Wednesday, August 24, 2011

Big Pharma Cash Hoards Seem Earmarked for Opportunities in Emerging Markets

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tdp2664 InvestorPlace Many Americans have seen their bank accounts dwindle as the recession has forced them to dip into savings to make ends meet. But the opposite is true with several leading members of Big Pharma. They're piling up cash so fast that even the federal government would have a hard time spending it all. Flush with cash is Johnson & Johnson (NYSE: JNJ ), with about $28 billion in its coffers. Pfizer's (NYSE: PFE ) piggy bank is overflowing with $25 billion. Merck (NYSE: MRK ) has stashed away an additional $1 billion this year, swelling the company's pocketbook to about $11 billion. We're all familiar with the expression "cash is king," but does that mean these three drug makers are great investment opportunities? Not necessarily. There's certainly nothing wrong with a company having a ton of cash. After all, it helps insulate the firm against tough times, and it gives companies more options for future growth.



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