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Senate bill targets large compounding pharmacies

Written By Unknown on Sabtu, 27 April 2013 | 00.32

WASHINGTON — Large specialty pharmacies like the one that triggered a deadly meningitis outbreak last year would be subject to federal safety inspections and manufacturing standards under a new Senate proposal introduced Friday.

The draft bill is the first Senate effort to address the recent outbreak tied to contaminated compounded drugs that sickened more than 700 Americans and killed more than 50 others.

The wave of deadly fungal infections was identified in September and linked to a large Massachusetts compounding pharmacy, which regulators said was operating more like a manufacturer.

The new proposal would subject such large compounding operations to direct federal oversight by the Food and Drug Administration, rather than the state pharmacy boards that have traditionally overseen them.

Compounding pharmacies mix customized solutions, creams and other medications in formulas specified by a doctor's prescription. Over the last two decades though, larger compounding operations have emerged that produce medications in bulk and ship them across state lines.

The New England Compounding Center, which triggered the meningitis outbreak, shipped more than 17,600 doses of its pain injection to 23 states.

Last week, FDA Commissioner Margaret Hamburg said her agency was not aggressive enough in policing the company because of the conflicting patchwork of state and federal laws that govern pharmacies. The Senate bill is designed to clear up that ambiguity.

"By clarifying FDA authority over high-risk compounding practices, this bill will enhance protections for patients taking compounded drugs and help prevent crises like last year's tragic meningitis outbreak," said Sen. Tom Harkin, D-Iowa, who chairs the Senate Health, Education, Labor and Pensions Committee. The bill was drafted with support from Republicans on the committee, including Sens. Lamar Alexander, R-Tenn., and Pat Roberts, R-Kan.

The bill identifies "compounding manufacturers" as pharmacies that produce injectable drugs and ship them across state lines without patient-specific prescriptions from doctors. These operations will have to register with the FDA, report the drugs they make and meet standards similar to those required of drug manufacturers.

Traditional compounding pharmacies, generally small operations that work with individual doctors, will continue to be regulated by state pharmacy boards. But the bill sets minimum standards for ingredients used by all compounding pharmacies.

As the first bipartisan bill in Congress aimed at addressing last year's outbreak, observers say the Senate legislation has the best chance of becoming law. Several Democrats in the House of Representatives have introduced similar measures, but Republicans who control that chamber have shown little interest in passing new compounding legislation.

Previous congressional efforts to regulate the compounding pharmacies have been scuttled before, stretching back to the 1990s.

In the last attempt, senators including Roberts and Ted Kennedy, D-Mass, circulated a bill in 2007 that would have given the FDA more power to inspect compounders and set standards for sterile medications. But the legislation was abandoned after compounding pharmacists campaigned against it, visiting Capitol Hill and lobbying in Senate offices.

The industry's main trade group, the International Academy of Compounding Pharmacists, spent about $1 million lobbying Congress in the last decade, according to data from the Center for Responsive Politics.

The group said in a statement Friday that new categories like "compounding manufacturer" create "more confusion and further blurs the jurisdictional authority of regulators."

"IACP reiterates its position that state boards of pharmacy are responsible for the licensing and oversight of compounding pharmacies and the FDA is responsible for overseeing and regulating pharmaceutical manufacturers," the group said in an emailed statement.


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Downsized New York Times Co. sees spike in profit

The Boston Globe's daily print circulation dropped 10 percent in the first quarter of this year, while the Sunday newspaper suffered a 6 percent decline, executives at the New York Times reported yesterday during an earnings conference call.

Times Chief Financial Officer James M. Follo also noted that the Globe, which the Times officially put up for sale earlier this year, will increase its home delivery prices next month.

As for the much-anticipated sale of the Globe and other assets in the Time's New England Media Group, Follo said, "We expect to see a transaction in the second half of this year, and we are pleased with the interest expressed to date."

The news comes as the Times reported a significant spike in its operating profit for the first quarter of 2013, which, at $22.9 million, is almost double the $12.6 million operating profit for the same time last year.

Executives at the dramatically downsized company said increased income from paid digital subscriptions and a marked decline in spending are behind the boost.

"Our first-quarter results reflect our continued strides in reshaping The New York Times Company," Times Co. President and CEO Mark Thompson said in a prepared statement. "The increase in operating profit, excluding depreciation, amortization and severance, was driven by solid growth in circulation revenues coupled with tightly managed costs."

But the uptick in operating profits didn't translate into increased earnings for shareholders. The company says this quarter's diluted earnings were $0.02 per share, compared with $0.06 per share last year.

But on the good news front, the Times says it experienced a 45 percent spike in digital subscriptions between the end of 2012 and the first quarter of 2013.

That spike — which gives the company 708,000 paid online subscribers — helped offset a very difficult advertising environment, it says.

The Times has shed hundreds of employees in recent years.

The report shows the company paid $5 million in employee severance costs in the first quarter 2013, and $5.3 million in the first quarter of 2012.


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Biogen’s revenue, earnings soar

Shares of Biogen Idec rose more than 5 percent yesterday after the Weston-based biotechnology company said its first quarter revenue was $1.4 billion, a 10 percent increase compared to the same period last year.

Biogen's revenue gains were led by the performance of its multiple sclerosis drugs Avonex and Tysabri. Avonex revenues increased 13 percent year-over-year to $746 million, while Tysabri revenues rose 9 percent year-over-year to $312 million.

Biogen's revenue for the first quarter of 2012 were $1.29 billion.

The company's net income rose to nearly $427 million, or $1.79 per share. A year ago, Biogen earned nearly $303 million, or $1.25 per share.

Officials added the company netted a $433 million gain due to a federal manufacturing deduction, which reduced the company's tax rate.

The company saw a 7 percent year-over-year decrease in revenue for its cancer drug Rituxan, officials said.

Biogen added the U.S. Food and Drug Administration approved its drug Tecfidera last month as a new oral treatment for people living with relapsing forms of multiple sclerosis. The drug is now available to MS patients across the United States, officials said.

The company also updated its full-year guidance. Biogen now expects its revenue growth to be from 16 percent and 18 percent; and its non-GAAP diluted earnings per share to be between $7.80 and $7.90.

Biogen stock reached a high of $217.67 today.


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TJX CEO Carol Meyrowitz gets the max

TJX Cos. CEO Carol Meyrowitz got a massive pay boost last year as her compensation nearly doubled to $21.7 million, according to documents the Framingham-based company filed with the Securities and Exchange Commission yesterday.

A spokeswoman for the off-price retailer said Meyrowitz's compensation was "heavily weighted towards performance-based incentives in 2012."

"TJX delivered excellent, well-above-plan performance in 2012, increasing sales by 12 percent, earnings per share by well over 20 percent and total return to shareholders to 36 percent," said TJX Cos. spokeswoman Sherry Lang.

In addition to Meyrowitz's base salary of $1.4 million, she was awarded $11.4 million in stock and option awards; $6 million in incentive plan compensation; $2.7 million in deferred compensation; and $48,550 in other benefits — including $36,594 for auto transportation and $5,940 for financial planning and legal services, according to SEC documents. Meyrowitz was paid $11 million in 2011.


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Raytheon Co. earnings beat estimates

Waltham-based defense company Raytheon Co. beat Wall Street estimates this week with adjusted earnings per share 28 cents higher than expected, and net sales that topped expectations despite a year-over-year drop.

The company reported adjusted earnings of $1.56 per diluted share, a 5 percent increase from the first quarter of 2012. Net sales dropped to nearly $5.88 billion, compared to almost $5.94 billion for the same period a year earlier, but still surpassed analyst estimates of $5.7 billion.

"Strong program execution drove solid operating results in the first quarter," said Raytheon's Chairman and CEO William H. Swanson. "Our innovation and technology, along with our focus on productivity, agility and affordability, continue to create value for our customers and shareholders."

The company's net income was up to $488 million compared to $448 million during the same quarter last year.

The company's Integrated Defense Systems unit had first quarter net sales of $1.26 billion compared to $1.22 billion year-over-year which was primarily due to higher sales on a missile defense radar program for an international customer, officials said. While Missile Systems posted net sales of $1.45 billion, an 8 percent increase from the first quarter of 2012, Intelligence and Information Systems saw its net sales fall to $743 million because of lower sales on classified programs, officials said.

Raytheon's Network Centric Systems unit had first quarter net sales of $931 million, a 7 percent decrease from the same period last year. Space and Airborne Systems saw its net sales drop 4 percent to $1.2 billion.

Raytheon also updated its financial outlook for the year to reflect first quarter 2013 results and its current expectations of the effects of federal budget cuts. While net sales for the year are now expected to be between $23.2 billion and $23.7 billion, the company raised its guidance for its adjusted earnings per share to a range of $5.75 to $5.90.

Last month, Raytheon said it would eliminate 200 jobs as part of a company-wide reorganization. At the time, company officials didn't say where the job losses will come, or how heavily they will fall in the Bay State.

Raytheon's new structure has four units: Intelligence, Information and Services, which is absorbing Raytheon Technical Services; Integrated Defense Systems; Missile Systems; and Space and Airborne Systems. The company said it will report second quarter 2013 financial results consistent with the new structure.


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Utility workers authorize strike against National Grid

Members of the Brotherhood of Utility Workers Union, comprised of six separate local unions in Massachusetts and Rhode Island, voted overwhelmingly today to authorize a strike against National Grid, citing concerns over the utility's low staffing levels, inadequate storm responses and ongoing payroll issues.

The vote comes as members of the Utility Workers Union of America, including Local 369, are in the midst of negotiations with National Grid on a new contract, which is set to expire on May 11.

"This vote is a testament to the ongoing mismanagement and mistakes that have plagued this utility for years now and have cost ratepayers millions," said Dan Hurley, president of the Brotherhood of Utility Workers Council and Local 369. "To date, the company has not shown a willingness to address these very serious issues in a satisfactory manner, and this must be resolved moving forward."

In December, National Grid was issued a $18.7 million fine for to its response to storms in 2011. Most recently, the utility was hit with a $270,000 fine by the Attorney General's Office for delays in paying hundreds of workers following Hurricane Sandy.

In addition, the company also encountered a series of payroll errors that produced inaccurate paychecks for thousands of workers for months and failed to distribute workers' W-2 forms by the Jan. 31 deadline, union members said.

"The mistakes and mismanagement at this company are out of control," Hurley said. "The continuous failures of National Grid are a direct slap in the face to ratepayers and taxpayers throughout Massachusetts and Rhode Island. This is clearly a company in crisis."

A National Grid spokeswoman could not be immediately reached for comment.


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Internet sales tax bill to hit roadblock in House

WASHINGTON — A bill to require Internet shoppers to pay sales taxes for online purchases may be cruising through the Senate but it will soon hit a roadblock in the House.

"There's a lot of political difficulty getting through the fog of it looking like a tax increase," said Rep. Steve Womack, R-Ark., one of the main sponsors of the bill in the House.

The bill would empower states to reach outside their borders and compel online retailers to collect state and local sales taxes for purchases made over the Internet. Under the bill, the sales taxes would be sent to the states where a shopper lives.

Under current law, states can only require stores to collect sales taxes if the store has a physical presence in the state. As a result, many online sales are essentially tax-free, giving Internet retailers an advantage over brick-and-mortar stores.

Womack says the bill is not a tax increase. Instead, he says, it simply gives states a mechanism to enforce current taxes.

In many states, shoppers are required to pay unpaid sales taxes when they file state tax returns. But governors complain that few people comply.

The Senate voted 63-30 Thursday to end debate on the bill, though senators delayed a final vote on passage until May 6, when they return from a weeklong vacation. Opponents hope senators hear from angry constituents over the next week, but they acknowledged they have a steep hill to climb to defeat the bill in the Senate.

President Barack Obama supports the bill.

Senate Democratic leaders wanted to finish work on the bill this week, before leaving town for the recess. But they were blocked by a handful of senators from states without sales taxes.

Oregon, Montana, New Hampshire and Delaware have no sales taxes, though the two senators from Delaware support the bill.

"I think it's going to be interesting for senators to get a response from constituents over this upcoming week," said Sen. Ron Wyden, D-Ore. "I'm not sure that the country knows that something like this coerces businesses all around America to collect other people's sales taxes."

The bill pits brick-and-mortar stores like Wal-Mart against online services such as eBay. The National Retail Federation supports it. And Amazon.com, which initially fought efforts in some states to make it collect sales taxes, supports it, too.

Retailers who have lobbied in favor of the bill celebrated Thursday's vote.

"The special treatment of big online businesses at the expense of retailers on Main Street will soon be a thing of the past," said Bill Hughes of the Retail Industry Leaders Association. "The overwhelmingly bipartisan support for leveling the playing field is rare in today's political environment and paves the way for a level playing field once and for all."

Supporters say the bill is about fairness for local businesses that already collect sales taxes and for states that lose revenue. Opponents say the bill would impose complicated regulations on retailers and doesn't have enough protections for small businesses. Businesses with less than $1 million a year in online sales would be exempt.

Many of the nation's governors — Republicans and Democrats — have been lobbying the federal government for years for the authority to collect sales taxes from online sales.

The issue is getting bigger for states as more people make purchases online. Last year, Internet sales in the U.S. totaled $226 billion, up nearly 16 percent from the previous year, according to Commerce Department estimates.

The National Conference of State Legislatures estimates that states lost $23 billion last year because they couldn't collect taxes on out-of-state sales.

Anti-tax groups have labeled the bill a tax increase. But it gets support from many Senate Republicans who have pledged not to increase taxes. The bill's main sponsor is Sen. Mike Enzi, a conservative Republican from Wyoming. He has worked closely with Sen. Dick Durbin, a liberal Democrat from Illinois.

Under the bill, states that want to collect online sales taxes must provide free computer software to help retailers calculate the taxes, based on where shoppers live. States must also establish a single entity to receive Internet sales tax revenue, so retailers don't have to send them to individual counties or cities.

"Obviously, there's a lot of consumers out there that have been accustomed to not having to pay any taxes, believing that they don't have to pay any taxes," Womack said. "I totally understand that."

But, he added, "It's not a tax increase and states can easily employ the proper software for the people to pay. At the end of the day it becomes more or less a political decision, and I'm not real sure where the House is going to be on it."

___

Follow Stephen Ohlemacher on Twitter: http://twitter.com/stephenatap


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New Corvette to start around $52,000, GM says

DETROIT — General Motors said Friday that a base model of the 2014 Corvette Stingray will start at just under $52,000.

Considering everything that GM put into the newest Corvette, the $1,400 price increase over the current model seems pretty modest.

The 2014 Corvette goes on sale this summer. The latest version was completely redone, and shares only two parts with the current model, which is nine years old.

The car was the talk of the Detroit auto show in January because of the dramatic changes GM made to it.

The 1,000-person team at GM made the car lower and sleeker, saving weight by replacing the steel structure with aluminum. The hood is made of lightweight carbon fiber. The interior gets a more modern look with new touch screens.

Under the hood, the car gets a new 450-horsepower, 6.2-liter V-8 engine that can go to four cylinders on the highway to save fuel. A new seven-speed manual transmission is standard. Even the base model can go from zero to 60 mph in under four seconds, a few tenths of a second faster than the current model.

Dealers say customers already are putting down deposits.

"Every day you have someone coming in wanting to know about the new Corvette," says Bill Perkins, owner of two Chevrolet dealerships in the Detroit suburbs. "You have a lot of enthusiasts out there. You have a lot of people that have purchased Corvettes before. A lot of people come in wanting to know the price, how soon they can get one."

A $1,400 increase is "not that much of a change when you look at everything that's happened to the car," said John Fitzpatrick, marketing manager for Chevrolet performance cars.

The car performs similar to a Porsche 911, yet a comparably equipped 911 would cost $100,000, Fitzpatrick said.


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Stocks mostly lower on tepid US economic growth

NEW YORK — The stock market sputtered Friday after the U.S. economy didn't grow as much as hoped. Neither did earnings from a handful of big companies like Amazon.com.

The economy grew at an annual rate of 2.5 percent in the first three months of the year, the government said, missing the 3.1 percent forecast of economists polled by FactSet, a financial data provider. That's still better than the anemic 0.4 percent growth rate in the October-December quarter.

The shortfall reinforced the perception that the economy is grinding, rather than charging, ahead. Investors have also been troubled by reports in the last month of weaker hiring, slower manufacturing and a drop in factory orders.

"There are some concerns as we head into the summer," said JJ Kinahan, chief derivatives strategist for TD Ameritrade. "In the last three weeks, we've have seen numbers that weren't exactly what you'd love to see."

Corporate earnings this week have also contained worrisome signs. Many companies have fallen short of analysts' estimates for revenue, even as they report higher earnings. For example, Goodyear Tire fell 2.3 percent to $12.64 after reporting revenue that fell short of analysts' estimates because of lower global tire sales.

Among other big names that investors were focusing on Friday, Amazon.com fell 7.2 percent to $254.60 after the company said it may report an operating loss in the second quarter. The online retailer's income fell in the first quarter as it continued to spend heavily on order fulfillment and rights to digital content. Expedia fell 9.5 percent to $58.80 after the online travel company's costs rose.

Homebuilder D.R. Horton surged 7.1 percent to $26.26 its income nearly tripled thanks to a continuing recovery the housing market. The results were handily beat the forecasts of financial analysts who follow the company.

Of the companies that have reported earnings so far, 69 percent have exceeded Wall Street's expectations, compared to a 10-year average of 62 percent, according to S&P Capital IQ. However, many have missed analysts' revenue estimates.

The Dow was down 10 points, or 0.1 percent, at 14,691 as of noon. The index is 1 percent higher in the week.

The S&P 500 index fell seven points to 1,578, or 0.4 percent, paring its gain for the week to 0.7 percent.

The Nasdaq composite was down 20 points at 3,269, a decline of 0.6 percent. The index is still 2 percent higher this week.

The tech-heavy index has lagged both the Dow and the S&P 500 this year, but led the way higher this week, boosted by Microsoft. The software giant, which makes up 5.3 percent of the Nasdaq, is on track to record its biggest weekly gain since January last year, after reporting earnings April 19 that beat Wall Street expectations and revealing an aggressive push into the computer tablet market.

Even Apple, the largest stock in the Nasdaq, had a good week, advancing 5.8 percent to $413.20, despite posting a decline in quarterly profit Tuesday. Apple accounts for 7.6 percent of the index's value and the weekly gain was its biggest since November.

On the whole, stocks have had a relatively poor April.

Stocks are still up for the month, but the gains are far below those made in the first three months of the year. The Dow and the S&P 500 are up 0.8 percent and 0.7 percent respectively in April, compared with the average gains of more than 3 percent they posted in January, February and March.

Slower hiring in the U.S. and weaker manufacturing held back stocks in April. The markets logged their biggest weekly decline in more than five months last week on concerns that global growth is faltering. China said its economy slowed in the first quarter.

J.C. Penney jumped 6.7 percent to $16.26 after the billionaire financier George Soros disclosed that he had taken a 7.9 percent stake in the company. Earlier this month the struggling department store chain fired its CEO, Ron Johnson, after 17 months on the job and rehired his predecessor Mike Ullman. An ambitious turnaround plan by Johnson had backfired and caused sales to plummet.

In government bond trading, the yield on the 10-year Treasury note fell to 1.67 percent from 1.71 percent, its lowest rate of the year.


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Two Boylston Street eateries reopening tomorrow

Two popular Boylston Street eateries — Abe & Louie's and the Atlantic Fish Co. — will reopen for business tomorrow at 5 p.m. after a 12-day closure following the Boston Marathon bombings.

"We are looking forward to welcoming back our community," said Bryan Lockwood, chief executive officer for the restaurants' parent company Tavistock Restaurants. "We really are like a family and we can't wait to get back to doing what we do best — hospitality."

City officials allowed business owners back into their businesses near Copley Square on Wednesday. The restaurants have spent the last few days repairing, prepping and cleaning from top to bottom, officials said.

Atlantic Fish Co. is at 761 Boylston St., while Abe & Louie's, an iconic steakhouse, is at 793 Boylston St.


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