VOTE FOR ME
Well, not for me, exactly, but my prosperi-tea.
Long-time readers of this column know that I have a small stake in Honest Tea. It continues to grow. Most recently, Whoopi Goldberg was on the Martha Stewart show describing the poker parties she hosts.
Martha: “What do you serve to drink?”
Whoopi: ‘Well, I have alcohol for folks who drink. I don’t drink, so I have something called Honest Tea. Which is what I drink these days. Which is kinda great. It comes in bottles. Very nice.’
Honest Tea is in the running to receive Co-op America’s People’s Choice Award for the Most Green Business. Please consider taking 15 seconds to vote for Honest Tea. (We are so green, even some of our teas are green.)
The twists and turns with this one over the years (preferred stock, reverse splits, and so on), have been almost too complicated to calculate, as those of you who bought it know. But the bottom line is that there’s an offer to acquire it at $20 a share – which might even get bid up a couple of bucks before the dust settles – and the story should soon be over. Depending on where you bought it (and assuming the deal gets done, as now seems likely), you will have made anywhere from a decent profit to a five-fold return on your money. If only they were all this good.
This one could work out very well, also, but there’s no guarantee.
I thought few insurers would cover the company’s sole product, BiDil, because it’s so expensive. (The FDA-approved label says to take two tablets three times a day – six in all. With the tablets priced at $1.80 to the wholesaler, that’s around $4,000 a year . . . yet BiDil is simply the combination of two generic ingredients which, if purchased separately, cost one-sixth as much.) Instead, some of the state Medicaid plans are covering it, and with low co-pays. At least for now.
Supporters of the stock argue that there is no generic alternative to BiDil, because one BiDil tablet contains 37.5 milligrams of hydralazine and there is no generic hydralazine offered in that dosage. (And, for some reason, they can’t imagine a generic drug manufacturer ever offering one, either.) It’s available only in 25 mg and 50 mg doses.
But hang on a second. You’re supposed to take two BiDil tablets at a time, which means a total of 75 mg of hydralazine. So why not just take one 25 mg and one 50 mg generic hydralazine pill for a total of 75 mg? Whether your body gets that 75 mg from two BiDil pills or from two generic pills, it’s still 75 mg.
Those of us betting against the stock believe your body will not notice the difference.
The other BiDil ingredient is 20 mg of isordil, which is available generically in exactly that dosage.
So to replicate exactly the components of the two BiDil pills you’re supposed to take, you’d take two isordils and two hydralazines.
It may sound wildly complicated – taking four pills instead of two. But if it saves $3,000 a year, perhaps it’s a complication worth enduring.
Meanwhile, my guru writes, ‘by all rights there should be a significant increase in prescriptions based on the states that reimburse BiDil for Medicaid, and refills of prescriptions written in July and August. So far we have not seen prescriptions surge. I continue to expect sales to fall well short of analysts’ projections.’
CULTURE OF CORRUPTION
The New York Times has begun charging for on-line access to its superb columnists, but it doesn’t charge much – nothing, if you subscribe to the print edition – and maybe the New York Times is worth supporting with a few bucks now and then, just as NPR and McDonald’s are (don’t tell me you’ve never tossed a few coins into McDonald’s’ coffer). I just now caught up with Frank Rich’s column from October 2. In part:
. . . It’s not just Mr. DeLay, aka the Hammer, who is on life support, but a Washington establishment whose infatuation with power and money has contaminated nearly every limb of government and turned off a public that by two to one finds the country on the wrong track.
But don’t take my word for it. . . . Listen instead to Andrew Ferguson, of the conservative Rupert Murdoch magazine, The Weekly Standard. As far back as last December in a cover article on the sleazy lobbyist Jack Abramoff, Mr. Ferguson was already declaring ”the end of the Republican Revolution.”
He painted the big picture of the Abramoff ethos in vibrant strokes: the ill-gotten Indian gambling moolah snaking through the bank accounts of a network of DeLay cronies and former aides; the ”fact-finding” Congressional golfing trips to further the cause of sweatshop garment factories in the Marianas islands; the bogus ”think tank” in Rehoboth Beach, Del., where the two scholars in residence were a yoga instructor and a lifeguard (albeit a ”lifeguard of the year”). Certain names kept recurring in Mr. Ferguson’s epic narrative, most prominently Ralph Reed and Grover Norquist, Republican money-changers who are as tightly tied to President Bush and Karl Rove as they are to Mr. Abramoff and Mr. DeLay, if not more so.
The bottom line, Mr. Ferguson wrote, was a culture antithetical to everything conservatives had stood for in the Gingrich revolution of 1994. Slaying a corrupt, bloated Democratic establishment was out, gluttony for the G.O.P. and its fat cats was in. Mr. Abramoff and his gang embodied the very enemy the ”Contract with America” Congress had supposedly come to Washington to smite: ”’Beltway Bandits,’ profiteers who manipulate the power of big government on behalf of well-heeled people who pay them tons of money to do so.” Those tons of Republican money were deposited in the favors bank of K Street, where, as The Washington Post reported this year, the number of lobbyists has more than doubled (to some 35,000) since the Bush era began in 2000. Conservatives who once aspired to cut government ”down to the size where we can drown it in the bathtub” — as a famous Norquist maxim had it — merely outsourced government instead to the highest bidder. . . .
The DeLay and Abramoff investigations are not to be confused with the many others percolating in the capital, including, most famously of late, the Justice Department and S.E.C. inquiries into the pious Bill Frist’s divine stock-sale windfall and the homeland security inspector general’s promised inquiry into possible fraud in the no-bid contracts doled out by FEMA for Hurricane Katrina. The mother of all investigations, of course, remains the prosecutor Patrick Fitzgerald’s pursuit of whoever outed the C.I.A. agent Valerie Wilson to Robert Novak and whoever may have lied to cover it up. The denouement is on its way.
But whatever the resolution of any of these individual dramas, they will not be the end of the story. Like the continuing revelations of detainee abuse emerging from Afghanistan, Iraq and Guantánamo, this is a crisis in the governing culture, not the tale of a few bad apples. Every time you turn over a rock, you find more vermin. We’ve only just learned from The Los Angeles Times that Joseph Schmitz, until last month the inspector general in charge of policing waste, fraud and abuse at the Pentagon, is himself the focus of a Congressional inquiry. He is accused of blocking the investigation of another Bush appointee who is suspected of siphoning Iraq reconstruction contracts to business cronies. At the Justice Department, the F.B.I. is looking into why a career prosecutor was demoted after he started probing alleged Abramoff illegality in Guam. According to The Los Angeles Times, the demoted prosecutor was then replaced by a Rove-approved Republican pol who just happened to be a cousin of a major target of another corruption investigation in Guam. . .
Power corrupts. The Republican Party has power in spades.
Quote of the Day
Every debt is ultimately paid, if not by the debtor, then eventually by the creditor.~Jim Grant
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