Does Big Tobacco Actually Love Pfizer’s Anti-Smoking ‘Chantix’ Pill? (MO, RAI, PFE)

Pfizer (NYSE:PFE) is seeing additional pressure this afternoon.  Apparently the FDA said it is looking into reports that Pfizer has sent out an "early communications notice" to doctors warning them to monitor patients using the popular "stop smoking" pill called Chantix with the note that it might trigger erratic behavior or possibly suicidal thoughts in some users.  The FDA has also noted that Chantix users should also be cautious whendriving or operating autos and machinery, as the drug has reportedlycaused some incidents of drowsiness. 

If you know an ex-smoker, you’d swear up and down that some of them were suicidal when they tried to quit before this drug ever came out.  This may be after that musician in Dallas was shot to death following him having an ‘altercation’ with his girlfriend before he ran out and pounding on a door in the middle of the night, so in all honesty this one might have been seen ahead.  Here is the official communication:

• "FDA informed healthcare professionals of reports of suicidal thoughts and aggressive and erratic behavior in patient who have taken Chantix, a smoking cessation product. There are also reports of patients experiencing drowsiness that affected their ability to drive or operate machinery. FDA is currently reviewing these cases, along with other recent reports. A preliminary assessment reveals that many of the cases reflect new-onset of depressed mood, suicidal ideation, and changes in emotion and behavior within days to weeks of initiating Chantix treatment. The role of Chantix in these cases is not clear because smoking cessation, with or without treatment, is associated with nicotine withdrawal symptoms and has also been associated with the exacerbation of underlying psychiatric illness. However, not all patients described in the cases had preexisting psychiatric illness and not all had discontinued smoking."

There is always a silver lining somewhere for someone.  If you are Altria (NYSE:MO) or Reynolds American (NYSE:RAI), then you probably just got a little more pep in your step.  Imagine a doctor saying, "I’d rather see you keep smoking and die one breath at a time rather than get suicidal."  Did that really happen that ANY physician said that?  Probably not.  But that is how a trader might view this.

Altria (NYSE:MO) is currently under review for the 24/7 Wall St. Special Situation Investing Newsletter.

Jon C. Ogg
November 20, 2007