Embeda, a tamper-resistant extended-release pain drug, apparently flunked its stability test, so Pfizer is recalling all of the lots of the drug. It isn't clear when it'll be back on the shelves.
For a company the size of Pfizer, the loss of Embeda isn't that big of a deal. Through the first nine months of 2009, King only sold $34 million worth of Embeda. Thrombin-JMI and the Flector Patch were a bigger factor in the purchase of King than Embeda. Even if some patients head to other opioid pain medications -- Actavis' Kadian or Johnson & Johnson's
There's no real issue as long as this is an isolated incident and not the start of a chain reaction of problems like we've seen at Johnson & Johnson, Genzyme
The bigger issue might be whether Pfizer should have seen the recall coming; this isn't the first time there's been issues with Embeda that's caused recalls. Investors can only hope that management saw the potential for a recall, decided it wasn't enough to blackball the deal, and factored the potential for another recall into the purchase price.
Acquisitions and licensing deals are necessary for Pfizer to grow from here. If management can't be trusted to do its due diligence before entering the deal, investors will surely suffer. Unfortunately, it often takes years to see if a partnership or acquisition will pan out. And if they don't, it's easy to shrug it off as luck of the draw rather than a bad bet by management.
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