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Glaxo's $25 Billion Stock "Prescription" Remedy

And from the first quarter of this year to the second quarter, revenue from the blockbuster pill in the U.S. slid $120 million. So, why are investors buying the beaten-down stock?

Well, Glaxo says it'll still be able to hit its earnings growth target for this year of 8%-10%. How? In part because it is raising its stock buyback program to a whopping $25 billion--$25 billion! It expects to finish it over the next two years. The stock buyback frenzy that's been fueling the overall market rally continues in full force.

But could the stock been in for a pullback in just a few days? Maybe. On Monday an FDA Advisory Committee meets to take up the safety of Avandia and a competing drug that works the same way, Actos, from Takeda Pharmaceuticals and Eli Lilly . The outcome could be a recommendation for a black box warning (the FDA's harshest) to be put on the label of the drug for congestive heart failure and the heart attack risk identified in the recent New England Journal of Medicine report that triggered the safety scare back in May. In a "First on CNBC" interview on "Squawk Box" this morning, Glaxo CEO JP Garnier expressed confidence in the drug and its fate. You can watch that interview below.

I will be reporting live from that meeting in beautiful downtown Gaithersburg, Maryland (that's where the FDA holds most of its panel meetings for some unknown reason) on Monday. Two days later, I will be reporting on a new drug for migraines from Glaxo and Pozen that could win FDA approval on or before Wednesday, August 1st. Trexima, which could be the successor to Glaxo's Imitrex, is believed to work faster and longer. An estimated 30 million people in this country get migraines. Glaxo investors have had a big one lately, but not today.

Questions? Comments? Pharma@cnbc.com

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