seasonality
99
Role of vaccines in overall company portfolio
99
Portfolio analysis
101
Influenza vaccine franchise
102
Pediatric combination franchise
105
Adult/adolescent booster franchise
109
Meningitis/pneumonia franchise
111
Travel, endemic, MMR vaccine franchise
114
Other vaccines
116
Pipeline analysis
118
Influenza
123
Pediatric and adolescent combination vaccines
124
Meningitis/pneumonia
125
Travelers and endemic vaccines
126
Other vaccines
128
Deals and alliances
130
Product deals
130
Licensing agreement with Crucell regarding cell-based influenza vaccines and related technical services agreement with Lonza
133
Manufacturing and supply agreement with M.P. Chumakov Institute of Poliomyelitis and Virus Encephalitides regarding polio vaccine for Russia
133
Research and license agreement with Statens Serum Institut regarding tuberculosis vaccine candidate
133
M&A, distribution and marketing agreements
134
Acquisition of Acambis
135
Joint venture with Daiichi Sankyo for the Japanese market
136
Technology deals
136
Licensing of Becton-Dickinson's micro-delivery technology
139
Grants and government contracts
139
Strategic outlook
141
Strengths: ongoing leadership in important flu and pediatric combination sectors
142
Weaknesses: focus on follow-on has resulted in lack of innovation
143
Opportunities: hidden pipeline gems with blockbuster potential
144
Threats: Menactra's monopoly expected to fall
144
CHAPTER 6 GLAXOSMITHKLINE - THE ALL-ROUNDER
146
Summary
146
Strategic overview
147
History of vaccine division
147
Sales performance
150
Geographic spread
151
Seasonality
152
Role of vaccines in overall company portfolio
153
Portfolio analysis
155
Infanrix franchise
156
Hepatitis franchise
159
Influenza franchise
160
Cervarix
163
Rotarix
165
Other vaccines
166
Pipeline analysis
167
Meningitis
170
Pneumococcal disease
171
Influenza
171
Travel vaccines and tuberculosis
172
Cancer
172
Deals and alliances
173
Product deals
173
In-licensing of two Alzheimer vaccine candidates from Affiris
175
In-licensing of MAGE-A3 and other tumor antigens from the Ludwig Institute of Cancer Research
175
In-licensing of meningitis antigens and IP from Imclone
175
In-licensing of Rotarix from AVANT Immunotherapeutics
176
Strategic alliance with MedImmune for the development of Cervarix
176
M&A, public-private partnerships, distribution and marketing agreements
176
Acquisition of ID Biomedical
179
Acquisition of Corixa Corporation
180
Promotion Service Agreement with Sinovac Biotech and establishment of an exclusive cooperation agreement with Shenzhen Neptunus Interlong Bio-Technique Co. Ltd. (NIBT)
180
Technology deals
181
Licensing of MedImmune's reverse genetics technology for influenza
183
Grants and government contracts
183
Strategic outlook
184
Strengths: commercializing on a continuing strong portfolio
186
Weaknesses: suboptimal US penetration constitutes major revenue limitation
186
Opportunities: strong pipeline to drive future revenues
187
Threats: FDA's attitude towards novel adjuvants unlikely to change soon
188
CHAPTER 7 WYETH - THE ONE HIT WONDER
190
Summary
190
Strategic overview
191
History of vaccines division
191
Sales performance
193
Geographic spread
194
Seasonality
195
Role of vaccines in overall company portfolio
196
Portfolio analysis
198
Prevnar
199
Pipeline analysis
201
Prevnar 13
203
ACC-001
204
MnB rLP2086
204
Deals and alliances
205
Product deals
205
License agreement with RIVM for meningitis B vaccine
206
Alliance with Elan for development of new drugs to treat Alzheimer's disease
206
M&A, public-private partnerships
207
Equity Investment in Alphavax
208
Technology deals
208
In-licensing of Inhibitex's MSCRAMM (Microbial Surface Components Recognizing Adhesive Matrix Molecules) protein technology
210
Inlicensing of Inovio's DNA delivery technology
210
Grants and government contracts
210
Strategic outlook
211
Strengths: Wyeth will continue to dominate the pneumococcal vaccine market
212
Weaknesses: strong reliance on Prevnar franchise as sole revenue generator
213
Opportunities: strong focus on new geographies and target groups
214
Threats: emerging competitors in key revenue sectors
214
CHAPTER 8 NOVARTIS - THE NEWCOMER
216
Summary
216
Strategic overview
217
History of vaccines division
217
Sales performance
220
Geographic spread
221
Seasonality
222
Role of vaccines in overall company portfolio
223
Portfolio analysis
224
Influenza vaccine franchise
225
Travel vaccine franchise
227
Meningitis vaccines
228
Pediatric/adult DTP/polio/Hib vaccines
229
Pipeline analysis
230
Meningitis
234
Influenza
235
Novel therapeutic vaccines
236
CAD106 (Alzheimer's disease, Phase II)
236
Nic002 (nicotine dependence, Phase II)
236
Others
237
Deals and alliances
238
Product deals
238
Strategic partnership with Intercell
241
Marketing and distribution agreement for Intercell's Ixiaro
241
In-licensing of CAD106 and Nic002 from Cytos Biotechnology
242
M&A, distribution and marketing agreements
242
Acquisition of Chiron
244
Acquisition of PowderJect and Spin-off of PowderMed by Chiron
245
Divestment of SBL Vaccin AB
246
Technology deals
246
Grants and government contracts
247
Strategic outlook
249
Strengths: Novartis has a strong influenza portfolio and excellent science
250
Weaknesses: two years after the acquisition of Chiron, Novartis's vaccine division is still fragmented
251
Opportunities: Menveo and Men B as potential blockbusters
251
Threats: competition in the meningitis space is fierce
252
BIBLIOGRAPHY
253
Company financial reports
253
Merck & Co
253
Sanofi Pasteur
253
GlaxoSmithKline
253
Wyeth
254
Novartis
254
Further literature
254
APPENDIX
263
Contributing experts
263
Report methodology
263
About Datamonitor
264
About Datamonitor Healthcare
264
About the Infectious Diseases analysis team
265
Key therapy team members
266
Holger Rovini, Head of Respiratory and Infectious Diseases
266
Hedwig Kresse, Senior Analyst, Infectious Diseases
266
Disclaimer
268
List of Tables
Table 1: Vaccine sales and growth rates of the top five vaccine manufacturers, 2004-9M2008
26
Table 2: Sales breakdown of the four best-selling vaccines, 2004-9M 2008
31
Table 3: Recent key mergers and acquisitions in the vaccines industry, December 2008
32
Table 4: Summary of opportunities and threats in the vaccines market, 2008
39
Table 5: Merck & Co - vaccine portfolio overview, December 2008
61
Table 6: Merck & Co - Gardasil product overview
62
Table 7: Merck & Co - RotaTeq product overview
64
Table 8: Merck & Co - Zostavax product overview
66
Table 9: Merck & Co - hepatitis franchise product overview
68
Table 10: Merck & Co - other viral vaccines product overview
70
Table 11: Merck & Co - other vaccines product overview
72
Table 12: Merck & Co - vaccine pipeline overview, December 2008
74
Table 13: Merck & Co - key vaccine product deals, December 2008
82
Table 14: Merck & Co - Vaccine joint venture with Sanofi Pasteur
85
Table 15: Merck & Co - key vaccine technology deals, December 2008
86
Table 16: Merck & Co vaccines - SWOT analysis, December 2008
88
Table 17: Sanofi Pasteur - vaccine portfolio overview, December 2008
102
Table 18: Sanofi Pasteur - influenza vaccine franchise product overview
103
Table 19: Sanofi Pasteur - pediatric combination vaccine franchise key product overview
107
Table 20: Sanofi Pasteur - booster vaccine franchise product overview
110
Table 21: Sanofi Pasteur - meningitis/pneumonia vaccine franchise product overview
112
Table 22: Sanofi Pasteur - traveler/endemic vaccine franchise product overview
115
Table 23: Sanofi Pasteur - vaccine pipeline overview, December 2008
119
Table 24: Sanofi Pasteur - Key vaccine product deals (1); December 2008
131
Table 25: Sanofi Pasteur - Key vaccine product deals (2); December 2008
132
Table 26: Sanofi Pasteur - key vaccine M&A, public-private partnerships, distribution/marketing agreements, December 2008
135
Table 27: Sanofi Pasteur - key vaccine technology deals, December 2008
138
Table 28: Sanofi Pasteur - key grants and government contracts for vaccines, December 2008
140
Table 29: Sanofi Pasteur - SWOT analysis, December 2008
142
Table 30: GlaxoSmithKline - vaccine portfolio overview, December 2008
156
Table 31: GlaxoSmithKline - Infanrix franchise product overview
157
Table 32: GlaxoSmithKline - DTP adolescent booster product overview
157
Table 33: GlaxoSmithKline - hepatitis franchise product overview
159
Table 34: GlaxoSmithKline - influenza vaccine franchise product overview
162
Table 35: GlaxoSmithKline - other vaccines, overview
167
Table 36: GlaxoSmithKline - vaccine pipeline overview, December 2008
168
Table 37: GlaxoSmithKline - key vaccine product deals; December 2008
174
Table 38: GlaxoSmithKline - key vaccine M&A, public-private partnerships, distribution/marketing agreements, December 2008
178
Table 39: GlaxoSmithKline - key vaccine technology deals, December 2008
182
Table 40: GlaxoSmithKline - key grants and government contracts for vaccines, December 2008
184
Table 41: GlaxoSmithKline vaccines - SWOT analysis, December 2008
185
Table 42: Wyeth - vaccines pipeline, December 2008
202
Table 43: Wyeth - key vaccine product deals, December 2008
206
Table 44: Wyeth - key vaccine M&A, public-private partnerships, distribution/marketing agreements, December 2008
208
Table 45: Wyeth - key vaccine technology deals, December 2008
209
Table 46: Wyeth - key grants and government contracts for vaccines, December 2008
211
Table 47: Wyeth vaccines - SWOT analysis, December 2008
212
Table 48: Novartis - vaccine portfolio overview; December 2008
225
Table 49: Novartis - Influenza vaccine franchise product overview
226
Table 50: Novartis - travel vaccine franchise key product overview
227
Table 51: Novartis - meningococcal vaccine franchise product overview
228
Table 52: Novartis - clinical vaccine pipeline overview, December 2008
231
Table 53: Novartis - key vaccine product deals, December 2008
240
Table 54: Novartis - key vaccine M&A, public-private partnerships, distribution/marketing agreements, December 2008
244
Table 55: Novartis - key vaccine technology deals, December 2008
247
Table 56: Novartis - key grants and government contracts for vaccines, December 2008
248
Table 57: Novartis - SWOT analysis, December 2008
249
List of Figures
Figure 1: Comparison of IMS-reported versus company-reported global sales data for vaccines, 2007
10
Figure 2: Prevnar: global sales 2001-9M2008
16
Figure 3: Gardasil: sales 2004-9M2008
17
Figure 4: National Vaccine Injury Compensation Program - petition and award statistics, 1990-2008
20
Figure 5: Comparison of lifecycles of pharmaceuticals and vaccines
22
Figure 6: Market growth cycle for vaccines
23
Figure 7: Market shares of the five key vaccine players in total vaccine sales, 2004 versus 2007
24
Figure 8: Combined vaccine sales of the top five vaccine manufacturers, 2004-9M2008
25
Figure 9: Vaccines versus overall pharmaceutical sales, 2007
27
Figure 10: Vaccine sales as share of overall company pharmaceutical sales, 2004-9M2008
28
Figure 11: Key events impacting the vaccines market, 2004-08
29
Figure 12: 2007 vaccine sales of Merck & Co, GlaxoSmithKline, Wyeth, Novartis and Sanofi Pasteur MSD by geography
30
Figure 13: Share of leading vaccines on a product basis, 2004-2007
31
Figure 14: Birth cohort sizes - seven major markets versus BRIC countries
42
Figure 15: Possible strategies for penetration of emerging markets
43
Figure 16: Public sector costs of routine childhood immunization per child, US, 1975-2008
44
Figure 17: Number of enrolled patients in Phase III trials for selected vaccines
46
Figure 18: Presence of local/regional vaccine manufacturers in emerging geographies
47
Figure 19: Reported measles cases and MMR vaccination coverage in England, 1996--2007
49
Figure 20: Merck & Co - vaccines pedigree, 2008
54
Figure 21: Merck & Co - total vaccine sales, 2004-2008; Q1-Q3
56
Figure 22: Merck & Co vaccine sales - geographic spread, 2004-9M2008
57
Figure 23: Merck & Co - total vaccine sales, by quarter, 2006-9M2008
58
Figure 24: Merck & Co - vaccine sales as share of overall company pharmaceutical sales, 2004-9M2008
59
Figure 25: Merck & Co - vaccines versus overall pharmaceutical sales, 2007
60
Figure 26: Merck & Co - Gardasil sales by geography, 2004-9M2008
62
Figure 27: Merck & Co - RotaTeq sales by geography, 2004-9M2008
65
Figure 28: Merck & Co - Zostavax sales by geography, 2004-9M2008
67
Figure 29: Merck & Co - hepatitis franchise sales by geography, 2004-9M2008
69
Figure 30: Merck & Co - other viral vaccines sales by geography, 2004-9M2008
71
Figure 31: Merck & Co - other vaccines sales by geography, 2004-9M2008
73
Figure 32: Merck & Co - overlap between marketed vaccines portfolio and pipeline vaccines, December 2008
75
Figure 33: Merck & Co - clinical vaccines pipeline depth, December 2008
76
Figure 34: Sanofi Pasteur - history of vaccines division
96
Figure 35: Sanofi Pasteur - vaccines pedigree, 2008
97
Figure 36: Sanofi Pasteur - total vaccine sales, 2004-9M 2008
98
Figure 37: Sanofi Pasteur - total vaccine sales, by quarter, 2006-9M2008
99
Figure 38: Sanofi Aventis - vaccine sales as share of overall company pharmaceutical sales, 2004-9M2008
100
Figure 39: Sanofi Aventis - vaccines versus overall pharmaceutical sales, 2007
101
Figure 40: Sanofi Pasteur - influenza vaccine franchise sales, 2004-9M2008
104
Figure 41: Sanofi Pasteur - pediatric combination vaccine franchise sales, 2004-9M2008
108
Figure 42: Sanofi Pasteur - booster vaccine franchise sales, 2004-9M2008
110
Figure 43: Sanofi Pasteur - meningitis/pneumonia vaccine franchise sales, 2004-9M2008
113
Figure 44: Sanofi Pasteur - traveler/endemic vaccine franchise sales, 2004-9M2008
116
Figure 45: Sanofi Pasteur - other vaccine sales, 2004-9M2008
117
Figure 46: Sanofi Pasteur - share of Sanofi Pasteur MSD joint venture sales by vaccine class, 2004-9M2008
118
Figure 47: Sanofi Pasteur - clinical vaccines pipeline depth and breadth, December 2008
121
Figure 48: Sanofi Pasteur - overlap between marketed vaccines portfolio and pipeline vaccines, December 2008
122
Figure 49: GlaxoSmithKline - history of vaccines division
148
Figure 50: GlaxoSmithKline - vaccines pedigree, 2008
149
Figure 51: GlaxoSmithKline - total vaccine sales, 2004-9M2008
151
Figure 52: GlaxoSmithKline vaccine sales - geographic spread, 2004-9M2008
152
Figure 53: GlaxoSmithKline - total vaccine sales, by quarter, 2006-9M2008
153
Figure 54: GlaxoSmithKline - vaccine sales as share of overall company pharmaceutical sales, 2004-9M2008
154
Figure 55: GlaxoSmithKline - vaccines versus overall pharmaceutical sales, 2007
155
Figure 56: GlaxoSmithKline - Infanrix and Boostrix franchise sales by geography, 2004-9M2008
158
Figure 57: GlaxoSmithKline - hepatitis vaccine franchise sales by geography, 2004-9M2008
160
Figure 58: GlaxoSmithKline - influenza vaccine franchise sales by geography, 2004-9M2008
163
Figure 59: GlaxoSmithKline - Cervarix sales by geography, 2004-9M2008
164
Figure 60: GlaxoSmithKline - Rotarix sales by geography, 2004-9M2008
166
Figure 61: GlaxoSmithKline - overlap between marketed vaccines portfolio and pipeline vaccines, December 2008
169
Figure 62: GlaxoSmithKline - clinical vaccines pipeline depth and breadth, December 2008
170
Figure 63: GlaxoSmithKline vaccines pipeline - adjuvanted versus non-adjuvanted candidates, December 2008
188
Figure 64: Wyeth - vaccines pedigree, 2008
192
Figure 65: Wyeth - total vaccine sales (Prevnar), 2004-9M2008
193
Figure 66: Wyeth vaccine sales (Prevnar) - geographic spread, 2004-9M2008
195
Figure 67: Wyeth - total vaccine sales (Prevnar), by quarter, 2006-9M2008
196
Figure 68: Wyeth - vaccine sales (Prevnar) as share of overall company pharmaceutical sales, 2004-9M2008
197
Figure 69: Wyeth - vaccines (Prevnar) versus overall pharmaceutical sales, 2007
198
Figure 70: Wyeth - Prevnar sales by geography, 2004-9M2008
200
Figure 71: Wyeth - overlap between marketed vaccines portfolio and pipeline vaccines, December 2008
202
Figure 72: Novartis - history of vaccines division
218
Figure 73: Novartis - vaccines pedigree, 2008
219
Figure 74: Novartis- total vaccine sales, 2004-9M2008
221
Figure 75: Novartis vaccines and diagnostics sales - geographic spread, 2004-9M2008
222
Figure 76: Novartis - total vaccine and diagnostics sales, by quarter, 2006-9M2008
223
Figure 77: Novartis - vaccines and diagnostics sales as share of overall company pharmaceutical sales (excluding consumer health), 2004-9M2008
224
Figure 78: Novartis - overlap between marketed vaccines portfolio and pipeline vaccines
232
Figure 79: Novartis - clinical vaccines pipeline depth and breadth, December 2008
233
--------------------------------------------------------------------------------
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Wednesday, July 1, 2009
Goldman Sachs The Fourth Branch of the U.S. Government
Politics / Market Manipulation Jun 30, 2009 - 04:13 AM
By: Graham_Summers
Quietly and almost unnoticed by most Americans, the US Federal Government introduced a fourth branch to its political structure in 2006. As you know we already had three branches, they are:
The Judicial: the Supreme Court
The Executive: the President
The Legislative: Congress
This pretty much has us covered in terms of political strategy… but what about financial issues? Everyone knows Congress has no clue how to allocate capital. And the Executive Branch doesn’t exactly have a great track record when it comes to financial matters either (we’ve run a deficit virtually every year since 1970).
Shouldn’t we have a Financial Branch of government? A group of fiscal experts entirely devoted to keeping the US’s fiscal house in order?
Well, we actually do, but instead of installing a branch of smart, genuine financiers interested in benefiting the American people, we installed a bunch of greedy crooks intent on stealing as much of the public’s money as possible with no consequences what so ever.
Ladies and Gentleman, I present to you America’s Financial Branch of the Government: Goldman Sachs.
Trying to detail exactly how integrated Goldman has become to the Federal Government would be like trying to track the peanut butter swirls in Ben and Jerry’s Chocolate Peanut Butter Swirl ice cream. Indeed, with the exception of Ben Bernanke and a few other officials, Goldman Sachs provided all the lead characters for the Tragic Comedy that is our latest Financial Crisis.
Central to the entire mess is Hank “the Hammer” Paulson, our former Public Money Privatizer or Secretary of the Treasury as he is commonly known. To chronicle the full intricacy of Paulson’s web of cronies and the methods he used to funnel public funds to them and their business during the Crisis would require a book, not an essay.
However, one can draw a great deal of conclusions about Paulson’s central beliefs on business and politics by mentioning that one of his first positions of power was serving as assistant to John Erlichman, the central architect of Richard Nixon’s Watergate Scandal: a man who believed that when it came to wining seats of power, it’s best to break and enter, steal, and destroy one’s enemies at all costs.
Erlichman was convicted on conspiracy, obstruction of justice and perjury. Paulson went on to become CEO of Goldman Sachs.
Beyond Paulson, Goldman’s reach in this crisis is virtually unending. John Thain, former CEO of Merrill Lynch was a former Goldmanite. So was Robert Rubin, the Chairman of Citigroup. Then there’s Robert Steel, the head of Wachovia, Ed Liddy, who Paulson put in charge of the nationalized AIG, Mark Patterson, the current Treasury Chief of Staff, Neel Kashkari, the guy in charge of allocating TARP funds…
heck, even Tim Geithner was mentored by the afore-mentioned Robert Rubin.
What’s staggering is that no one seems outraged by all of this. It’s not too difficult to connect the dots on what happened: a former Goldman exec was put in charge of allocating public funds to other former Goldman execs who in turn allocated the funds to their employees in the form of bonuses and enormous salaries. Indeed, it’s telling that Paulson’s original proposal for the $800 billion bailout entailed NO curtailing or oversight of executive compensation at the firm’s receiving our money.
I’m starting to run out of room here. But if you’re interested in these issues and learning more about Goldman Sach’s involvement in our Federal Government, I STRONGLY urge you to read Matt Taibbi’s recent expose on the firm in Rolling Stone magazine. Be forewarned, you will be infuriated by what Taibbi reveals. But if it gets people contacting their local representatives and Senators asking why we haven’t launched any investigations into Paulson’s allocation of public funds.
You can see Taibbi’s article online at: http://zerohedge.blogspot.com/2009/06/goldman-sachs-engineering-every-major.html
I’ve put together a FREE special report detailing how to play the coming agriculture boom as well as other inflation hedges that can protect you portfolio from the Fed’s money printing. You can pick up a FREE copy at: www.gainspainscapital.com.
Good Investing!
Graham Summers
http://gainspainscapital.com
PS. I’ve put together a FREE special report detailing how to play the coming agriculture boom as well as other inflation hedges that can protect you portfolio from the Fed’s money printing. You can pick up a FREE copy at: www.gainspainscapital.com.
Graham Summers: Graham is Senior Market Strategist at OmniSans Research. He is co-editor of Gain, Pains, and Capital, OmniSans Research’s FREE daily e-letter covering the equity, commodity, currency, and real estate markets.
Graham also writes Private Wealth Advisory, a monthly investment advisory focusing on the most lucrative investment opportunities the financial markets have to offer. Graham understands the big picture from both a macro-economic and capital in/outflow perspective. He translates his understanding into finding trends and undervalued investment opportunities months before the markets catch on: the Private Wealth Advisory portfolio has outperformed the S&P 500 three of the last five years, including a 7% return in 2008 vs. a 37% loss for the S&P 500.
Previously, Graham worked as a Senior Financial Analyst covering global markets for several investment firms in the Mid-Atlantic region. He’s lived and performed research in Europe, Asia, the Middle East, and the United States.
© 2009 Copyright Graham Summers - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.
Graham Summers Archive
http://www.marketoracle.co.uk/Article11686.html
By: Graham_Summers
Quietly and almost unnoticed by most Americans, the US Federal Government introduced a fourth branch to its political structure in 2006. As you know we already had three branches, they are:
The Judicial: the Supreme Court
The Executive: the President
The Legislative: Congress
This pretty much has us covered in terms of political strategy… but what about financial issues? Everyone knows Congress has no clue how to allocate capital. And the Executive Branch doesn’t exactly have a great track record when it comes to financial matters either (we’ve run a deficit virtually every year since 1970).
Shouldn’t we have a Financial Branch of government? A group of fiscal experts entirely devoted to keeping the US’s fiscal house in order?
Well, we actually do, but instead of installing a branch of smart, genuine financiers interested in benefiting the American people, we installed a bunch of greedy crooks intent on stealing as much of the public’s money as possible with no consequences what so ever.
Ladies and Gentleman, I present to you America’s Financial Branch of the Government: Goldman Sachs.
Trying to detail exactly how integrated Goldman has become to the Federal Government would be like trying to track the peanut butter swirls in Ben and Jerry’s Chocolate Peanut Butter Swirl ice cream. Indeed, with the exception of Ben Bernanke and a few other officials, Goldman Sachs provided all the lead characters for the Tragic Comedy that is our latest Financial Crisis.
Central to the entire mess is Hank “the Hammer” Paulson, our former Public Money Privatizer or Secretary of the Treasury as he is commonly known. To chronicle the full intricacy of Paulson’s web of cronies and the methods he used to funnel public funds to them and their business during the Crisis would require a book, not an essay.
However, one can draw a great deal of conclusions about Paulson’s central beliefs on business and politics by mentioning that one of his first positions of power was serving as assistant to John Erlichman, the central architect of Richard Nixon’s Watergate Scandal: a man who believed that when it came to wining seats of power, it’s best to break and enter, steal, and destroy one’s enemies at all costs.
Erlichman was convicted on conspiracy, obstruction of justice and perjury. Paulson went on to become CEO of Goldman Sachs.
Beyond Paulson, Goldman’s reach in this crisis is virtually unending. John Thain, former CEO of Merrill Lynch was a former Goldmanite. So was Robert Rubin, the Chairman of Citigroup. Then there’s Robert Steel, the head of Wachovia, Ed Liddy, who Paulson put in charge of the nationalized AIG, Mark Patterson, the current Treasury Chief of Staff, Neel Kashkari, the guy in charge of allocating TARP funds…
heck, even Tim Geithner was mentored by the afore-mentioned Robert Rubin.
What’s staggering is that no one seems outraged by all of this. It’s not too difficult to connect the dots on what happened: a former Goldman exec was put in charge of allocating public funds to other former Goldman execs who in turn allocated the funds to their employees in the form of bonuses and enormous salaries. Indeed, it’s telling that Paulson’s original proposal for the $800 billion bailout entailed NO curtailing or oversight of executive compensation at the firm’s receiving our money.
I’m starting to run out of room here. But if you’re interested in these issues and learning more about Goldman Sach’s involvement in our Federal Government, I STRONGLY urge you to read Matt Taibbi’s recent expose on the firm in Rolling Stone magazine. Be forewarned, you will be infuriated by what Taibbi reveals. But if it gets people contacting their local representatives and Senators asking why we haven’t launched any investigations into Paulson’s allocation of public funds.
You can see Taibbi’s article online at: http://zerohedge.blogspot.com/2009/06/goldman-sachs-engineering-every-major.html
I’ve put together a FREE special report detailing how to play the coming agriculture boom as well as other inflation hedges that can protect you portfolio from the Fed’s money printing. You can pick up a FREE copy at: www.gainspainscapital.com.
Good Investing!
Graham Summers
http://gainspainscapital.com
PS. I’ve put together a FREE special report detailing how to play the coming agriculture boom as well as other inflation hedges that can protect you portfolio from the Fed’s money printing. You can pick up a FREE copy at: www.gainspainscapital.com.
Graham Summers: Graham is Senior Market Strategist at OmniSans Research. He is co-editor of Gain, Pains, and Capital, OmniSans Research’s FREE daily e-letter covering the equity, commodity, currency, and real estate markets.
Graham also writes Private Wealth Advisory, a monthly investment advisory focusing on the most lucrative investment opportunities the financial markets have to offer. Graham understands the big picture from both a macro-economic and capital in/outflow perspective. He translates his understanding into finding trends and undervalued investment opportunities months before the markets catch on: the Private Wealth Advisory portfolio has outperformed the S&P 500 three of the last five years, including a 7% return in 2008 vs. a 37% loss for the S&P 500.
Previously, Graham worked as a Senior Financial Analyst covering global markets for several investment firms in the Mid-Atlantic region. He’s lived and performed research in Europe, Asia, the Middle East, and the United States.
© 2009 Copyright Graham Summers - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.
Graham Summers Archive
http://www.marketoracle.co.uk/Article11686.html
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