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Video: Solis Says Jobs Market Shows `Cautious Confidence’: Video

by on February 5, 2010

Feb. 5 (Bloomberg) — Labor Secretary Hilda Solis talks with Bloomberg’s Betty Liu about data showing the January jobs report. U.S. unemployment rate fell to 9.7 percent, the lowest level since August, the Labor Department said. Solis, speaking in Washington, also discusses President Barack Obama’s efforts to pass legislation creating jobs and measures to aid small businesses. (Source: Bloomberg)

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Video: Solis Says Jobs Market Shows `Cautious Confidence’: Video

U.S. Stocks Drop as Concern Over Technology Earnings Overshadows GDP Data

by on January 29, 2010

By Nikolaj Gammeltoft and Elizabeth Stanton Jan. 29 (Bloomberg) — U.S. stocks fell, dragging the Standard & Poor’s 500 Index to a three-month low, as disappointing results at technology companies offset government data showing the economy grew at the fastest pace in six years. Microsoft Corp. helped lead technology shares to the biggest drop among 10 groups as Chief Financial Officer Peter Klein said the company has yet to see a recovery in spending on enterprise software. SanDisk Corp., the biggest maker of flash- memory cards, slid 12 percent after its sales forecast fell short of some estimates. The S&P 500 fell for three straight weeks for the first time since July and capped its biggest monthly loss since last February. The S&P 500 slid 1 percent to 1,073.87 at 4:08 p.m. in New York. The Dow Jones Industrial Average fell 53.13 points, or 0.5 percent, to 10,067.33. The Nasdaq Composite Index lost 1.5 percent to 2,147.35. “Expectations have really been high,” said David Chalupnik , who oversees $8 billion as head of equities at First American Funds in Minneapolis. “Earnings have been coming out very strong, but it hasn’t been able to drive the market higher. The best example is Microsoft. They report very good numbers and the stock is down today.” The S&P 500 , which capped its third straight weekly drop, has tumbled 6.6 percent from a 15-month high on Jan. 19 after President Barack Obama called for limits on risk-taking by banks and China moved to restrict lending and cool economic growth. Stocks fell yesterday after Qualcomm Inc. lowered its sales forecast and speculation mounted Greece won’t be able to finance its budget deficit. January Barometer The index is down 3.7 percent year-to-date in its first monthly decline since October and the biggest since it plunged 11 percent last February. The performance of the S&P 500 in January is a reliable predictor of how it will do during the year, according to the Stock Trader’s Almanac. Before last year, when the index dropped 8.6 percent in January and rose 23 percent for the year, the so- called January barometer registered only five major errors since 1950, according to the almanac. The S&P 500 rose as much as 1.1 percent earlier after fourth-quarter economic growth and a gauge of business performance in January beat projections. The Commerce Department said the economy grew at a 5.7 percent rate in the fourth quarter, compared with a median forecast of 4.8 percent in a Bloomberg survey of economists. The Institute for Supply Management-Chicago Inc. said its business barometer climbed to 61.5 from 58.7 in December. The median forecast was for a drop to 57.2. Recovering Economy The U.S. economy is recovering from its longest recession since the Great Depression, caused by bank losses stemming from the collapse of the subprime mortgage market. S&P 500 profits are estimated to have risen 76 percent in the fourth quarter from the year-earlier period for the first increase since the second quarter of 2007, ending a record nine-quarter slump. Microsoft, the world’s largest software maker, fell 3.4 percent to $28.18 and was the biggest drag on the S&P 500. Fiscal second-quarter profit and revenue topped analyst estimates as consumers stepped up personal computer purchases during the last three months of 2009. Apple Inc. lost 3.6 percent to $192.06 in a second day of declines after introducing its iPad tablet computer. SanDisk, the biggest maker of flash-memory cards for digital cameras and mobile phones, fell 12 percent to $25.42 for its steepest decline in almost a year. The company anticipates sales of $875 million to $950 million in the first quarter, Chief Financial Officer Judy Bruner said yesterday on a conference call with analysts. The average estimate in a Bloomberg survey is $931 million. ‘Negative Nabobs’ S&P 500 companies that have released results posted an estimated combined profit of $16.83 a share, according to Bloomberg data. That compares with a loss of 9 cents a share in the year-ago quarter, according to S&P. Of the 196 companies in the S&P 500 that have reported earnings since Jan. 11, 156 have beaten analysts’ estimates, according to Bloomberg data. “The negative nabobs are just wrong,” said William Smead , chief executive officer of Smead Capital Management in Seattle, which oversees $170 million. “These companies are all so lean that as the economy surprises to the upside, the earnings power is going to be incredible.” To contact the reporters on this story: Nikolaj Gammeltoft in New York at ngammeltoft@bloomberg.net Elizabeth Stanton in New York at estanton@bloomberg.net

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U.S. Stocks Drop as Concern Over Technology Earnings Overshadows GDP Data

Vivus Erection Drug Avanafil Helps Men in 30 Minutes, Company Study Says

November 18, 2009

By Rob Waters Nov. 18 (Bloomberg) — Vivus Inc ., an unprofitable biotechnology company, said its experimental impotence drug helped men achieve erections in as little as 30 minutes in a study, or about twice as fast as Pfizer’s Inc.’s Viagra. Data showing the drug, called Avanafil, acts quickly will help Vivus seek U.S. permission to enter the $3.7 billion erection-drug market in 2011, said Chief Executive Officer Leland Wilson . Vivus shares rose as much as 12 percent. Wilson said he may introduce Avanafil in early 2012. As many as 322 million men worldwide may have erectile dysfunction by 2025, according to an Oct. 19 report by the American College of Physicians. Avanafil will grab market share because it works faster than the market-leading Viagra, which takes an hour to produce results and Eli Lilly & Co.’s Cialis, which takes about two, Wilson said in a telephone interview. “Patients want on-demand therapy because when the mood is right, the mood is right,” Wilson said. “We’ve shown efficacy in 30 minutes and no one else has done that.” Vivus jumped 48 cents, or 5.6 percent, to $9.05 at 10:06 a.m. New York time in Nasdaq Stock Market composite trading, after earlier touching $9.60. The company had risen 61 percent in the year before today. Avanafil could bring in $350 million by 2015, grabbing about the same market share as Levitra, said Jason Butler , an analyst for JMP Securities in New York, in a telephone interview yesterday. The key, he said, will be for Vivus to find a partner willing to spend money on promotion. Viagra, Cialis, Levitra In 2008, Viagra, made by New York-based Pfizer, the world’s biggest drugmaker, had about half of the erectile-dysfunction market. Cialis, made by Indianapolis, Indiana-based Eli Lilly & Co . had 40 percent and Levitra, made by Germany-based Bayer AG 10 percent. “This is a hugely promotion-driven market,” he said. “Viagra and Cialis win because they have sales reps that call on doctors every day of the week and they spend a huge amount on advertising.” Vivus won U.S. approval for its first erection product Muse in 1996, two years before Viagra was cleared for sale. Muse, a product designed to push erection-boosting medicine into the urethra, was quickly displaced by the little blue pill Viagra. Muse had revenue of $18.05 million last year. Vivus also is competing to introduce a new weight-loss drug for obesity patients with Arena Pharmaceuticals Inc. and Orexigen Therapeutics Inc. , both based in San Diego. The Mountain View, California-based company has said it will seek permission from the Food and Drug Administration to sell the treatment, Qnexa, by the end of the year. Partnership Needed While Vivus needs to form a partnership with a major drugmaker to market its erectile dysfunction pill, Wilson said he may wait to make a deal until the company has completed its clinical trials and submitted its application to the FDA. “As we move forward, it will increase our value,” he said. The Vivus study compared three doses of Avanafil to placebos in 646 patients with erectile dysfunction , a condition that affects 15 to 30 million U.S. men, according to a National Institutes of Health Web site. Before the late-stage study, 12 to 14 percent of men achieved erections that allowed them to have sexual intercourse. Men taking the lowest 50-milligram dose got erections 40 percent of the time, while those taking either the 100 milligram or 200 milligram doses achieved erections 57 percent of the time, according to a Vivus statement. Men taking placebos were able to have sex 27 percent of the time. Visual Distortions None of the patients had visual distortions such as those reported rarely by some Viagra and Cialis patients who said the drug added a blue tinge to their vision, Wilson said. The visual changes on those pills cleared up within a few hours, according to an Indiana University study reported April 13. About 85 percent of patients taking the Vivus drug completed the 16-week study. The most-common side effects were headaches, experienced by 7 percent of the men, facial flushing, experienced by 4.6 percent and nasal congestion, experienced by 2.3 percent. Patients in the study were men older than age 18 who had erectile problems for at least six months and excluded those taking nitrate heart medicines. Men using these medicines are also warned not to take the erectile dysfunction drugs on the market. Trials are under way for patients whose erection difficulties are linked to their diabetes , one of the most common causes of impotence, and for men who had surgery for prostate cancer, Wilson said. Viagra works within 30 minutes to 2 hours, according to prescribing information on the drug’s label. The median time to effectiveness is 60 minutes. Cialis, when taken as needed, can work within 30 minutes to 6 hours, according to prescribing information , with effectiveness achieved after a median of 2 hours. The drug can also be prescribed for daily use. To contact the reporter on this story: Rob Waters in San Francisco at rwaters5@bloomberg.net .

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Vivus Drug Helps Men Get Erections in 30 Minutes, Faster Than Competitors

November 18, 2009

By Rob Waters Nov. 18 (Bloomberg) — Vivus Inc ., an unprofitable biotechnology company, said its experimental impotence drug helped men achieve erections in as little as 30 minutes in a study, or about twice as fast as Pfizer’s Inc.’s Viagra. Data showing the drug, called Avanafil, acts quickly will help Vivus seek U.S. permission to enter the $3.7 billion erection-drug market in 2011, said Chief Executive Officer Leland Wilson . Vivus shares rose as much as 12 percent. Wilson said he may introduce Avanafil in early 2012. As many as 322 million men worldwide may have erectile dysfunction by 2025, according to an Oct. 19 report by the American College of Physicians. Avanafil will grab market share because it works faster than the market-leading Viagra, which takes an hour to produce results and Eli Lilly & Co.’s Cialis, which takes about two, Wilson said in a telephone interview. “Patients want on-demand therapy because when the mood is right, the mood is right,” Wilson said. “We’ve shown efficacy in 30 minutes and no one else has done that.” Vivus jumped 48 cents, or 5.6 percent, to $9.05 at 10:06 a.m. New York time in Nasdaq Stock Market composite trading, after earlier touching $9.60. The company had risen 61 percent in the year before today. Avanafil could bring in $350 million by 2015, grabbing about the same market share as Levitra, said Jason Butler , an analyst for JMP Securities in New York, in a telephone interview yesterday. The key, he said, will be for Vivus to find a partner willing to spend money on promotion. Viagra, Cialis, Levitra In 2008, Viagra, made by New York-based Pfizer, the world’s biggest drugmaker, had about half of the erectile-dysfunction market. Cialis, made by Indianapolis, Indiana-based Eli Lilly & Co . had 40 percent and Levitra, made by Germany-based Bayer AG 10 percent. “This is a hugely promotion-driven market,” he said. “Viagra and Cialis win because they have sales reps that call on doctors every day of the week and they spend a huge amount on advertising.” Vivus won U.S. approval for its first erection product Muse in 1996, two years before Viagra was cleared for sale. Muse, a product designed to push erection-boosting medicine into the urethra, was quickly displaced by the little blue pill Viagra. Muse had revenue of $18.05 million last year. Vivus also is competing to introduce a new weight-loss drug for obesity patients with Arena Pharmaceuticals Inc. and Orexigen Therapeutics Inc. , both based in San Diego. The Mountain View, California-based company has said it will seek permission from the Food and Drug Administration to sell the treatment, Qnexa, by the end of the year. Partnership Needed While Vivus needs to form a partnership with a major drugmaker to market its erectile dysfunction pill, Wilson said he may wait to make a deal until the company has completed its clinical trials and submitted its application to the FDA. “As we move forward, it will increase our value,” he said. The Vivus study compared three doses of Avanafil to placebos in 646 patients with erectile dysfunction , a condition that affects 15 to 30 million U.S. men, according to a National Institutes of Health Web site. Before the late-stage study, 12 to 14 percent of men achieved erections that allowed them to have sexual intercourse. Men taking the lowest 50-milligram dose got erections 40 percent of the time, while those taking either the 100 milligram or 200 milligram doses achieved erections 57 percent of the time, according to a Vivus statement. Men taking placebos were able to have sex 27 percent of the time. Visual Distortions None of the patients had visual distortions such as those reported rarely by some Viagra and Cialis patients who said the drug added a blue tinge to their vision, Wilson said. The visual changes on those pills cleared up within a few hours, according to an Indiana University study reported April 13. About 85 percent of patients taking the Vivus drug completed the 16-week study. The most-common side effects were headaches, experienced by 7 percent of the men, facial flushing, experienced by 4.6 percent and nasal congestion, experienced by 2.3 percent. Patients in the study were men older than age 18 who had erectile problems for at least six months and excluded those taking nitrate heart medicines. Men using these medicines are also warned not to take the erectile dysfunction drugs on the market. Trials are under way for patients whose erection difficulties are linked to their diabetes , one of the most common causes of impotence, and for men who had surgery for prostate cancer, Wilson said. Viagra works within 30 minutes to 2 hours, according to prescribing information on the drug’s label. The median time to effectiveness is 60 minutes. Cialis, when taken as needed, can work within 30 minutes to 6 hours, according to prescribing information , with effectiveness achieved after a median of 2 hours. The drug can also be prescribed for daily use. To contact the reporter on this story: Rob Waters in San Francisco at rwaters5@bloomberg.net .

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Stocks in U.S. Slump, Sending S&P 500 to First Monthly Drop Since February

October 30, 2009

By Rita Nazareth Oct. 30 (Bloomberg) — U.S. stocks tumbled, ending a seven- month streak of gains for the Standard & Poor’s 500 Index, as declines in consumer confidence and spending and the threat of a CIT Group Inc. bankruptcy raised concern over the durability of the economic recovery. The dollar and Treasuries gained, while commodities retreated. CIT , the commercial lender, plunged 24 percent as investor Carl Icahn agreed to support its prepackaged bankruptcy plan. Citigroup Inc. tumbled 5.1 percent on a report that banking analyst Mike Mayo predicted a $10 billion writedown for this quarter. American Express Co. and Walt Disney Co. slid as Commerce Department data showed a drop in purchases and the Reuters/University of Michigan sentiment index weakened. MetLife Inc. lost 7.6 percent after a third straight quarterly loss. “I’m well-spooked for the Halloween weekend,” said James Paulsen , who helps oversee $375 billion as chief investment strategist at Wells Capital Management in Minneapolis. “We can talk about disappointing consumer confidence data. Bank charge- offs are still happening. There’s a growing sense on the Street that there’s got to be a pullback.” The Standard & Poor’s 500 Index sank 2.8 percent, the most since July, to 1,036.19 at 4:05 p.m. in New York and wiped out yesterday’s 2.3 percent surge triggered by government data showing the economy returned to growth following the worst slump in seven decades. The Dow Jones Industrial Average sank 249.85 points, or 2.5 percent, to 9,712.73. The S&P 500 fell 2 percent in October to cap its first monthly decline since February. The Dow was little changed on the month. Surge of Orders A surge of sell orders triggered computer problems at the open of trading on the New York Stock Exchange, causing quotes on the Big Board and the NYSE Amex to be briefly interrupted. About 12 billion shares changed hands on all U.S. exchanges, 26 percent more than the three-month average. The VIX, the benchmark for U.S. stock options that is known as Wall Street’s “fear gauge,” jumped the most in a year on demand for loss protection. The VIX added 24 percent to 20.75, the highest since July 8. Billionaire investor George Soros said the global economic recovery is “liable to run out of steam” and a “double dip” may follow in 2010 or 2011. He spoke in Budapest today, in a lecture organized by the Central European University. Investor Wilbur L. Ross Jr . told Bloomberg Radio the U.S. is in the beginning of a “huge crash in commercial real estate.” ‘Wrong Direction’ “All of the components of real estate value are going in the wrong direction simultaneously,” said Ross, one of nine money managers participating in a government program to remove toxic assets from bank balance sheets. “Occupancy rates are going down. Rent rates are going down and the capitalization rate — the return that investors are demanding to buy a property — are going up.” The advance yesterday ended four sessions of losses spurred by growing concern that a rally of as much as 62 percent in the S&P 500 since March 9 had outpaced the outlook for earnings and economic growth. Today’s pullback came as the Commerce Department figures also showed incomes were unchanged in September. The report showed inflation was lower than the Federal Reserve’s long-term projection, indicating policy makers can keep rates low. Equities also fell today as the consumer confidence data signaled job losses may continue to restrain household spending. The final Michigan index of consumer sentiment decreased to 70.6 from 73.5 in September, which was the highest in more than a year. The index was forecast to fall to 70, the median in a Bloomberg survey of 60 economists. The dollar and yen rose against most major currencies on concern central banks around the world may be moving too fast to scale back measures designed to haul their economies out of the recession. Central banks are signaling they are ready to withdraw stimulus measures even as economic reports show the recovery from the worst global recession since World War II may be tepid. To contact the reporter on this story: Rita Nazareth in New York at rnazareth@bloomberg.net

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