Cholesterol drugs: Doubts about two favorites
Vytorin and Zetia, two widely prescribed anti-cholesterol treatments, “may not work and should be used only as a last resort,” said Alex Berenson in The New York Times. A panel of four leading cardiologists announced that startling conclusion this week after studying the results of a two-year clinical trial, which showed that Vytorin, a combination of Zetia and another drug, “did not slow, and might speed up, the growth of fatty plaques in arteries.” U.S. physicians write more than 3 million prescriptions for Vytorin and Zetia each month, believing that they’re more effective at reducing heart disease than an older class of drugs known as statins.
The findings are bad news for Merck and Schering-Plough, the drugs’ makers, said the Associated Press. Together, these drugs have “racked up $5 billion in sales despite limited proof of benefit.” Those sales could now plummet if physicians return to “older, tried-and-true treatments for high cholesterol.” Meanwhile, two congressional panels are investigating “why it took drug makers nearly two years after the study’s completion to release results.”
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E-commerce: IAC breakup gets the go-ahead
Barry Diller won a bitter court fight for control of e-commerce conglomerate IAC last week, besting cable mogul John Malone, said Joshua Chaffin in the Financial Times. Malone had sued Diller, claiming that Diller’s plan to split IAC into five separate companies violated an agreement with Malone’s Liberty Media, an early IAC investor. Diller, who was “at risk of being thrown out of the $5.7 billion Internet and e-commerce company” he founded, is now free to dismantle IAC, whose holdings include Ask.com, Match.com, and LendingTree.com.
Broadcasting: Cloudy skies for Clear Channel
The planned $19 billion buyout of broadcasting giant Clear Channel fell through last week, said Sarah McBride in The Wall Street Journal. The company now faces an “epic struggle: going it alone in a faltering radio industry.” The earlier agreement by private-equity giants Bain Capital and Thomas H. Lee Partners to buy Clear Channel collapsed when lenders balked at funding the transaction. Clear Channel and the buyout firms have sued the banks, but few observers expect the deal to close on its original terms.
Manufacturing: Japan’s factories cut back
Japan’s industrial output shrank for the second consecutive month, Japan’s trade ministry announced this week, as declining U.S. demand cut into orders, said the London Evening Standard. The data shows that Japan’s manufacturers are feeling the squeeze from the downturn in the U.S. economy. “The yen’s rise and record oil prices are eroding profits, just as the U.S. slowdown is hurting sales.” Few executives expect relief anytime soon. Confidence among Japan’s largest manufacturers has fallen to its lowest level in four years.
Banking: Citi’s reshuffling begins
Citigroup launched a dramatic reorganization this week, said Greg Morcroft in Marketwatch.com. The company is realigning its consumer-banking business along geographical lines, to bring decision-making closer to clients. Citi said it had recruited Teresa Dial, 58, from Britain’s Lloyds TSB Group to head up consumer banking in the U.S., Citi’s biggest market. The reorganization, Citi’s sixth such effort in 10 years, “is only the latest move in CEO Vikram Pandit’s long-term strategy to reposition the bank as a leaner, savvier market player.”
