I would not disagree with much in the article. No one knows if the current bird flu will be the next pandemic or how bad it will be.
According to the US CDC, in a normal flu season about 200,000 Americans are hospitalised - 38,000 die.
Most of those deaths occur in people older than 65. Influenza costs the U.S. economy about $12 billion annually in direct medical costs and loss of productivity.
The CDC indicates a "medium-level epidemic" could kill up to 207,000, hospitalize 734,000, and sicken about a third of the U.S. population. Direct medical costs would top $166 billion.
CDC believes that a H5N1 avian influenza that is transmittable from human to human could be even more devastating: they are assuming a mortality rate of 20 percent and 80 million illnesses, the United States could be looking at 16 million deaths and unimaginable economic costs.
Most people insure their houses against events that are unlikely to happen. The cost to "insure" the population against a bird flu that may not happen is relatively small even against the 12 billion cost of normal seasonal flu.
I insure my house but only have third party property on my car - cost vs benefit on the car is not so good. I thought that BTA may have been on a winner treating regular flu. However, GSK, like most drug companies, appear to be more focussed on developing and marketing drugs that people have to take every day (cholesterol, blood pressure, viagra) than on pumping money into drugs that people may only take once every couple of years.
The media is now providing the marketing for Relenza that GSK would not. The emerging resistance issues with Tamiflu that MAY not affect Relenza could provide some more upside if goverments decide to increase stockpiles of Relenza.
Are there downsides? Sure! BTA may lose the legal action, somone may discover that H5N1 can never become highly contagious H2H, H5N1 may develop resistance to Relenza or another better drug could come on the market. However, on the balance of probabilities, I think that BTA may still be worth the gamble!
Cheers
Mick
BTA Price at posting:
0.0¢ Sentiment: Buy Disclosure: Not Held
