Abbve Case Study Summary

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The Food and Drug Administration issued a warning that AbbVie's Viekira Pak and Technivie drugs for hepatitis C treatment can give patients serious liver injuries. Once this statement was released, AbbVie's shares took a serious dip while Gilead Sciences', their main competitor, soared. AbbVie's Shares Drop, it's Competitors Gain Gilead Sciences, on the other hand, has had its shares go up 6.4% to $108.10. One of AbbVie's collaborators, Encata Pharmaceuticals (ENTA), has taken a hit because of this statement and had its shares drop 32% to 27.12. Achillion Pharmaceuticals, known as ACHN, which is developing its own drug for hepatitis-C, has taken a 3.2% rise to $8.08. Express Scripts was also affected by the FDA's statement. The company, a pharmacy benefits manager, had made Viekira Pak and Technivie the treatment of choice for hepatitis-C patients in exchange for a discount from AbbVie. Their shares fell 6.1% initially, but they managed to regain some of the loss. In the latest update, its losses are reported at 3.7% to $83. …show more content…

Reactions to news like this tend to be overreactions. Although ISI is sympathetic to the market environment, but in this particular instance, the impact is unfounded and difficult to understand. With AbbVie's shares having taken such a hit, it looks like Gilead's main competitor for next year will be Merck, whose doublet regiment will have the The Prescription Drug User Fee Act law on its back in January 2016. Since the FDA made the announcement, its shares have gone up 3% to

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