Luckily, Lilly has a big drug in the pipeline – Prasugrel – to balance this out. The clotting therapy could do a billion dollars in sales in 2010. Then there are three drugs on the market right now – Cymbalta, Humalog and Cialis – to pick up the slack in the meantime. This stock barely makes the cut, but if you own it and you don’t want to part with it, Cramer has found a few reasons to keep it.
Even better, though, is Schering-Plough. Deutsche Bank predicts the company will face generics competition in about 70% of its business, and there are no new drugs in the pipeline, but Cramer’s still calling it a buy.
CEO Fred Hassan is a “true hero of capitalism,” Cramer says, and SGP’s cholesterol partnership with Merck (Vytorin and Zetia) is bringing in billions of dollars for both companies. The best reason to like SGP is that the government might lift the consent decrees that it slapped on the company for sloppy manufacturing practices. That should mean improved margins and cost cutting.
SGP has already had a big run, but below $28 Cramer recommends pulling the trigger.
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