We like a good safari story as much as the next insightful and timely OTC drug and nutritional product industries blogger, so we wanted to post these items about a firm on the acquisition trail, a lobby group cutting to the chase on health care reform and a commentator barking up the supplement regulatory tree.
Reckitt ready, but Colgate out of reach: The Financial Times reports...
Lobby group slams axing OTCs from FSAs: The Wall Street Journal reports ...
Conservative criticizes DSHEA: According to a CNN online piece ...
Reckitt ready, but Colgate out of reach: Reckitt Benckiser could be arming itself with capital for an acquisition hunt, but Colgate-Palmolive does not appear to be the target.
The Financial Times reported here that industry bankers familiar with the two companies say Reckitt is talking to lenders and is testing the markets to see how much capital it can raise. Reckitt, which acquired Adams Respiratory Therapeutics in 2008 for $2.3 billion as "The Tan Sheet" reported here, is cash-rich and can spend between $6 billion and $7 billion on an acquisition “without breaking into a sweat,” a lender told the FT.
The publication also reported lenders saying Colgate is too large for Reckitt to acquire and Colgate would not be open to being acquired by the smaller firm, necessitating a hostile takeover bid if Reckitt actually targeted the global health care, personal care and household products giant.
Lobby group slams axing OTCs from FSAs: The Save Flexible Spending Plans lobby group says the Senate health care reform bill would drive up costs by eliminating coverage of OTC medicines through flexible spending accounts.
The group, which represents employers and insurance companies, Nov. 18 issueda statement critical of the Senate bill, as the Wall Street Journal reported here.
The group says most FSA participants are middle income, earning approximately $55,000 annually, and eliminating OTC coverage "flies in the face of President Obama's pledge to not raise taxes on the middle class.”
"The Tan Sheet" reported here and here on the uphill battle the OTC and dietary supplement face in Congress for having their products covered in the benefits programs authorized in health care reform legislation.
Conservative criticizes DSHEA: A commentator with conservative bona fides straight from the George W. Bush White House, David Frum, adds his opinion to the criticism of the Dietary Supplement Health and Education Act that is generally fueled by Democrats.
In an op-ed published online by CNN, Frum calls for repeal of DSHEA and giving FDA "full authority over every manufactured substance that purports to promote health or relieve illness."
Critics of DSHEA and generally of how FDA regulations the supplement industry most often are Democrats -- more conservative lawmakers and commentators support the business enterprise and open-market environment that DSHEA encourages.
But the former speechwriter for President Bush, who now is a resident fellow at the American Enterprise Institute conservative think tank, claims DSHEA sanctions sales of products that are harmful to users' health. "Most of the products sold by the industry are merely useless" and the rules governing advertising of aspirin should also be applied "to the advertising of oregano tablets," Frum says.
"The Tan Sheet" reported here that with threats to amend DSHEA growing, stakeholders say the supplement industry is in its "most precarious position" since the law was enacted in 1994.
(Not a subscriber to "The Tan Sheet"? Click here for a free trial.)
-- Malcolm Spicer (m.spicer@elsevier.com)
