Merck (NYSE:MRK)

Merck’s stock plunged on the NYSE yesterday due to a new study that showed its antiarthritis COX-2 inhibitor, Vioxx, doubled the risk of heart attack and stroke in patients.

At a P/E of ~11 now, forward P/E <10, and with a yield of about 4.5%, I think it is very attractively priced. The stock is at an eight-year low, and it happened overnight.

The stock pays its dividend today (10/1) so should drop a bit more. If the stock doesn’t bounce today (despite the payout, which should push it down more), IMHO it would be a good idea to buy some on Monday.

No doubt lawyers will attack the company, but the study report shows that five people died while on Vioxx, and five people died while on a placebo.

It’s a risky bet, but it’s the best one I’ve seen in a major company in the last year.

Some interesting numbers… and insiders seem to be holding on mostly.

Potential drugs in the pipeline?


I will buy in around 30. Also, Someone in the know reccommended CHC to me which yields over 7%. Anybody have opinions on this one.

Interesting Squidly. . .

although the latest drop is just a continuation of its performance over the past few years.

Not that I have anything to brag about. I’ve been holding some Pfizer stock for a few years now (unfortunately I bought after Viagra came out, not before) and it too has been on a downhill slide. Compare the two over the past 5 years:

[color=red]OUCHHHH! [/color]

[quote]Drug stocks fall as editorials blast Merck, FDA

NEW YORK, Oct 7 (Reuters) - Shares of large drug makers fell on Thursday after a top U.S. cardiologist questioned the safety of new arthritis drugs and the performance of U.S. regulators in monitoring drug safety. Merck and Co., which recalled its popular arthritis pill Vioxx last week on safety concerns, and the U.S. Food and Drug Administration came under blistering attack from an editorial in the New England Journal of Medicine, and from a subsequent editorial in the British medical journal the Lancet.[/quote]

[quote] Pfizer falls on Celebrex concerns

Oct. 7, 2004. BOSTON (CBS.MW) – Pfizer’s shares dove more than 7 percent Thursday at one point after editorials in the New England Journal of Medicine indicated its drug Celebrex could possibly cause cardiovascular problems similar to those of Merck’s Vioxx.[/quote] … ist=google

Panda, you said you’re buying MRK at 30. Better talk to your broker tomorrow. It’s at 30.98 now.

From what I’ve been readin about MRK and Pfizer is that there is nothing in the pipeline that has potential. Plus those company are losing their patents on key drugs the next couple of years. There’s lots of articles about them recently like on

What are ur thoughts on Citigroup. It had decent results and it’s price is pretty low.

I’ve decided to stay away from MRK at the moment and just watch it.

It hasn’t hit bottom yet.

[quote]November 5, 2004
Lawyers Organizing for Mass Suits Over Vioxx

Hundreds of plaintiffs’ lawyers who claim that people were injured or killed by the painkiller Vioxx plan to meet next week to lay the groundwork for a nationwide legal assault against the drug’s maker, Merck.[/quote] … &position=