Showrooming little threat to clothiers in ho-hum holidays






Chicago (Reuters) – In retail, showrooming has not hit shirts yet.


Showrooming, the retail term for shoppers who try a product, then buy it cheaper on Amazon.com or other websites, has driven retailers to the point of hiding barcodes, improving their own websites and coming up with methods to get people to complete their purchase in the store.






But brand-name clothing retailers have an advantage over companies that sell items you can buy anywhere, like televisions and home goods.


Specialty apparel retailers are some of the least affected by showrooming since the more exclusive the product is, the harder it is to showroom,” said Joel Bines, managing director of the retail practice at advisory firm AlixPartners.


That, in turn, has helped retailers like Gap Inc and Lululemon Athletica Inc find favor with investors.


A survey of 2,010 adults conducted by AlixPartners showed consumers who shop for apparel were among the least likely (35 percent) to go to other websites after they liked an item at a store, compared with 42 percent of electronics shoppers and 41 percent of those looking for accessories like watches and jewelry.


“If you look at some of the most successful (clothes) companies in the past few years, they are those that have that moat around them,” said hedge fund manager Shawn Kravetz, who runs Esplanade Capital in Boston.


He cites yogawear maker Lululemon and Gap as good examples of how it can help to have clothes that are not sold elsewhere.


If a shopper wants to buy a Banana Republic or Nordstrom shirt from the latest season, they have to buy it either from their stores or online shop.


Discount retailers like Zappos, Amazon and others stock brand-name products, but the merchandise is often not from the current season or limited in colors and sizes.


“I don’t need to see if a television fits my body shape when I buy a TV,” said Joe Megibow, senior vice president of omni-channel e-commerce at American Eagle Outfitters. The teen clothes retailer has seen better sales than its peers over the past year.


“I can get a sense of the TV and I’m good. Clothing is different. Does it fit me, is it my style, do I like the quality of the material and how it is put together. There’s so much more with apparel that matters,” he said.


That is the part of the reason, analysts say, why online-only clothing companies like Bonobos and Gap’s Piperlime have started opening brick-and-mortar stores or tied up with retailers to sell their products in physical locations.


Choice and easy availability are the two most important aspects of shopping, especially during a holiday season that has lost steam after what looked like strong Thanksgiving sales.


Estelle Tran, an “impulsive” shopper in her twenties, agreed.


“If I want to buy books, tech items, DVDs, I would definitely buy online. For clothes, I would rather (visit stores) as it is also a fun experience to try on clothes,” said the Chicago-based finance auditor.


Tran said she would definitely check prices online if she was spending more than $ 100.


Luxury and high-priced items can be more susceptible to showrooming, because pricing is what drives the behavior, said Marshal Cohen, chief economist at the consultancy NPD Group.


“With electronics and certain consumer goods it is very easy to compare specific brands across multiple websites. But (showrooming is) happening and it will be growing. If a (clothes) retailer isn’t taking it seriously, they are going to fall behind,” said Bolette Andersen, principal in KPMG’s retail industry practice.


ROOM TO GROW


Some investors are betting on apparel stocks because of their relative insulation from the threat of showrooming.


While the S&P Apparel Index has returned a sizzling 27.71 percent year to date, according to Reuters data, far outperforming the S&P 500, which is up 14.80 percent, more gains may be coming.


“We still think there’s plenty of room to grow,” said Brian Peery, co-portfolio manager at Hennessy Funds. Its growth fund, heavily weighted in apparel and consumer discretionary goods shares, is up 30 percent over the year.


“As we look into the sector 12-18 months, we continue to buy the discretionary area. Two of our heaviest investments would be Foot Locker Inc and TJX Companies Inc,” he said.


Discount chains like TJX and Ross Stores, which sell branded clothes at low prices, have benefited from the surge in bargain-seeking shoppers.


Even the stocks of retailers like Gap and American Eagle that have staged or are staging turnarounds have gotten a good boost over the year. Gap has soared 69 percent and American Eagle is up 31 percent.


R. Shawn Neville, president of Avery Dennison retail branding and information solutions, said another reason that apparel and to a broader extent other consumer discretionary stocks do well is because of their sustainability.


“In uncertain times, investors look towards market segments that have strong underlying demand which are more stable, like the apparel industry,” Neville said.


Moreover, in times of economic uncertainty, shoppers can still afford clothes and shoes, as opposed to a new car, home, or expensive vacations, helping apparel stocks do well, he said.


“Though Amazon is clearly stealing some share in various categories, clothes retailers, say Abercrombie & Fitch isn’t going anywhere. They’re not being run out of the shopping mall,” said Esplanade’s Kravetz.


(Editing by Jeffrey Benkoe)


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Suicide bombers attack mobile phone firms in Nigeria






KANO, Nigeria (Reuters) – Two suicide car bombers attacked the offices of mobile phone operators India’s Airtel and South Africa’s MTN on Saturday in Nigeria’s northern city of Kano, killing themselves but no civilians, police said.


Islamist sect Boko Haram has previously targeted phone firms, blowing up telephone masts and offices, saying the companies help the security forces catch its members.






“The one who hit the Airtel office was shot by military men before the bomb exploded … at the MTN office the car rammed into the fence but no civilians were killed,” Ibrahim Idris, the chief of police in Kano, told Reuters.


Airtel Nigeria’s parent company Bharti Airtel, India’s top cellphone operator, gave no immediate comment.


The national emergency agency confirmed the bombing and said it was not aware of any civilian casualties. The security forces have played down the death toll in previous bombings.


At least 2,800 people have died in fighting in the largely Muslim north since the sect launched an uprising against the government in 2009, watchdog Human Rights Watch says.


The sect wants to impose strict Islamic law on a country of 160 million people split roughly equally between Christians and Muslims.


The group has previously targeted churches on Christmas Day and security has been increased in all the major northern cities, although security experts say given the scale of Christian worship in Nigeria they cannot protect everyone.


Kano, Nigeria‘s second largest city after the southern commercial-hub Lagos, was the site of Boko Haram’s most lethal attack which killed at least 186 people in January in coordinated bombings and shootings.


(Additional reporting by Isaac Abrak in Kaduna; Writing by Joe Brock; Editing by Andrew Osborn and Janet Lawrence)


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Crafters send mittens with a message to Newtown






Chester Raccoon stood at the edge of the forest and cried. ‘I don’t want to go to school,’ he told his mother. ‘I want to stay home with you. I want to play with my friends. And play with my toys. And read my books. And swing on my swing. Please may I stay home with you?’” — “The Kissing Hand,” by Audrey Penn.


___






NEW YORK (AP) — Imagining the horror for Sandy Hook Elementary students when they walk into their new school for the first time, a Connecticut mom is relying on Chester of the children’s classic “The Kissing Hand” and the busy fingers of her fellow knitters to ease their way.


Kim Piscatelli of East Hampton, Conn., hit on the idea of sending a copy of the book for each of the kids and a pair of handmade mittens adorned with a heart in one palm, signifying the reassuring kiss left there by the mother of scared, sad Chester in the story written by Audrey Penn.


Piscatelli, a 40-minute drive from Newtown, sent out a call to her friends, who called on their friends. The project she thought up just Sunday spread quickly on Facebook and websites for knitters and crafters, with the first shipment of books and mittens scheduled to land in Newtown the first week of January.


“I thought, how are those families ever going to get back in a routine of sending their children to school? If there ever was a town that needed to know about that book, it was Newtown,” said an overwhelmed Piscatelli, who now has a warehouse stacked with 1,600 copies of the book and plenty of volunteers to sort, pack and ship.


Others are hurriedly making mittens, from California and Canada to Florida and the U.S. Virgin Islands, in time for the start of classes in a once-shuttered school in nearby Monroe. A knitters’ group in Georgia pulled an all-night “knitathon” for the cause, Piscatelli said.


The book’s publisher, Tanglewood Press, has donated the books, along with enough copies of a sequel dealing with Chester’s loss of a playmate for teachers to read aloud.


In “The Kissing Hand,” the tearful boy is heading off to school for the first time, but he begs his mother to stay home. She spreads his tiny fingers and kisses him square in the palm and tells him “whenever you feel lonely and need a little loving from home, just press your hand to your cheek and think, ‘Mommy loves you.’”


The story was first published in 1993 by the Child Welfare League of America, a Washington, D.C.-based coalition of agencies and organizations helping children at risk. Penn had tried and failed for years to get her story of Chester published, until a league official heard Penn read it and decided to take it on.


“At first, no bookstore, no wholesaler would carry it,” said Peggy Tierney, who worked at the league and took Penn with her after starting Tanglewood. “Then kindergarten teachers discovered it, word spread, people started going into stores trying to find copies, then everyone started carrying it, and by 1999 it was on the New York Times best-seller list.”


One of Piscatelli’s first stops in getting her mitten project off the ground was to contact Penn, who lives in Durham, N.C. She recalled reading the story to her own three kids when they were younger.


Penn, who lost a brother to drowning when she was 13, signed off on the combined book-mitten project as soon as Piscatelli contacted her.


“When I saw the news, my heart was just torn in half. I couldn’t breathe. I couldn’t breathe. Enough is enough is enough,” the writer said.


Penn’s 2009 sequel, called “Chester the Raccoon and the Acorn Full of Memories,” has Chester the boy raccoon working through the death of a friend, Skiddil Squirrel, who has an accident. Chester’s teacher tells his class Skiddil won’t return to school, so Chester and his mother venture to a butterfly pond where the squirrel loved to play to discover some acorns Skiddil left there have sprouted into young trees.


“I’ve been involved with so many parents who have lost children,” Penn said. “They just seem to reach out to me and say we love your book and your book has been a comfort.”


The writer hopes the children of Sandy Hook will “get a sense of some kind of security” from the mitten project. “They’ll have a way of keeping in tangible touch with someone at home, someone they feel very secure with.”


Meantime, Piscatelli and dozens of knitters who have contacted her through the project’s Facebook page are pressing on to get the books and mittens in the students’ hands. About 600 kids attended Sandy Hook when Lanza opened fire, but Piscatelli plans to share mittens and books with all the schoolchildren of Newtown.


“The original request was for hand-knit mittens with a heart knit in, embroidered on or sewn on,” she said. “The reality is we have people sewing polar fleece mittens, mittens made from recycled sweaters, store-bought mittens. Every pair of handmade or store-bought mittens will have a heart sewn on if it isn’t there when we receive them.”


Piscatelli has heard from other crafters who plan related Kissing Hand projects, including a group of schoolchildren in Mississippi making pillows.


“Everybody wants to help,” she said. “Everybody’s looking for some way to reach out.”


When a company called Oceanhouse Media learned of Piscatelli’s idea they released a digital version of “The Kissing Hand” early and free of cost in the iTunes app store. Piscatelli has also heard from the loved ones of grown-up volunteers on the ground in Newtown.


“I got a call from a woman who said my father is with the Red Cross,” Piscatelli said. “He’s a psychologist and is there now and I really think he needs a pair of Kissing Hand mittens.”


___


Follow Leanne Italie on Twitter at https://twitter.com/litalie


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Kids given healthier snacks eat fewer calories






NEW YORK (Reuters Health) – Kids given a combination of cheese and vegetables will eat only about a quarter as many calories as those given potato chips, according to a new study.


“Like it or not, children like foods that are energy-dense and not those that are nutrient-rich. That is because children are still growing. That is basic physiology,” said Adam Drewnowski, director of the Nutritional Sciences Program at the University of Washington, who was not part of the study.






The findings may not be surprising, but they suggest that swapping out potato chips for cheese or vegetables then might help reduce the amount of calories kids eat at snack time, said Adam Brumberg, one of the authors of the study and the deputy director of the Food and Brand Laboratory at Cornell University.


“If you put into the rotation (healthier snacks) you can have a significant impact on weekly caloric intake,” he suggested.


The study, which was funded in part by the cheese maker Bel Brands USA, involved 183 kids in 3rd through 6th grade.


Each of the kids was put in a room to watch TV and eat a snack – 45 kids were given potato chips, 36 were offered cheese, 59 were given raw vegetables and 43 were given cheese and vegetables.


After 45 minutes the researchers measured how much food the children had eaten.


They found that kids in the chip group ate by far the most calories – 620 on average.


Kids ate 200 calories of cheese, 60 calories of vegetables and 170 calories of the combination cheese-and-vegetables snack.


“Children tend to eat the foods they like – and one measure of preference is the amount eaten. So chips and cheese beat raw vegetables hands down. Why am I not surprised?” said Drewnowski in an email to Reuters Health.


The findings might be obvious, but they also reveal that kids felt full after eating fewer calories of the cheese and vegetables than after eating the potato chips.


“One thing that was crucial about this study is there was no restriction on the quantity. No one in the snacking conditions ate everything,” said Brumberg.


In other words, the kids ate until they felt full, and for the potato chip group that meant eating a lot more calories than the cheese-and-veggies group.


To put those 600 potato chip calories into perspective, a moderately active eight-year-old boy should eat about 1400 to 1600 calories a day, according to the U.S. Department of Agriculture.


ROLE OF RESTRICTION?


Brumberg said there’s a lot of conflicting information regarding nutrition and ways to get kids to eat healthy, but restricting kids’ diets to only the healthiest of foods might not be the right approach.


“We think that for most people restrictions are setting up an opportunity for you to fail,” he said.


For some families, restricting snacks to only the healthiest ones is not even possible.


Drewnowski pointed out that children from low income families are affected the most by obesity, and “red bell peppers at $ 3.99 per pound are not going to solve that problem.”


Brumberg suggested that parents should still let kids have the foods they prefer, but limit them.


“The most effective way, we believe, is to put (healthy snacks) in the rotation. Don’t take away everything that they love, but reduce calories over the week,” he said.


SOURCE: http://bit.ly/ZVutRp Pediatrics, online December 17, 2012.


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Hurting Spaniards pin hopes on Christmas lottery






MADRID (AP) — After another brutal year of economic hardship, Spaniards across the country are hoping for relief when the country’s famed Christmas lottery — the world’s richest — pays out €2.5 billion ($ 3.3 billion) in tax-free awards on Saturday.


Almost everyone in the country of 46 million people will be glued to live TV to watch school children sing out the winning numbers for the lottery that pays out maximum prizes of €400,000 ($ 529,840) and many more for smaller amounts. The top prize is dubbed “El Gordo” (“The Fat One”) and is likely to be won by hundreds if not thousands of players.






Unlike other big lotteries that generate just a few big winners, Spain‘s lottery — now in its 200th year — has always aimed for a share-the-wealth-system rather than a single jackpot, and thousands of numbers yield at least some kind of return.


The Christmas lottery is so popular that there are frequently three €20 ($ 26) tickets sold for every Spaniard, and the lottery itself is the unofficial kickoff of the holiday season.


“A lot of people win,” said Pablo Foncillas, a marketing professor at the IESE Business School in Madrid. “It’s really common even if you don’t win to get a free ticket. So many people win that people just keep on playing. Everyone knows someone who’s won, even if it’s only a little bit.”


Hundreds of players lined up daily to buy tickets this week outside the Dona Manuelita lottery store in Madrid, which has often sold winning tickets. Before Spain’s property-led economic boom collapsed in 2008, they had hoped to win so they could buy a small apartment or a car. Now people said they need the money just to hang on to what they have and avoid being evicted or having cars repossessed.


Betting that tickets from Dona Manuelita stood a better chance of winning, unemployed construction company office manager Miguel Angel Ruiz drove 165 kilometers (102 miles) to buy for a pool of players including his wife and relatives.


“We’re buying more hoping we’ll hit it so we can emerge from poverty,” said Ruiz, 39. “Before the crisis, lottery winnings were to buy an apartment or a car, and now it’s to pay debts.”


Diego Sanbrano, let go from his waiter’s job two months ago, said the Spanish lottery isn’t about getting rich and never working again.


“It’s to pay off debts and straighten out your life,” he said. “You pay the mortgage and make the car payment, and then maybe you have a little left over to go somewhere on vacation.”


Since so many people chip in to buy tickets in groups, the top prizes frequently end up being handed out in the same small town or in one city neighborhood. Last year’s top winning number hit for 1,800 tickets in the northern town of Granen, population 2,000. Townspeople shared about €700 million ($ 925 million), and the rest of the €1.8 billion ($ 2.4 billion) was doled out in smaller prizes around Spain.


The Dec. 22 lottery began in 1812 and last year sold an estimated €2.7 billion ($ 3.6 billion) in tickets with per-capita spending of about €70 ($ 92) just for the Christmas lottery.


Spain holds another big lottery Jan. 6 to mark the Feast of the Epiphany. It is known as “El Nino” (The Child), in reference to the baby Jesus.


But the crisis will hit El Nino and all lotteries going forward. Until now, lottery winnings have been free from taxation. Waves of austerity measures imposed by the government this year to prevent Spain from asking for public finances bailout like those for Greece, Ireland and Portugal have translated into higher taxes. Lottery winnings above €2,000 ($ 2,640) will face a 20 percent tax in 2013.


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Kenya police: 28 people killed in clashes






NAIROBI, Kenya (AP) — A police official says 28 people have been killed in clashes between farmers and herders in south-eastern Kenya.


Anthony Kamitu, who is leading police operations to prevent the attacks, said Friday that the Pokomo tribe of farmers raided a village of the Orma herding community, called Kipao, at dawn in the Tana River Delta.






The latest deaths in a tit-for-tat cycle of killings may be related to a redrawing of political boundaries and next year’s general elections, according to the U.N.


At least 110 people were killed in clashes between the Pokomo and Orma in September and October.


Animosity between the two communities over land and water resources has existed for decades.


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Facebook tests $1 fee for messages to non-friends






SAN FRANCISCO (AP) — Facebook says it is testing a service that will charge users $ 1 to guarantee that messages they send to people they are not connected to arrive in users’ inboxes, rather than in an often-ignored folder called “other.”


Launched in 2011, the “other” folder is where Facebook routes messages it deems less relevant. Not quite spam, these include messages from people you most likely don’t know, based on Facebook’s reading of your social connections. Many users ignore this folder.






Now, users will be able to pay $ 1 to route their messages to non-friends. Facebook said Thursday that it is testing the service with a small percentage of individuals — not businesses — in the U.S.


“For example, if you want to send a message to someone you heard speak at an event but are not friends with, or if you want to message someone about a job opportunity, you can use this feature to reach their Inbox,” Facebook said in an online post. “For the receiver, this test allows them to hear from people who have an important message to send them.”


The company says charging for messages could help discourage spammers.


In October, Facebook unveiled another feature that lets users pay if they want more people to read their updates. For $ 7, users can promote a post to their friends, just as advertisers do.


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Martha Raddatz, Hot Off Debate Performance, Promoted at ABC News






NEW YORK (TheWrap.com) – Martha Raddatz, widely praised for her moderation of the vice presidential debate in October, has been given an expanded role as ABC News’ chief global affairs correspondent. Jonathan Karl, meanwhile, will become the network’s new chief White House correspondent, filling the void left by Jake Tapper‘s exit to CNN.


Raddatz will replace Tapper as the primary substitute for George Stephanopoulos on “This Week” and will contribute regularly to the Sunday morning show’s roundtable. Karl will also serve as a substitute and regularly appear on the roundtable.






Tapper departed ABC in part because he has long been interested in hosting “This Week” full-time, but Stephanopoulos has no plans to give up the hosting job, a person familiar with the situation told TheWrap.


ABC News President Ben Sherwood announced the new assignments for Raddatz and Karl on Thursday, soon after CNN announced Tapper’s hiring.


Karl has investigated wasteful federal spending, covered elections, and served as the network’s senior national security correspondent.


Raddatz has reported from the Pentagon, the State Department, the White House, and from conflict zones worldwide, including Afghanistan and Iraq.


But she has been perhaps most celebrated for keeping the vice presidential debate between Joe Biden and Paul Ryan on course after the moderator of the first presidential debate, Jim Lehrer, was accused of letting the candidates run amok.


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AP IMPACT: Big Pharma cashes in on HGH abuse






A federal crackdown on illicit foreign supplies of human growth hormone has failed to stop rampant misuse, and instead has driven record sales of the drug by some of the world’s biggest pharmaceutical companies, an Associated Press investigation shows.


The crackdown, which began in 2006, reduced the illegal flow of unregulated supplies from China, India and Mexico.






But since then, Big Pharma has been satisfying the steady desires of U.S. users and abusers, including many who take the drug in the false hope of delaying the effects of aging.


From 2005 to 2011, inflation-adjusted sales of HGH were up 69 percent, according to an AP analysis of pharmaceutical company data collected by the research firm IMS Health. Sales of the average prescription drug rose just 12 percent in that same period.


___


EDITOR’S NOTE — Whether for athletics or age, Americans from teenagers to baby boomers are trying to get an edge by illegally using anabolic steroids and human growth hormone, despite well-documented risks. This is the second of a two-part series.


___


Unlike other prescription drugs, HGH may be prescribed only for specific uses. U.S. sales are limited by law to treat a rare growth defect in children and a handful of uncommon conditions like short bowel syndrome or Prader-Willi syndrome, a congenital disease that causes reduced muscle tone and a lack of hormones in sex glands.


The AP analysis, supplemented by interviews with experts, shows too many sales and too many prescriptions for the number of people known to be suffering from those ailments. At least half of last year’s sales likely went to patients not legally allowed to get the drug. And U.S. pharmacies processed nearly double the expected number of prescriptions.


Peddled as an elixir of life capable of turning middle-aged bodies into lean machines, HGH — a synthesized form of the growth hormone made naturally by the human pituitary gland — winds up in the eager hands of affluent, aging users who hope to slow or even reverse the aging process.


Experts say these folks don’t need the drug, and may be harmed by it. The supposed fountain-of-youth medicine can cause enlargement of breast tissue, carpal tunnel syndrome and swelling of hands and feet. Ironically, it also can contribute to aging ailments like heart disease and Type 2 diabetes.


Others in the medical establishment also are taking a fat piece of the profits — doctors who fudge prescriptions, as well as pharmacists and distributors who are content to look the other way. HGH also is sold directly without prescriptions, as new-age snake oil, to patients at anti-aging clinics that operate more like automated drug mills.


Years of raids, sports scandals and media attention haven’t stopped major drugmakers from selling a whopping $ 1.4 billion worth of HGH in the U.S. last year. That’s more than industry-wide annual gross sales for penicillin or prescription allergy medicine. Anti-aging HGH regimens vary greatly, with a yearly cost typically ranging from $ 6,000 to $ 12,000 for three to six self-injections per week.


Across the U.S., the medication is often dispensed through prescriptions based on improper diagnoses, carefully crafted to exploit wiggle room in the law restricting use of HGH, the AP found.


HGH is often promoted on the Internet with the same kind of before-and-after photos found in miracle diet ads, along with wildly hyped claims of rapid muscle growth, loss of fat, greater vigor, and other exaggerated benefits to adults far beyond their physical prime. Sales also are driven by the personal endorsement of celebrities such as actress Suzanne Somers.


Pharmacies that once risked prosecution for using unauthorized, foreign HGH — improperly labeled as raw pharmaceutical ingredients and smuggled across the border — now simply dispense name brands, often for the same banned uses. And usually with impunity.


Eight companies have been granted permission to market HGH by the U.S. Food and Drug Administration, which reviews the benefits and risks of new drug products. By contrast, three companies are approved for the diabetes drug insulin.


The No. 1 maker, Roche subsidiary Genentech, had nearly $ 400 million in HGH sales in the U.S. last year, up an inflation-adjusted two-thirds from 2005. Pfizer and Eli Lilly were second and third with $ 300 million and $ 220 million in sales, respectively, according to IMS Health. Pfizer now gets more revenue from its HGH brand, Genotropin, than from Zoloft, its well-known depression medicine that lost patent protection.


On their face, the numbers make no sense to the recognized hormone doctors known as endocrinologists who provide legitimate HGH treatment to a small number of patients.


Endocrinologists estimate there are fewer than 45,000 U.S. patients who might legitimately take HGH. They would be expected to use roughly 180,000 prescriptions or refills each year, given that typical patients get three months’ worth of HGH at a time, according to doctors and distributors.


Yet U.S. pharmacies last year supplied almost twice that much HGH — 340,000 orders — according to AP’s analysis of IMS Health data.


While doctors say more than 90 percent of legitimate patients are children with stunted growth, 40 percent of 442 U.S. side-effect cases tied to HGH over the last year involved people age 18 or older, according to an AP analysis of FDA data. The average adult’s age in those cases was 53, far beyond the prime age for sports. The oldest patients were in their 80s.


Some of these medical records even give explicit hints of use to combat aging, justifying treatment with reasons like fatigue, bone thinning and “off-label,” which means treatment of an unapproved condition. In other cases, the drug was used “for an unknown indication,” meaning that the reason for treatment wasn’t clear.


Even Medicare, the government health program for older Americans, allowed 22,169 HGH prescriptions in 2010, a five-year increase of 78 percent, according to data released by the Centers for Medicare and Medicaid Services in response to an AP public records request. And nearly half the increase came in one year: 2007.


“There’s no question: a lot gets out,” said hormone specialist Dr. Mark Molitch of Northwestern University, who helped write medical standards meant to limit HGH treatment to legitimate patients.


And those figures don’t include HGH sold directly by doctors without prescriptions at scores of anti-aging medical practices and clinics around the country. Those numbers could only be tallied by drug makers, who have declined to say how many patients they supply and for what conditions.


The AP approached every U.S.-authorized manufacturer to ask what efforts they make to market responsibly and prevent abuse. Only one HGH supplier, Novo Nordisk, agreed to an interview.


“We’re doing our level best to make sure that the right patients are getting the right medicine at the right time,” said company spokesman Ken Inchausti.


He said the company is aware of the abuse issue. He said if patients apply for assistance from the company’s patient-support hub, prescriptions will be flagged for review if they are missing the most rigorous test or an endocrinologist’s signature. He said the company won’t sell HGH directly to doctors accused of bad practices and does not deal with anti-aging clinics.


Representatives of other FDA-approved HGH makers insist they do not encourage use by bodybuilders or athletes or wealthy baby boomers trying to recapture their youth. But some said they are largely powerless to control who uses their medications or why.


“Lilly cannot restrict the actions of distributors, pharmacies or doctors,” Eli Lilly spokeswoman Kelley Murphy said in a written statement.


That argument doesn’t fly for critics like Dr. Peter Rost, a retired Pfizer executive who filed a whistleblower lawsuit over the HGH marketing practices of Pharmacia, which later merged with Pfizer. He said drug companies are simply looking the other way and betting that their profits will eclipse the cost of any fines.


They view it as “good business,” he said.


___


PEDDLED ON INTERNET


Type “human growth hormone” into any Internet search engine, and it will spit back countless websites with overblown promises of smoother skin, better sex, weight loss and even renewed body organs.


Any doctor who actually prescribes the drug for those purposes is taking a legal risk.


FDA regulations ban the sale of HGH as an anti-aging drug. In fact, since 1990, prescribing it for things like weight loss and strength conditioning has been punishable by 5 to 10 years in prison.


Such marketing claims are routinely made at hormone clinics like Palm Beach Life Extension, whose owners are among 13 people now awaiting trial on federal charges in Florida in a steroids and HGH distribution case brought last year.


“Grow YOUNG with Us!” screamed a banner on the company’s now-defunct website, which advertised that HGH can reduce body fat, improve vision, strengthen the immune system, aid kidney function, lower blood pressure and enhance memory and mood.


The clinic arranged to have its clients’ prescriptions filled at Treasure Coast Pharmacy, in Jensen Beach, Fla.


In 2009, the FBI recorded a phone call between the pharmacy’s owner, Peter Del Toro, and a doctor in Elkton, Md., who was cooperating with agents after being implicated in a related steroid-distribution case.


Their talk, documented in a court filing, illustrates how things often work in the networks of pharmacies and clinics that drive HGH sales.


Patients submitted a medical history form by mail and took a blood test. But in most instances, the indictment said, the evaluation was a sham: One doctor was charged with giving a clinic a pad of blank, signed prescriptions to save him the chore of signing off on each diagnosis. He got $ 50 for every drug order bearing his name, the indictment said.


Dr. Rodney Baltazar, the Maryland physician cooperating with the FBI, sometimes consulted briefly with patients via webcam. But he made it clear in the call that those evaluations were perfunctory at best.


Baltazar was a gynecologist, not an endocrinologist. He said he knew “a little bit” about HGH and testosterone, which are often prescribed in tandem, but he relied largely on clinic salespeople to set doses.


The pharmacist coached the doctor: Keep detailed medical charts documenting that patients are taking the drug for at least some kind of health problem, just in case the U.S. Drug Enforcement Administration ever came calling.


“Because somebody questions you, you want to be able to say, ‘Here, look at his chart. You know, he’s got fatigue. He’s got, you know, a decreased sex drive. He’s got increased body fat. He has some — some slight depression, probably.’ Whatever his signs and symptoms are.”


None of these conditions is a legal reason to prescribe HGH. But the pharmacist said that most investigators will be satisfied and move on “because there’s guys that are just selling stuff basically like a boiler room.”


Del Toro was arrested along with 12 other people in September 2011 on charges that they distributed steroids and human growth hormone to people who had no legitimate medical need. He is awaiting trial. His lawyer declined to comment. Baltazar was sentenced to six months in prison for involvement in steroid distribution schemes.


At the height of the crackdown in 2007, the federal government went after Pfizer in a case involving anti-aging clinics. The company paid $ 34.7 million in fines to settle the case — 11 percent of the company’s annual revenue from the drug.


___


TROUBLED HISTORY


Blockbuster U.S. sales of HGH represent the latest frustration in 25 years of government efforts to control abuse of the growth drug made infamous by sports scandals.


First marketed in 1985 for children with stunted growth, HGH was soon misappropriated by adults intent on exploiting its modest muscle- and bone-building qualities. Congress limited HGH distribution to the handful of rare conditions in an extraordinary 1990 law, overriding the generally unrestricted right of doctors to prescribe medicines as they see fit.


Despite the law, illicit HGH spread around the sports world in the 1990s, making deep inroads into bodybuilding, college athletics, and professional leagues from baseball to cycling. The even larger banned market among older adults has flourished more recently.


For years, cheaper supplies from unauthorized foreign factories, particularly in China, fed the market via direct and Internet sales that sidestepped the medical establishment.


Though such shipments were banned under other law, the imports initially attracted little attention because they were usually labeled as raw pharmaceutical ingredients, which compounding pharmacies are allowed to bring into the country.


That flow began to be curtailed in 2006, when U.S. drug authorities stepped up efforts to block shipments at the border.


A handful of pharmacies across the country were hit with criminal charges over their handling of HGH. Federal prosecutors charged China’s biggest HGH maker, GeneScience Pharmaceutical, with illegally distributing its Jintropin brand in the U.S. The company’s CEO pleaded guilty in 2010.


With illicit supplies crimped, many pharmacies stopped selling unauthorized HGH. But tens of thousands of adult abusers began buying pricey U.S.-approved HGH that remained available in abundant supply, the AP found in its analysis of sales data.


Thus, pushed by a powerful demand, sales of U.S.-approved brands have swelled far beyond expected levels for a drug approved in just a handful of rare conditions.


Dr. Robert Marcus, a retired hormone specialist who left HGH manufacturer Eli Lilly and Co. in 2008, said that company was bent on stopping foreign counterfeits, not on cutting off abusers. “That’s where their major level of frustration was — pharmaceutical fraud — rather than focusing on people who were using growth hormone illegitimately,” he said.


Dr. Jim Meehan, of Tulsa, Okla., who has used HGH to treat aging problems and sports injuries, said the federal clampdown “never seemed to affect my patients and their ability to get Omnitrope, Tev-Tropin” and other government-approved brands.


The big drug companies have applauded the foreign crackdown and urged the government to do even more to combat sales of fake or fraudulently labeled HGH. In 2004, Bruce Kuhlik, speaking for the Pharmaceutical Research and Manufacturers of America, told a federal task force that unauthorized drug importation “is inherently unsafe” and industry representatives used Chinese HGH imports as their poster child.


In 2007, as the HGH embargo gained momentum, authorized makers picked up 41 percent more HGH orders, raising their annual total from 245,000 to 345,000, according to the analysis of the IMS Health data. Similarly, most of the drug’s sales boom happened in the first two years of the crackdown, with 46 percent inflation-adjusted growth in yearly sales to $ 1.1 billion.


Steve Kleppe, of Scottsdale, Ariz., a restaurant entrepreneur who has taken HGH for almost 15 years to keep feeling young, said he noticed a price jump of about 25 percent after the block on imports. He now buys HGH directly from a doctor at an annual cost of about $ 8,000 for himself and the same amount for his wife.


Despite higher prices, the business has expanded in recent years largely on the strength of sales to healthy adults who can afford to indulge their hope of retaining youthful vigor.


___


GROWING OLD


Many older patients go for HGH treatment to scores of anti-aging practices and clinics heavily concentrated in retirement states like Florida, Nevada, Arizona and California.


These sites are affiliated with hundreds of doctors who are rarely endocrinologists. Instead, many tout certification by the American Board of Anti-Aging and Regenerative Medicine, though the medical establishment does not recognize the group’s bona fides.


The clinics offer personalized programs of “age management” to business executives, affluent retirees, and other patients of means, sometimes coupled with the amenities of a vacation resort.


The clinics insist there are few, if any, side effects from HGH. Mainstream medical authorities say otherwise.


A 2007 review of 31 medical studies showed swelling in half of HGH patients, with joint pain or diabetes in more than a fifth. A French study of about 7,000 people who took HGH as children found a 30 percent higher risk of death from causes like bone tumors and stroke, stirring a health advisory from U.S. authorities.


For proof that the drug works, marketers turn to images like the memorable one of pot-bellied septuagenarian Dr. Jeffry Life, supposedly transformed into a ripped hulk of himself by his own program available at the upscale Las Vegas-based Cenegenics Elite Health. (He declined to be interviewed.)


These promoters of HGH say there is a connection between the drop-off in growth hormone levels through adulthood and the physical decline that begins in late middle age. Replace the hormone, they say, and the aging process slows.


“It’s an easy ruse. People equate hormones with youth,” said Dr. Tom Perls, a leading industry critic who does aging research at Boston University. “It’s a marketing dream come true.”


Some scientific studies of HGH have found modest benefits: some muscle and bone building, as well as limited fat loss, but nothing like the claims of the anti-aging industry. And some of the value credited to HGH may instead come from testosterone, which is routinely provided with HGH by anti-aging doctors and sports suppliers.


Endocrinologists say it’s natural for the body to produce less growth hormone as people age beyond their early 20s, because they aren’t growing anymore. Only a tiny number of adults with extraordinarily low HGH levels — perhaps several thousand of them — are believed to suffer real deficiencies that can properly be treated with the hormone.


Still, anti-aging doctors routinely diagnose otherwise healthy middle-aged people with an HGH deficiency, simply because their levels are lower than in young adults. “Basically anyone going through midlife,” can benefit from the drug, declared one prescriber, Dr. Howard Elkin, of Whittier, Calif., who has himself competed as a bodybuilder.


Dr. Kenneth Knott, of Marietta, Ga., said HGH helps his older patients feel “more vibrant” and look “more alive.”


Like many anti-aging doctors, he diagnoses patients by testing for a blood component called insulin growth factor, which is indirectly tied to HGH. Endocrinologists use a more authoritative test that stimulates the pituitary gland to make HGH itself. Nearly all insurers insist on this stimulation testing, and that’s why clinic patients almost always pay for HGH out of their own pockets.


Bob Vitols, a 50-year-old lab assistant at a veterinary medicine company in Lincoln, Neb., is a rare exception. His unusually generous health plan isn’t allowed to challenge a doctor’s prescription.


Four years ago, Vitols began feeling run down. So he Googled his symptoms on the Internet, decided he had a hormone deficiency, and sought out a clinic.


One doctor put him on testosterone replacement therapy. A second clinic added HGH after diagnosing him with osteopenia, a mild bone thinning common in aging adults. It is not, however, a condition that can properly be treated with HGH.


Despite the diagnosis, the treatments — which can cost $ 10,000 per year — have been covered by his health insurance, he said. He takes Genotropin, the HGH made by Pfizer. His prescriptions are filled via mail order by CVS Caremark Corp., one of the largest dispensers of prescription drugs in the U.S.


Vitols said the drug changed his life: his mood is better, and he isn’t burning out every day at 2 p.m. “I feel like I could walk outside and just walk through a fence — and come out fine on the other side,” he said.


His experiences with the drug haven’t all been positive, though. Vitols said he initially developed elevated liver enzymes and went to a specialist, who told him to stop taking hormones immediately.


Instead, Vitols said, he adjusted his dosage, and the problem disappeared.


He also dumped the specialist:


“I could tell he was against hormones right at the start,” Vitols said.


___


Associated Press Writer David Caruso reported from New York and AP National Writer Jeff Donn reported from Plymouth, Mass. AP Writer Troy Thibodeaux provided data analysis assistance from New Orleans.


___


AP’s interactive on the HGH investigation: http://hosted.ap.org/interactives/2012/hgh


___


The AP National Investigative Team can be reached at investigate(at)ap.org


EDITOR’S NOTE _ Whether for athletics or age, Americans from teenagers to baby boomers are trying to get an edge by illegally using anabolic steroids and human growth hormone, despite well-documented risks. This is the second of a two-part series.


Health News Headlines – Yahoo! News





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Call for tougher banking reforms







Government plans to ring-fence the banks – trying to protect retail banking from the riskier investment side – “fall well short of what is required”, a report has warned.






The Parliamentary Commission on Banking Standards wants the government to “electrify” the fence so banks cannot make holes in it.


The government’s bank reforms will go before Parliament early next year.


The Treasury said it was committed to reforming the banking sector.


Vickers recommendations


The Parliamentary Commission on Banking Standards, known as the Banking Commission for short, was asked by Chancellor George Osborne to study the draft version of the government’s Financial Services (Banking Reform) Bill.


This follows last year’s recommendation by the Independent Commission on Banking, which was led by Sir John Vickers.


Sir John concluded that ring-fencing was the best way to protect “core” retail banking activities from any future investment banking losses, such as were seen during the global financial crisis.


The government’s proposed bill also spells out rules to protect depositors and prevent the use of taxpayer money for bailouts, thereby curtailing banks’ perception they are “too big to fail”.


Continue reading the main story



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The bill hinges on three main aspects:


  • ring-fencing or protecting retail banking

  • ensuring that bank losses fall on bank creditors and not depositors or taxpayers

  • making banks better able to absorb losses

Ring-fencing would ensure that retail services of a struggling lender can be carried on independently and smoothly even if authorities let the rest of the group fail.


For example, in the case of a failing banking group, regulators could sell off its core activities – thereby maintaining continuity for depositors – while allowing the rest of the organisation to go through a bankruptcy process.


Secondly, the proposed bill wants to rank retail deposits (but not pension liabilities) ahead of the claims of other bank creditors in the event of a bank insolvency.


Thirdly, banks are to hold a sufficient capital buffer – as outlined by global regulators – which means that if banks do fail, losses can be absorbed by shareholders and other creditors rather than the taxpayer.


“Electrification”


Under the draft legislation, the Treasury would have the authority to decide which banks ring-fencing should apply to, as well as specific activities to be undertaken, within ring-fenced banks.


The Prudential Regulation Authority, which will become the UK’s regulator for deposit-taking institutions in April under the Bank of England, would have the power to ensure the ring-fenced bank to carry on with its business.


But there has been much debate over whether to enforce a full separation between retail and investment activities – that is, a break-up. The recommendation by Sir John stopped short of such action.


Andrew Tyrie, chairman of the Banking Commission, said that the “electrification” of the ring fence should include the regulator being able to force the full separation of a bank’s retail and investment divisions, if the lender was found to be trying to break the fence.


“The proposals as they stand [in the Bill], fall well short of what is required,” he said.


“Over time, the ring-fence will be tested and challenged by the banks. Politicians too could succumb to lobbying from banks and others, adding to pressure to put holes in the ring-fence.”


Continue reading the main story
  • The Parliamentary Commission on Banking Standards was appointed in July following the Libor scandal and other episodes that damaged the reputation of banks in the UK

  • It includes MPs and peers and is chaired by Andrew Tyrie, who also heads the House of Commons’ Treasury Committee

  • Members include the next Archbishop of Canterbury, Justin Welby

  • It heard evidence from major figures in the banking sector

  • Evidence included a warning from RBS boss Stephen Hester that ring-fencing banks’ retail and investment arms could increase the risk of institutions needing to be rescued

  • But Barclays chief executive Antony Jenkins told the commission that his bank was “embracing” the ring-fencing proposal

  • The commission has also heard from Paul Volcker, a former chairman of the US Federal Reserve, about his US proposals to ensure bank safety


He added: “For the ring-fence to succeed, banks need to be discouraged from gaming the rules. All history tells us they will do this unless incentivised not to.”


“That is why we recommend electrification. The legislation needs to set out a reserve power for separation – the regulator needs to know he can use it.”


Anthony Browne, the chief executive of the British Bankers’ Association (BBA), welcomed the report, but warned that uncertainty over banks’ prospects could have a negative impact on their ability to lend.


“The risk here is creating uncertainty. If it’s perpetually hanging over the banking sector that individual banks or the whole sector could be broken up at some point, then it’s going to be difficult to return to having an investable banking sector that can be customer-focused and globally competitive and do what it should be doing, which is lending to homeowners and businesses,” he said.


Ed Balls, Labour’s shadow chancellor said: “As Ed Miliband and I said at the Labour conference this year, if the letter and spirit of the Vickers proposals are not delivered and we do not see cultural change in our banks, full separation will be necessary.


“The Commission is clearly right to say the jury is still out and to demand a reserve power for full separation of the banks.”


‘Consensus commitment’



The Commission’s report comes a month after Mr Osborne urged its members not to send the government’s proposed reform “back to square one” by “unpicking” the consensus on how it should be carried out.


A Treasury spokesman said on Thursday evening: “The government is committed to reforming the financial sector and putting in place a regulatory structure that learns the lessons of the past and protects taxpayers in the future.”


“It has been committed to building consensus and has consulted widely on these reforms over the last two and half years. The Banking Reform Bill is the next step in that.


“The government is grateful to the Parliamentary Commission on Banking Standards for its scrutiny of the draft bill and notes that it, ‘welcomes the government’s action to bring forward legislation to implement a ring-fence’.”


The spokesman added that the government would study the report and respond in detail when the Financial Services (Banking Reform) Bill is formally introduced to Parliament early next year.


BBC News – Business





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