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HERE COMES ’08, THE WORST YEAR EVER
HALLOWEEN ENDED last Wednesday night, but IMS Health carried on scaring the drugbiz by issuing their 2008 Global Pharmaceutical Market and Therapy Forecast. Among the bad news: stateside sales growth will hit a historic low next year, and two-thirds of all US scrips issued will be for generics. Meanwhile, Japanese growth may slow to one or two points, down by as much as 75 per cent from this year’s pace. Let’s see, what else could happen? Patent expiries will occur on brands worth $20 billion, and regulators are, in the words of the report, “slowing, and in some cases halting, the introduction of new medicines.” That’s not it. We’re also facing “compulsory licensing by nations, court rulings on composition of matter and process patents, granting of patents in India, enforcement of IP rights in China, and reform of patent laws in the U.S. and Europe.” Says IMS’s Murray Aitkin: “The actions being taken by [pharma] companies to reinvent themselves will need to continue at an accelerated pace.” What actions might those be, Murray, other than the obvious one of training for an exciting new career as a pet-walker?
BUY YOUR WAY OUT OF TROUBLE?
THE USUAL DRUGBIZ RESPONSE to discouraging news (see previous item) is to retreat into idle speculation concerning who may be about to buy whom. Analysts last week handicapped several acquisition candidates, leading with sufferin’ Sepracor (see next item.) Sep just signed a co-marketing deal with GlaxoSmithKline, prompting observers to wonder if wedding bells may be in the future. Sep’s current market value is a shade under $3 billion, uncharitably described by the Motley Fool web site as “chump change” for GSK or Schering-Plough. Eyes are also on Shire, which as a mid-tier outfit with a $13.7 billion market cap, could be either a buyer or a takeover targer. Some company-watchers think Shire may be interested in Noven Pharmaceuticals, which has an ADHD Rx in the pipeline.
THEY LIKE YOU, DOC, BUT THEY LOVE HIM
DR. ROBERT JARVIK arguably may be the world’s most eminent cardiologist, but he’s been pushed aside by an animatronic beaver. Dr. Jarvik, who shills for atorvastatin (Lipitor, Pfizer), finished sixth in a competition ranking viewer recall of direct-to-consumer pharma advertising on television. He placed behind a surreal campaign for sleep disorder Tx ramelteon (Rozerem, Takeda.) The Rozerem ads, which feature the beaver in bickering dialogue with former US president Abraham Lincoln, have been lauded for their creativity, which reinforces the theme, “Your dreams miss you.” However, Rozerem scrips have lagged in the insomnia category behind eszopiclone (Lunesta, Sepracor.) Therefore, it figures that Lunesta emerged as the most memorable campaign of all, with its ads finishing both first and second in data compiled by IAG Research. Rounding out the list are a pair of anti-allergy Txs: in third place, cetirizine (Zyrtec, Pfizer), followed by Rx mometasone (Nasonex, Schering-Plough.)
READ ’EM AND WEEP
THE PHRASE “drowning in paperwork” is outmoded in the Blackberry age, but the sentiment remains the same. A new report by a North Carolina think-tank suggests that nearly a third of the time drug reps spend inputting and reading internal company communications probably isn’t necessary, and results in an estimated $309,000 in lost sales per rep each year. The research by Best Practices LLC also reveals district sales managers claim they spend a mind-roasting 36.5 hours per week managing internal communication. Helpful tip from the researchers: Try flagging e-mail messages with a subject line clarifying whether the information is essential or merely nice-to-know.
DO-IT-YOURSELF HEAD REMOVER
UNLIKE, SAY, FORMER PFIZER BOSS Hank McKinnell, retiring GlaxoSmithKline kingpin J.P. Garnier seems determined not to ride out his term and leave it to his successor to address the company’s problems. Garnier last week said he would oversee “Operation Excellence,” which basically consists of taking an ax to GSK’s overhead in an effort to save $1.4 billion in annual costs by 2010. Expected are plant closures and staff cuts, particularly among the company’s 24,000-member field force. The Sunday Times of London reports GSK has experimented with smaller sales teams and determined that individual bag-carriers can increase their average of $2 million in annual sales if the herd is thinned, at no increase to the $200,000 per that it takes to feed and care for each rep. Give Garn credit for undertaking an unpleasant task at the conclusion of his reign. He tells the newspaper: “I did not want the new chief executive to start with this project. I should shoulder this one; it’s the right thing to do.” British unions said they will fight the plan. GSK was not alone last week in the industry’s downsizing sweepstakes. Massachusetts biotechie Sepracor said it plans to chop 300 rep positions, in response to slow sales for respiratory Rx levalbuterol (Xopenex.) The product faces reimbursement challenges. Sep seeks to lop off one-sixth of its sales and marketing expenses, pocketing up to $100 million next year.
TAKEDA IT ON THE CHIN
YOU THOUGHT YOUR WEEK WAS BAD? Well, it was worse at Takeda Pharmaceutical. The Japanese drugmaker has been pinning its hopes on antilipemic Tx candidate lapaquistat, but stateside regulators last week suggested halting trials of the compounds at 100 mg doses. The FDA cited a potential renal side-effect, and called for more data. That request disappointed investors, who were expecting approvals in 2009. Shares in the company fell by 12.5 per cent following the development. An analyst tells Bloomberg news the Rx “was the most promising among the three important ongoing projects at Takeda. It’s going to put severe pressure on Takeda to find avenues for growth beyond 2011.” Meanwhile, Takeda also managed to win an award from an international consumer group last week—but, unfortunately, it was the wrong kind of distinction. The company was handed the Bad Product of the Year award by Consumers International, which accused Takeda of marketing its sleep disorder Tx to children. Takeda edged out Mattel, which was noted for marketing 21 million tainted toys manufactured in China.
CORNER-OFFICE ROTISSERIE
DRAXIS HEALTH prexy Martin Barkin plans to step down after 15 years helming the Mississauga, Ont. drugmaker. Dan Brazier, the current COO, will take over until a permanent successor is named.
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