This past Saturday night--Pfizer announced it's stopping production of its new anti-cholesterol drug torcetrapib. Unfortunately--clinical test results showed there were more deaths than expected from taking the experimental drug.
Catherine Arnold is a pharmaceutical analyst from Credit Suisse. While on "Squawk Box" Arnold said this is obviously a big deal for the world's largest drug company--and said her firm has lowered their target price for the stock from $28 a share to $24. Fair value says Arnold would be $23 to $24 a share. Arnold says she is neutral on the stock (analyst disclosure-Credit Suisse is an investment bank client of Pfizer). The stock is expected to see dramatic losses today.
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Arnold says this certainly raises questions about the effect of pharmaceutical drugs improving health--and it's double troubling for Pfizer which could lose 25% of its revenue source with the loss of torcetrapib.
Torcetrapib is supposed to increase the good cholesterol or HDL. It was the most important drug in Pfizer's new line of products--and a follow up to the company's lipitor drug. The company thought it would be a "blockbuster" and had been praising the new drug.
Pfizer CEO Jeff Kindler will be on "Power Lunch" today to talk about what happened.
