I still like Allergan’s (AGN) portfolio of anti-aging drugs, especially it’s Botox franchise. But I’m not especially fond of the company’s current strategy of acquisitions in the very hot market for NASH drugs. Yes, someone will win a key franchise for these drugs that fight liver disease, but there’s a lot of competition in the race to stake out a leading claim and these days when drug prices are a big issue in the United States and other markets, a lot of competition means a lot of price pressure as insurers play one drug against another in order negotiate a deeper discount and a better price. I think ultimately Allergan’s value to any investor’s portfolio lies in the growth prospects for Botox and other drugs in an aging world full of people who would love to look a bit younger. That gives Allergan, which does already have a dominant position in that market, lots of value to the long-term investor even as the near term looks like more of a struggle. (In addition, speaking of value, the shares are down 40% since July 2015, as I know to my portfolio pain.) So as of tomorrow, November 22, I will be selling shares of Allergan out of my 12-18 month Jubak Picks portfolio. I will buy them for my 50 Stocks long term portfolio on the following day November 23. Allergan’s stay in my Jubak Picks portfolio has been relatively short–I added it to the portfolio back on July 30, 205 when it looked like the company would be bought by Pfizer (PFE). I thought that put a bottom under Allergan shares. After that deal collapsed, Allergan shares have gradually moved lower until today the closed at $191.14, a 41.88% drop from my purchase price at $328.87.
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