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FDA Inspects Foreign Operations Once Every 9 Years; U.S. Every 30 Months
The FDA is planning on outsourcing more inspections of overseas factories within the next decade. This follows criticism from Congress about a lack of oversight for food and drugs made in other countries.
The FDA inspects U.S. manufacturing facilities every 30 months, compared to foreign drug facilities once every nine years on average, the Government Accountability Office reported in September. Even though the FDA has had federal employees in countries such as China since 2008, this model for increasing oversight won't be sustainable as demand for lower-cost resources leads to more non-U.S. manufacturing.
http://www.bloomberg.com/news/2011-02-10/fda-to-outsource-international-plant-inspections-as-oversight-criticized.html
FDA Budget to Increase
The FDA's budget will receive a 33 percent increase, or about $1 billion in additional funding in fiscal year 2012, for a total of $4.3 billion; FDA Commissioner Margaret Hamburg praised the proposed increase.
This means that FDA responsibilities continue to grow providing new resources so the agency can fulfill its growing responsibilities to the American public. The Alliance for a Stronger FDA applauded the Obama administration from sparing the agency substantial budget cuts.
One lobbyist for Washington, DC-based Food and Water Watch, stated the president's request is about half of what is needed to implement FDA's new food safety responsibilities and is hoping that the Administration will make up for what appears to be a modest down payment in FY 2012.
http://www.foodsafetynews.com/2011/02/obamas-2012-budget-plan-would-boost-fda-cut-fsis/
Novartis Acts to Stop Thiopental from Reaching the U.S.
Novartis and its Sandoz unit, maker of a generic version of thiopental, have taken steps to try to stop the drug from being sent to the U.S.
"Sandoz has also advised all of its subsidiaries with locally approved marketing authorizations for sodium thiopental to not sell the product to distributors or third parties that may be selling it into the U.S.," Novartis and Sandoz said in a statement.
Hospira, another company, was planning to shift production to its plant in Liscate, Italy. However, the Italian parliament will only allow the drug to be made there if Hospira can guarantee that it will not be used in capital punishment. Italy, a member of the European Union, has banned the death penalty and criticized the U.S. for allowing it.
http://www.reuters.com/article/2011/02/10/novartis-idUSLDE7191I220110210
From Mergers to Spinoffs
Big Pharma is now starting to think smaller. With the industry's stocks lagging well behind the overall market, some drug makers could do investors a big favor by spinning off noncore businesses.
The higher executives have profited from mergers and many are not working out; so now the companies are looking at downsizing by spinning off certain aspects of their companies.
Abbott Laboratories , Medtronic, and Pfizer could be especially big winners from spinoffs and divestitures and their stocks could jump 30% or more, based on estimates of breakup values says one drug stock analyst. This analyst further states, "The status quo is not working; bigger is not better." Breakups are a big trend in corporate America in all fields.
Diversification is a viable option as the core drug operations of most major companies face big challenges from patent expirations, government pricing pressure globally, and unpromising drug pipelines. Flat to decreasing profits in the coming years face several companies.
http://online.barrons.com/article/SB5000142405297020409840457613037
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