title: Does innovation in obesity drugs affect stock markets? An event study analysis.
abstract: OBJECTIVE
  This study empirically analyzes the effects of public information about the pharmaceutical R&D process on the market valuation of the sponsoring firm. We examined the market's response to scientific news and regulatory decisions about an antiobesity drug, rimonabant, and the effects on the sponsoring company (Sanofi-Aventis) and its incumbent competitors (Abbott and Roche).
  
  
  METHODS
  Event study methodology was used to test the null hypothesis of no market response. We covered the full life cycle of rimonabant (1994-2008), using a data set of daily closing price and volume.
  
  
  RESULTS
  The results suggest that scientific news in the initial stages of the drug R&D process (i.e., drug discovery, preclinical and clinical trials) had no significant effects. However, news related to regulatory decisions, such as recall or safety warning, had significant negative effects on the company's market value. No spillover/contagion effects on competitor firms were detected.
  
  
  CONCLUSIONS
  Market reactions occur at the time when the regulator takes decisions about drugs. Scientific news, even those of high-impact, may pass unnoticed.
authors.affiliation: Department of Quantitative Methods in Economics and Business, University of Las Palmas de Gran Canaria, Las Palmas (Canary Islands), Spain. jvperez@dmc.ulpgc.es
authors.forename: Jorge V
authors.initials: JV
authors.lastname: Pérez-Rodríguez
authors.forename: Beatriz
authors.initials: B
authors.lastname: González López-Valcárcel
mesh_terms: D019440:Anti-Obesity Agents / Q000191:economics*; D004345:Drug Industry; D006801:Humans; D040541:Marketing; D010880:Piperidines / Q000191:economics*; D011720:Pyrazoles / Q000191:economics*; D012106:Research; D000077285:Rimonabant; D035703:Therapies, Investigational
chemical_list: D019440:Anti-Obesity Agents; D010880:Piperidines; D011720:Pyrazoles; D000077285:Rimonabant