Ian Ellul

The credit crunch is in full sway, with some experts forecasting a year characterized by a global financial crises. Clearly demonstrating this, an important multinational generic company is being put up for sale, a deal which can reach $7.5 billion. On the other hand, this may provide a unique opportunity for brand-name pharmaceutical companies to diversify in the generic market, a strategy being followed by many to lengthen the profit life-cycle of drugs. We are also reading Merck & Co’s proposal to buy Schering-Plough for a mix of cash and shares valued at $41.1 billion, a deal which comes a few weeks after another US firm, Pfizer, announced its takeover of Wyeth for $68 billion.

Amidst all this, on a more positive note, in February, Finance Minister Tonio Fenech announced that a pharmaceutical company, Pharmacare Premium will be investing 10 million Euros on a new plant locally, which will be the first pharmaceutical company which will have a Maltese shareholding. Interestingly, it was reported that this investment will include research and development, something which this country sorely needs.

This period may also be a golden opportunity for advertising campaigns of companies. According to research carried out on 600 US companies by McGraw-Hill between the 1980-1985 recession, if companies cut in their advertising budgets in an economic slump, the cost to regain market share once the economy turns round would cost much more than the cuts saved. However, on the other hand, according this research, companies which advertised aggressively during the recession had sales 256% higher than those who cut back on advertising.

During the month of March, we have also seen Obama formally launch a drive for healthcare reform at a White House forum, telling experts about the costly and inefficient system which was dragging down the ailing U.S. economy. In his budget plan, Obama has in fact allocated $634 billion to help pay for the overhaul over the next 10 years.

Also in March we have seen Obama lift restrictions on federal funding for human embryonic stem cell research, reversing restrictions placed on the research by his predecessor, George W. Bush, freeing labs across the country to start working with embryonic cells. This move, viewed by many as profit-driven, has placed stem cell research companies in a bull market. However notwithstanding all this, ethical concerns have once again re-emerged – Can stem cell research instead be carried with adult stem cells or umbilical cord stem cells without the need to destroy embryos in the process? Is this funding morally and ethically justified?