People close to the negotiations said an announcement would probably be made before stock markets opened on Thursday morning. Neither company was available for comment on Wednesday night.
However, no imminent takeovers are believed to be pending, in spite of the ferment in the world's drugs markets, with medium-sized manufacturers in particular coming up for sale.
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What’s in a bag?
For years, hospitals have distributed “gift” bags to new mothers, courtesy of the drug companies that sell baby formula. Over the years, bag styles have changed, from pastel bunnies to sleek briefcase black. What hasn’t changed is the strategy: big formula companies are using hospitals to promote their product to new mothers.
In December of 2005, the Massachusetts Public Health Council voted to remove formula marketing from hospitals. Over the ensuring six months, Governor Romney killed the ban, fired two vocal members of the Public Health Council, and prevented any further debate on the regulation. Romney argued that the “heavy arm of government” was forcing mothers to breastfeed. Romney’s move has nothing to do with mothers’ choices, and everything to do with protecting special interests.
Contrary to formula company rumors, the ban would not have affected a mother’s choice. Women who chose to formula feed would still have gotten formula in the hospital. They could have dialed a 1-800 number to enroll in company coupon and sample programs. The formula companies could have shipped the bags to mothers’ homes. The ban simply said hospitals should not give out the bags.
So why were formula companies so upset? It’s simple: they don’t want to lose their edge. When a nurse or a doctor hands a new mother a bottle of a particular brand of formula, he or she implicitly endorses the brand, and formula companies know mom will stick with it. The bags are a key part of their strategy. And while the bag itself is “free,” the brand loyalty it establishes is expensive.
Drug companies spent more than $10 billion on free samples in 2002. The samples ensure that patients become accustomed to using a brand-name product, and then the companies reap enormous profits. Imagine a woman who goes to her doctor for a birth control pill prescription and, along with the prescription, gets a free sample of a new brand-name pill. After the free sample runs out, she discovers the pill is costing her $45 per month, while any of a long list of just-as-good generics would cost only $10 a month. That “free sample” ends up costing her $420 over a year.
Formula samples are no different. A US Department of Agriculture study found that hospital-brand formula costs two-thirds more than store-brand generics. Despite the huge price difference, the report notes that new moms tend to trust the hospital brand, and they stick with the more expensive product. Over a year, that can add up to more than $700 in excess costs. In an interview, a Romney spokesman called the ban “punitive” for formula-feeding mothers. In fact, getting these bags out of hospitals could save these families a lot of money.
Among moms planning to breastfeed, formula companies use the bags to create customers. In multiple studies, nursing mothers who were given marketing bags started using formula earlier than those who did not.
That’s a public health problem. All leading medical organizations recommend mothers give babies only breast milk for the first six months of life. Research has linked formula-feeding with myriad risks for mothers and babies. Moms who don’t breastfeed face higher rates of breast cancer, ovarian cancer and diabetes. And babies who receive formula have more ear infections, more hospital admissions, and, it seems, more obesity when they grow up. The obesity rate in Massachusetts has climbed 80 percent in the last 15 years. Hospitals shouldn’t be promoting a product that could make it worse.
Just three months of exclusive breastfeeding saves more than $300 in medical costs in a baby’s first year life. As policy makers work to enact the new health care bill, it seems incongruous to protect marketing strategies that could drive up costs.
Some may argue that people are so accustomed to marketing and advertising that a free bag shouldn’t influence them. The problem is, studies show that the bags do influence mothers. Formula companies enlist medical professionals to do their sales pitches for a reason. Mothers follow advice from doctors and nurses about their babies - that’s why hospital marketing is so powerful. When hospitals hand out these bags, they endorse brand-name baby formula, whether they intend to or not.
Brigham and Women’s Hospital, where I work, stopped distributing the formula company bags in February, independent of the Public Health Council regulations. Nine other Massachusetts Hospitals are also formula-bag free. Boston Medical Center led the way by removing formula marketing from its hospital rooms almost a decade ago, because they decided hospital-based marketing was unethical.
It’s time for all of the nation’s maternity hospitals to ban the bags. Doctors, nurses and hospital administrators need to put mothers and babies ahead of profit-seeking formula companies. Hospitals should market health, and nothing else.
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