Message Font: Serif | Sans-Serif
No. of Recommendations: 2
Anybody have any idea to how much upside is available from 66 million on these drugs? It seems like a great deal and the perfect example of why cash strong pharmaceuticals have an advantage.

IMO, it seems a lot of money to spend for drugs with very limited niches.
The deal appears to be buying three drugs for cash totalling a bit over 3 times current annual sales. That could be a fair price or a waste of cash depending on what happens to sales of those drugs. I do not have figures on trends over the past few years. All I can tell you from my experience practicing medicine (primary care and ER) for 20 years is that I have not used any of them in over 10 years. The two asthma drugs probably get most of their use in inner city populations where asthma is a more refractory problem. I have heard that for whatever reason Europe uses more Cromolyn products that we do in US. It is a rare asthmatic in US who I hear about using these meds--they are thought of as third line therapy.
The antibiotic sounds like it has a niche in tertiary hospitals where nasty drug resitant strep is a problem. Again, this niche seems small to me and I am frankly surprised to hear sales for these drugs combined are as high as $66 million.
King has a lot going for it, but if they keep spending their money this way, I will remain an observer.

Urche (who recently sold KG after a brief holding because I was looking for some gain to offset losses)

Print the post  


What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.