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Specialty Rx offers pharma a patent cliff parachute

BY Alaric DeArment

NEW YORK —While Big Pharma hurdles toward the edge of the patent cliff, some of the latest emerging data seem to indicate that the cliff won’t be too far off the ground. It’s been widely reported that large drug makers are in trouble, with many of their top-selling drugs set to lose patent protection over the next decade—chief among them Pfizer’s Lipitor (atorvastatin), which IMS Health ranks as the top-selling drug, with sales of $7.5 billion in 2009. Lipitor will lose patent protection next year, when Ranbaxy Labs will begin marketing its own version.

But now, it seems some big drug makers are set to bounce back and stay high. Thanks to its acquisition of Wyeth, Pfizer got a major revenue boost from specialty drugs in first-quarter 2010, with sales increasing by 141%, to $3.5 billion. Biotech drugs increased by 44%, from $10.1 billion in first-quarter 2009 to $14.5 billion in 2010. Merck, thanks to its May 11 acquisition of Schering-Plough, that it had more than 20 investigational drugs in late-stage clinical development, with a pipeline that included such drugs as the osteoporosis treatment MK-0822 (odanacatib), the hepatitis C treatment SCH 503034 (boceprevir) and the cancer treatment MK-0646 (dalotuzumab).

It’s no coincidence the two companies are banking on high-cost specialty drugs. According to some experts, it’s specialty drugs with large price tags rather than conventional drugs with large patient populations that will be the sources of growth for Big Pharma. According to IMS Health, a number of specialty drugs, including Pfizer’s and Amgen’s autoimmune disorder drug Enbrel (etanercept) and Genentech’s cancer treatment Avastin (bevacizumab), already had blockbuster-level 2009 sales of $3.3 billion and $3 billion, respectively, though neither made IMS’ list of the top 15 drugs measured by dispensed prescriptions.

This trend will have major implications in the years to come, according to British drug market analysis firm EvaluatePharma. The firm forecasted that by 2016, Pfizer and Merck will be the top two drug makers in the world, followed by Novartis, Roche and Sanofi-Aventis, which also have significant presences in the specialty drug market. Enbrel will become the third highest-selling drug in the world, with forecasted sales of $7.3 billion, while the autoimmune disorder drug Remicade (infliximab)—made by Merck, Johnson & Johnson and Mitsubishi Tanabe—will take the seventh spot, with $5.7 billion in sales. Biotech drugs for treating autoimmune disorders and cancer will dominate the market, while GlaxoSmithKline’s asthma and chronic obstructive pulmonary disease drug Advair (fluticasone and salmeterol) and AstraZeneca’s cholesterol drug Crestor (rosuvastatin) will have the highest sales among conventional drugs.

EvaluatePharma CEO Jonathan de Pass said he expects “huge growth in sales of complex biologics, driven in part by the premium price they can command and the industry’s productivity in getting these compounds to market. We will also see generics players…achieving impressive growth due to a continued sales erosion of blockbuster products coming off patent.”

Worldwide prescription pharmaceutical sales

 

Worldwide annual sales (US$ billions)

Market share

Market rank

*Proforma data in 2009 (Pfizer + Wyeth/Merck + Schering-Plough) † Ranked by projected 2016 sales Source: Evaluate Pharma World Preview 2016
Rank† Company 2009 2016 Annual growth (’09-’16) 2009 2016 2009 2016
1 Pfizer* $55.3 $47.1 -2% 8.6% 6.0% 1 1
2 Merck* 41.6 46.3 2 6.5 5.9 2 2
3 Novartis 37.3 46.0 3 5.8 5.9 4 3
4 Roche 36.0 43.9 3 5.6 5.6 6 4
5 Sanofi-Aventis 38.3 38.9 0 6.0 5.0 3 5
6 GlaxoSmithKline 36.3 38.7 1 5.6 4.9 5 6
7 Abbott Laboratories 16.5 26.1 7 2.6 3.3 10 7
8 Johnson & Johnson 21.3 24.8 2 3.3 3.2 8 8
9 AstraZeneca 31.6 22.1 -5 4.9 2.8 7 9
10 Teva Pharmaceutical Industries 12.6 20.8 7 2.0 2.7 15 10

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NACDS puts a new spin on Meet the Market

BY Michael Johnsen

SAN DIEGO This year the National Association of Chain Drug Stores introduced two new features to its Meet the Market format. First, NACDS hosted a Meet the Market Presentation Template webinar twice prior to Meet the Market, in which NACDS introduced a meeting template that succinctly captured all of the information retailers typically use to evaluate a new product or company.

Also new to Meet the Market were the booths of 10 service companies — trade media and professional education, merchandising consultants and marketing/media information companies — which afforded an opportunity for new and smaller suppliers to meet with these organizations.

“New companies have a need not only to meet with retailers, obviously, they have a need for their business,” noted Jim Whitman, NACDS SVP meetings and conferences. Another ongoing improvement is the productivity within each meeting, Whitman added. “We keep refining the match, the appointments,” he said.

This year, the Meet the Market format — in which smaller and new suppliers have 10-minute meetings with their category buyers — represented more than 8,000 face-to-face pre-arranged appointments.

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Retail clinic growth slowing down? Not a chance

BY Antoinette Alexander

WHAT IT MEANS AND WHY IT’S IMPORTANT The news that Target is looking to expand its retail-based clinic business this year is yet one more indicator that reports of the demise of retail clinic growth have been greatly exaggerated.

(THE NEWS: Target to expand its retail clinic presence. For the full story, click here)

As the article states, Target, which opened its first clinic in 2006, is looking to open up eight new locations this September. It already operates 28 locations in Minnesota and Maryland.

It wasn’t so long ago — April to be exact — that CVS Caremark’s MinuteClinic indicated that it could double its current number of clinics in five years.

Why the growth? Well, aside from the aging population and a shortage of primary care physicians, a major catalyst is healthcare reform, which will mean that 32 million people who currently are uninsured will have healthcare coverage. With emergency rooms already overflowing, and primary care physicians already over-extended, having a retail clinic nearby where patients can receive convenient, quality and affordable health care will only become increasingly important.

Meanwhile, RediClinic, which has 22 clinics in H-E-B stores in Houston and Austin, Texas, is cranking up its marketing efforts and has tapped former Duane Reade executive Jeff Thompson as VP marketing. Thompson will be responsible for RediClinic’s consumer and partner marketing activities, including developing and implementing strategic customer acquisition/retention programs, new product delivery and brand strategy.

Thompson most recently served as VP marketing for Duane Reade.

Clearly, there continues to be significant growth opportunities for clinics — both in terms of the number of clinic locations and the scope of services offered within the clinics. As mentioned earlier, there are 32 million reasons why the growth will be quite dramatic.

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