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U.S. Drug Companies Chase Vaccines

Wall Street Journal Original article ›

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Thre drug companies are placing bets on the vaccine business. Johnson and Johnson paid 302 million euros for 18% of Dutch biotech company Crucell NV, to jointly develop vaccines. Abbott Labs says it will acquire a unit of Belgian conglomerate Solvay SA for 4.5 billion euros in adeal that includes a vaccine business. And Merck obtained the marketing rights for a seasonal flu vaccine from Australia's CSL Ltd. This follows Pfizer's Wyeth acquisition. Low prices, high costs and fear of lawsuits made most drug makers to exit the business in the 1980's and 1990's. Now vaccine sales are growing faster than other prescription drugs and are largely protected from generic competition. And government agencies here in the USA and around the world are reliable buyers of vaccines as they seek to stockpile medicines that could be needed in aflu outbreak. Merck never exit the vaccine business and now makes 8 of 10 vaccines recommended for adults. Flu and other vaccines are especially attractive for entering drug markets in Brazil and China and developing countries. Governments lke the idea of lowcost prevention at $10 adose, and with this new relationships are developed in these countries. And even at price of $10 or $20 a dose they provide asteady stream of revenue.Vaccines are estimated to generate $21.5 billion in revenues by 2012 according to Sanofi-Aventis SA, which is a leading vaccine maker.

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