There have been some notable success stories among big pharma stocks this year. For example, share prices of Schering-Plough
Another winner has been Eli Lilly
About 32% of the patients treated with the experimental drug found that it did relieve symptoms associated with schizophrenia. The drug did not perform quite as well as Eli Lilly's own Zyprexa, which relieved symptoms in 41% of patients, but the experimental drug did result in fewer and more mild side effects than Zyprexa, which, it has been argued, causes increased cholesterol, increased risk of diabetes, and weight gain.
The data has prompted Eli Lilly to plan additional trials of the drug. Aside from the promise of this drug, Fools should consider additional positive aspects of the company's stock.
For one, there's the healthy annualized dividend yield of 3%. Another plus is the fact that the company posted robust earnings and sales growth in its Q2 and is showing little signs of letting up, given its diversified portfolio of drugs. And the company has been pressing for additional uses of its drugs that are already on the market. Last month, a Food and Drug Administration advisory panel recommended approval of its osteoporosis drug Evista to mitigate the risk of breast cancer in postmenopausal women. The company has also sought FDA approval for the use of its antidepressant Cymbalta for treating fibromyalgia.
Generally, 2007 has been tough for big pharma, but Lilly's earnings growth, coupled with the strength of its R&D pipeline -- highlighted by this most recent clinical trial data -- might suggest that there is opportunity for success there.
Glaxo, Johnson & Johnson, and Eli Lilly are Motley Fool Income Investor recommendations. Want to know what other dividend-paying stocks the newsletter has recommended? Find out with a free 30-day trial.