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Investors have a lot to worry about: Is it really worse than they think? Can they make money in a bear market? What kind of spatula should they buy? But they shouldn't worry about the current rumblings in Washington regarding the safety of Merck's (NYSE: MRK ) and Schering-Plough's (NYSE: SGP ) Vytorin.
Two Congressmen have requested 10 years worth of information about the drug's development, after the SEAS trial suggested that Vytorin might cause elevated levels of cancer. The trial found 93 cancer cases among subjects taking Vytorin, compared with 65 taking a placebo, but researchers concluded that it was an anomaly associated with the small size of the trial. When the data was combined with data from another trial, the increase went away. The types and timing of the cancers seen in the trial also weren't consistent with the hypothesis that the drug was causing the tumors.
The FDA is also jumping on the investigation bandwagon; it plans to evaluate the data once it receives the information from the doctors who ran the SEAS trial. One has to wonder whether the agency received pressure from the aforementioned Congressmen, considering that one of them asked the agency for a preliminary copy of the SEAS report a few weeks ago. Welcome back to the wonderful world of congressional investigations, Merck and Schering.
While I don't think that the investigations are likely to turn up anything, investors should at least keep up with the amount of news surrounding the probe. If the media continues to play this up, patients might just switch to other cholesterol drugs from Pfizer (NYSE: PFE ) , AstraZeneca (NYSE: AZN ) , or Abbott Labs (NYSE: ABT ) before the verdict is in.
As investors in drugmakers are all too familiar with, unknown -- and sometimes known -- side effects can cause huge drops in a company's stock. Hopefully for investors, talk of this, to me, non-existent side effect dies down as fast as it popped up.