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Nov 6, 2006

Abbott Pays $3.7B to Step-Up Presence in Cholesterol Management Market

  • Abbott has acquired Kos Pharmaceuticals for $3.7 billion in cash to strengthen its position in the $20-billion cholesterol management market. The transaction is valued at $78 per share, a 56% premium over Kos’ closing price Friday of $50.09. "This acquisition expands Abbott's presence in the lipid management market and will provide several on-market and late-stage pipeline products," points out Miles D. White, chairman and CEO, Abbott.

    Kos’ two lead products are Niaspan®, an extended-release niacin product that raises HDL levels and Advicor®, a Niaspan/lovastatin combination product that treats patients with multiple lipid disorders. A new Niaspan caplet formulation with a range of dosages is currently under review. Kos predicts that it will submit Simcor®, a fixed-dose combination of Niaspan and simvastatin (generic Zocor®) to treat lipid disorders, for review in the first half of 2007.

    Abbott reports that these on-market cholesterol products and development opportunities will join its own lipid management portfolio, which includes on-market TriCor® and a TriCor/Crestor® development program with AstraZeneca.

    Abbott expects the transaction to be $0.02 to $0.03 dilutive to ongoing earnings per share in 2007, neutral to accretive in 2008, and building to significant accretion thereafter. Following the closing, the transaction is expected to result in one-time charges, primarily for in-process R&D and integration expenses.

    Kos opened Monday at $76.95, a 53.62% climb from its Friday close.

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Scientifically Studying Ecstasy

MDMA (commonly known as the empathogen “ecstasy”) is classified as a Schedule 1 drug, which is reserved for compounds with no accepted medical use and a high abuse potential. Two researchers from Stanford, however, call for a rigorous scientific exploration of MDMA's effects to identify precisely how the drug works, the data from which could be used to develop therapeutic compounds.

Do you agree that ecstasy should be studied for its potential therapeutic benefits?

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