Drug Stocks

What happened today with Schering-Plough (SGP) is exactly why I have never bought a pharmaceutical stock and don’t plan to. I’ve always had this belief that every pharma company was one FDA study away from a 20% drop or worse and I had been meaning to write a blog post about this for a while. Of course on the flip side you could say with these stocks they always have a pop in them if they get approved for a new drug but the drug approval process creates so much volatility in these stocks as the FDA takes a very long time and creates many news stories causing lots of pops and drops on rumors of approval or FDA wanting more information.

I’d like to expand on this post with some more research to support my reasons but I’m moving to NYC tomorrow and I’m exhausted.