http://www.profitableinvestingtips.com/investing-trading/too-late-to-short-glaxosmithkline
Too Late to Short Glaxosmithkline
It may be too late to short Glaxosmithkline (GSK) but so what. The fourth biggest company in “Big Pharma” just pled guilty and will pay a fine of $3 Billion in the largest health care fraud case in United States history. When the settlement was announced the stock fell from $1481 a share to $1487 a share, too late to short Glaxosmithkline. But how is it that a $3 settlement did so little to the price of the stock? It has to do with size and with the market having discounted the bad news. GSK is a British pharmaceutical company, the result of merging British Glaxo Pharmaceuticals with American Smith Kline & French. The company makes vaccines, biological, consumer health care products, and prescription drugs for the treatment of infectious diseases, asthma, diabetes, mental illnesses, digestive problems, and cancer. The company has a market capitalization of around $100 Billion and is the fifth largest company listed on the London Stock Exchange. It has a secondary listing on the NYSE. Although it is too late to short Glaxosmithkline regarding the company’s culpability in unlawful promotion of a number of prescription drugs it is not too late to a little investment research in the company going forward.
Unlawful Promotion of Prescription Drugs
When a prescription drug is OK’d by the FDA or regulatory agencies in other countries it is for a specific purpose such as treatment of diabetes, a type of infection, or a kind of cancer. However, physicians may discover that the drug works well for other purposes. This sort of off label use is common and is legal in the hands of licensed physicians. Such off label is commonly reported in medical journals. However, it is illegal for the drug company to promote these off label uses unless it does the correct studies and passes the new use before the FDA for its approval. The company pled guilty to misrepresenting the drugs Paxil and Wellbutrin, years ago, and not reporting problems with a diabetes drug, Avandia. Apparently the company promoted Paxil, an antidepressant for adults, for use in children under age 18 and essentially bribed physicians to use certain drugs with trips, dinners, and other inducements. When picking new winners and investing in other companies in similar straits investors are well advised to consider the consequences of various company actions and not end up in a situation such as this where it is too late to short Glaxosmithkline.
In the Meantime
While it is too late to short Glaxosmithkline there is still time to invest. While the legal suit was going forward Glaxosmithkline has continued to operate as one of the world’s largest pharmaceutical companies. Like all such companies it does its own research and development in order to find new medications. It also buys out and acquires small startups with interesting products and potential c
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Too Late to Short Glaxosmithkline
1. Too Late to Short
Glaxosmithkline
By
www.ProfitableInvestingTips.com
2. It may be too late to short
Glaxosmithkline (GSK) but so
what.
www.ProfitableInvestingTips.com
3. The fourth biggest company in
“Big Pharma” just pled guilty and
will pay a fine of $3 Billion in the
largest health care fraud case in
United States history.
www.ProfitableInvestingTips.com
4. When the settlement was
announced the stock fell from
$1481 a share to $1487 a
share, too late to short
Glaxosmithkline.
www.ProfitableInvestingTips.com
5. But how is it that a $3 settlement
did so little to the price of the
stock?
www.ProfitableInvestingTips.com
6. It has to do with size and with the
market having discounted the bad
news. GSK is a British
pharmaceutical company, the
result of merging British Glaxo
Pharmaceuticals with American
Smith Kline & French.
www.ProfitableInvestingTips.com
7. The company makes
vaccines, biological, consumer
health care products, and
prescription drugs for the
treatment of infectious
diseases, asthma, diabetes, ment
al illnesses, digestive
problems, and cancer.
www.ProfitableInvestingTips.com
8. The company has a market
capitalization of around $100
Billion and is the fifth largest
company listed on the London
Stock Exchange.
www.ProfitableInvestingTips.com
9. It has a secondary listing on the
NYSE.
www.ProfitableInvestingTips.com
10. Although it is too late to short
Glaxosmithkline regarding the
company’s culpability in unlawful
promotion of a number of
prescription drugs it is not too late
to a little investment research in
the company going forward.
www.ProfitableInvestingTips.com
12. When a prescription drug is OK’d
by the FDA or regulatory agencies
in other countries it is for a specific
purpose such as treatment of
diabetes, a type of infection, or a
kind of cancer.
www.ProfitableInvestingTips.com
13. However, physicians may discover
that the drug works well for other
purposes. This sort of off label use
is common and is legal in the
hands of licensed physicians.
Such off label is commonly
reported in medical journals.
www.ProfitableInvestingTips.com
14. However, it is illegal for the drug
company to promote these off
label uses unless it does the
correct studies and passes the
new use before the FDA for its
approval.
www.ProfitableInvestingTips.com
15. The company pled guilty to
misrepresenting the drugs Paxil
and Wellbutrin, years ago, and not
reporting problems with a diabetes
drug, Avandia.
www.ProfitableInvestingTips.com
16. Apparently the company promoted
Paxil, an antidepressant for
adults, for use in children under
age 18 and essentially bribed
physicians to use certain drugs
with trips, dinners, and other
inducements.
www.ProfitableInvestingTips.com
17. When picking new winners and
investing in other companies in similar
straits investors are well advised to
consider the consequences of various
company actions and not end up in a
situation such as this where it is too
late to short Glaxosmithkline.
www.ProfitableInvestingTips.com
19. While it is too late to short
Glaxosmithkline there is still time
to invest.
www.ProfitableInvestingTips.com
20. While the legal suit was going
forward Glaxosmithkline has
continued to operate as one of the
world’s largest pharmaceutical
companies.
www.ProfitableInvestingTips.com
21. Like all such companies it does its
own research and development in
order to find new medications.
www.ProfitableInvestingTips.com
22. It also buys out and acquires small
startups with interesting products
and potential competitors.
www.ProfitableInvestingTips.com
23. GSK has made an offer to buy
Human Genome Sciences.
www.ProfitableInvestingTips.com
24. The board has turned them down.
GSK is going forward with a
hostile takeover by attempting to
buy enough stock to simply put in
its own board of directors.
www.ProfitableInvestingTips.com
25. Our discussion about GSK and its
travails with the FDA is meant to
provide insight for investors.
www.ProfitableInvestingTips.com
26. Before buying or selling the
stock, investors will do well to
carry out their own fundamental
analysis.
www.ProfitableInvestingTips.com
27. For more information and tips
regarding profitable investing, visit
www.ProfitableInvestingTips.com.
