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GDP growth slows in final quarter

Compiled from wire reports

The economy finished 2004 with its best performance in five years despite slowing in the final stretch. The outlook ahead: a moderate jog, rather than a sprint.

The broadest barometer of the country’s economic standing, the gross domestic product, clocked a 4.4 percent increase for all of last year spurred by brisk consumer and business spending, the Commerce Department reported Friday.

The latest snapshot of GDP, which measures the value of all goods and services produced within the United States, exceeded the 3 percent registered in 2003 and marked the strongest showing since the 4.5 percent gain of 1999.

To be sure, it wasn’t all smooth sailing. In the October-to-December quarter, the economy grew at a 3.1 percent annual rate, its most sluggish pace since the first quarter of 2003. In the third quarter, the economy expanded at a 4 percent rate.

Although economists had expected a 3.5 percent growth rate in the fourth quarter, they said its 3.1 percent performance was still respectable and not as weak as the number suggested.

The deceleration seen in the fourth quarter from the previous quarter mostly reflected a drag on growth from the nation’s swollen trade deficit. That shaved a sizable 1.73 percentage points off of fourth-quarter GDP.

Consumers and businesses, however, showed a relatively hearty appetite to spend during the final quarter even as energy prices soared. “Households and businesses went hog wild at the end of the year,” said Joel Naroff, president of Naroff Economic Advisors.

Merck denied patent extension on Fosamax

Trenton, N.J. A federal court invalidated the patent for a blockbuster osteoporosis drug made by Merck & Co. on Friday, sending Merck shares plunging but offering patients with the brittle-bone disease the possibility of cheaper pills in a few years.

The U.S. Court of Appeals for the Federal Circuit in Washington, D.C., invalidated the patent for the once-a-week version of Merck’s Fosamax, which dominates the market for osteoporosis drugs. Under the ruling, generic competition could begin as soon as early 2008, instead of 2018.

Fosamax is the No. 2 drug for Whitehouse Station-based Merck. The company already is beleaguered by its voluntary withdrawal of arthritis blockbuster Vioxx, which is expected to cost the company billions of dollars to settle lawsuits by patients claiming it caused heart attacks, strokes and other serious medical problems.

Merck reported total sales of $3.16 billion for Fosamax last year, more than 90 percent of which were for the once-a-week version, according to company spokesman Tony Plohoros.

Lockheed to build presidential helicopters

Washington Top Pentagon contractor Lockheed Martin Corp. will build the new presidential helicopter fleet, members of Congress said Friday, putting an end to a fierce competition that had both political and international overtones.

The Navy was to make the official announcement later Friday. New York and Connecticut lawmakers confirmed the award.

The $1.6 billion contract to buy 23 high-tech, high-security aircraft is comparatively small. But it is emblematic of two important issues: the outsourcing of American jobs and the question of how open the U.S. military market is to foreign contractors.

The decision was a victory for the major campaign waged by Maryland-based Lockheed and its European partners, with the help of political leaders from England and Italy.

It was a blow to Connecticut-based Sikorsky Aircraft Corp., which has built the presidential fleet since 1957.

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