Jockeying for Position Among APIs

15 March 2004 00:01  [Source: ICB Americas]

Only a handful of blockbuster contenders are expected to receive approval this year, but US prescription drug sales are still expected to reach double-digit growth. Patricia Van Arnum reports.

The performance of the pharmaceutical industry is a pivotal consideration for custom manufacturers and fine chemical producers, who are looking to the near- and short-term pipeline to help spur recovery. While pharmaceutical sales were strong last year, with double-digit growth in the US, the number of new active pharmaceutical ingredients (APIs) was again on the low side. Looking ahead, analysts see another year of double-digit growth in the US, but they consider only a handful of actual or anticipated market launches to be capable of achieving blockbuster status.

US prescription drug sales grew 11.5 percent to $216.4 billion in 2003, up from $194 billion in 2002, according to IMS Health, a Plymouth Meeting, Pa.-based market-analysis firm. Generic and biotech dollar sales were key contributors to the results. Both grew by more than 22 percent, according to IMS. Affecting these results were the impact of switches from prescription to over-the-counter (OTC) status, continuing safety concerns about the use of hormone replacement therapy and growing reimportation of prescription pharmaceuticals from Canada (see related story, FR 6). US reimportation of prescription pharmaceuticals from Canada totaled $1.1 billion last year.

“As we predicted, 2003 pharmaceutical growth remains constant in comparison with 2002,” Paul Wilson, vice president of IMS Statistical Services, observed of last year. “The constancy of [2003’s] sales growth is a by-product of the market traction produced by new products.”

Last year, 21 new molecular entities (NMEs) were approved, versus 17 in 2002. Although an improvement, the number approved was the second lowest in any given year over the past ten. Only 2002 had fewer approvals. Still, analysts note that several key products entered the market last year and in late 2002.

“Notable new products introduced in late 2002 or 2003 included two new cholesterol treatments: AstraZeneca’s Crestor and Schering-Merck’s Zetia, as well as the first non-stimulating ADHD [attention deficit hyperactivity disorder], Eli Lilly’s Strattera,” says Mr. Wilson. Strattera (atomoxetine), which was approved in November 2002, garnered sales of $370.3 million in 2003, its first full year on the market. The drug, a norepinephrine reuptake inhibitor, has a different mechanism of action than other ADHD drugs on the market. These competitors are stimulant medicines for treating ADHD and include methylphenidate (Ritalin and generics), dextroamphetamine (Dexedrine and generics), methamphetamine (Desoxyn), and an amphetamine-dextroamphetamine combination (Adderall).

AstraZeneca’s Crestor (rosuvastatin), a new statin in the anti-cholesterol class, was approved last August. It posted 2003 global sales of only $129 million, but analysts project blockbuster status for the drug, with forecasted sales revenues of $1.51 billion by 2007 and $3.47 billion by 2008, according to Datamonitor PLC, a London-based market analysis firm. The other key entry, Schering-Merck’s Zetia (ezetimibe), a cholesterol absorption inhibitor that was launched in November 2002, had global sales of $469 million in 2003. Despite these inroads, Pfizer’s Lipitor (atorvastatin) remains the leader in the anti-cholesterol class and in the US market (Figure 1, above). The drug has maintained its lead position in the cholesterol reducers market with relatively few patients switching to the new products, says IMS’s Mr. Wilson. Lipitor posted global sales of $9.2 billion in 2003.

Aside from Crestor, two other 2003 launches were deemed to have strong market potential, according to IMS: Abbott Laboratories’ Humira (adalimumab) and Genentech’s Raptiva (efalizumab). These two drugs are monoclonal antibodies, and their approval reflects the increasing importance of biologics in the drug market. Humira, indicated for rheumatoid arthritis, earned global sales of $280 million last year, and it is considered by analysts to be a potential blockbuster. Raptiva, indicated for psoriasis, has forecasted sales of $353 million by 2007, according to Datamonitor.

Two other potential strong-selling drugs introduced last year were directed at the niche therapeutic class of erectile dysfunction (ED): Bayer/GlaxoSmithKline’s Levitra (varde-nafil), which was approved in the US in August, and Eli Lilly’s Cialis (tadalafil), which was approved in November. The two drugs, both orally administered ED drugs, will compete head on with the number one drug in this class, Pfizer’s Viagra (sildenafil), which posted 2003 global sales of $1.88 billion. Viagra continues to hold the majority share in the ED market, with roughly 85 percent, according to IMS. “Given the strong promotional campaigns of the two newcomers, Levitra and Cialis, this market will continue to expand and the battle for market share will play out in 2004,” says Mary Beth Lawrence, vice president, IMS Consulting.

Generic and OTC competition were also factors for other top-selling therapeutic classes and products in 2003. “The proton pump inhibitors (anti-ulcerants) and the SSRI/SNRI (antidepressants), the number two and three classes respectively, held their market positions last year even though consumers had the choice of a generic substitute(s) in both classes, along with the additional competition of an OTC anti-ulcerant, AstraZeneca’s Prilosec OTC,” says Doug Long, vice president of IMS Industry Relations. “The antihistamine (allergy) class slipped to ninth position from seventh the prior year due to OTC competition from Schering-Plough’s Claritin.”

A key to maintaining the standing of the anti-ulcerants class was AstraZeneca’s successful strategy of converting patients to Nexium (esomeprazole), a second-generation successor to its once best-selling product Prilosec (omeprazole). Faced with generic competition, global sales of the anti-ulcerant Prilosec plummeted almost 45 percent last year to $2.56 billion. At the same time, global sales of Nexium increased 40 percent over 2002 and reached $3.30 billion. Nexium moved into seventh place in US prescription product sales overall in 2003, replacing Prilosec, which fell out of the top US prescription products in 2003. In 2002, Prilosec ranked number four in US prescription sales, dropping from its number two spot in 2001 following the entry of generic competition.

The antidepressant class also successfully navigated generic entries, in part owing to the performance of Pfizer’s Zoloft (sertraline), a selective serotonin reuptake inhibitor (SSRI). Zoloft posted global sales of $3.11 billion last year, garnering the eighth spot in the US prescription drug market, where sales reached $2.9 billion with year-over-year growth of 11.5 percent. The SSRI class of anti-depressants took a hit, however, with last year’s entry of a generic version of GlaxoSmithKline’s SSRI Paxil (paroxetine). Paxil, which had earned the tenth spot in sales among US prescription drugs in 2002, fell out of the top ten in 2003. Global sales of Paxil fell 4 percent last year to £1.9 billion ($3.5 billion), with generic products launched in the US in September. Erosion has continued this year, as generics accounted for 52 percent of total prescriptions for paroxetine as of January 2004, according to GlaxoSmithKline.

Paxil and Eli Lilly’s Prozac (fluoxetine), which lost its blockbuster status in 2002 because of generic entries, and competitive challenges to antidepressants as a whole are contributing to the declining revenue status of the SSRI class. With few entrants and further patent expiries by 2009, global antidepressant sales are expected to decrease 21.5 percent to $13.5 billion by 2011, according to Datamonitor. The serotonergic class dominates, accounting for 57.6 percent of the antidepressant market in 2002. “However, all of the leading brands will suffer patent expiries by 2009,” says Datamonitor. “As physicians are encouraged to utilize cheaper generics, brand players must look towards maximizing revenues through product differentiation and innovative lifecycle strategies.”

Wyeth’s noradrenergic, Effexor (venlafaxine), has positioned itself as a relatively unique product in the antidepressant market, notes Datamonitor. The drug moved into the top 20 in US prescription product sales last year, earning the fourteenth spot with US sales of $2.1 billion and growth of 38 percent in 2003 over 2002, according to IMS. Unlike the other major antidepressants, which are SSRIs, Effexor is a serotonin-norepinephrine reuptake inhibitor (SNRI), and it has benefited from being the only SNRI available in most major pharmaceutical markets. Wyeth’s strategy for Effexor has also helped to move the drug to a major player.

“Unlike other manufacturers of second-generation antidepressants, Wyeth targeted Effexor at generalized anxiety disorder (GAD) as its primary anxiety disorders market,” says Andrew Jones, health care strategy analyst at Datamonitor. “The majority of other antidepressant manufacturers targeted either panic disorder or obsessive-compulsive disorder (OCD). This resulted in Wyeth quickly establishing Effexor as a leading drug in the market.” Wyeth also gained a label-change for Effexor in 2001, stating that it was to be used to maintain depression remission. “Maintaining depression remission is a key unmet need in the treatment of depression, and Effexor was the second-generation antidepressant to have gained this approval,” he says.

Another important 2004 entry is Eli Lilly’s Cymbalta (duloxetine), both an SSRI and SNRI. Lilly is developing it for two separate indications: depression and urinary stress incontinence. The drug, which is expected to be approved this year, is slated for possible blockbuster status by 2008, when forecasted sales are expected to reach $987 million, according to Datamonitor. Lilly received a second approvable letter for Cymbalta last September, which made final approval contingent upon resolution of issues at Lilly’s Indianapolis manufacturing facilities, a matter that Lilly says is resolved.

“The US Food and Drug Ad-ministration informed Lilly that the agency considers the company’s in-jectable and dry products facilities in Indianapolis to have reached a level of current good manufacturing practices compliance that allows preapproval site inspection for products under review to occur,” says a company official. “[The] FDA has indicated that it does not currently believe a preapproval inspection for Cymbalta will be necessary. However, a preapproval inspection remains at the discretion of the FDA. Lilly has submitted its complete response to the approvable letter and continues to anticipate US approval and launch of Cymbalta in the summer of 2004.”

IMS also points to other innovative products that have received or which are slated to receive market approval this year. One is Roche/Genentech’s Avastin (bevacizumab), which was approved last month for use in combination with intravenous 5-fluorouracil-based chemotherapy as a treatment for patients with first-line-or previously untreated metastatic cancer of the colon or rectum. Avastin is a therapeutic antibody designed to inhibit vascular endothelial growth factor (VEGF), a protein that plays an important role in tumor angiogenesis, the formation of new blood vessels to the tumor and the maintenance of existing tumor blood vessels. Analysts estimate sales of $275 million in 2005, with peak sales potential of $1 billion.

The much awaited approval of Erbitux (cetuximab), the anti-cancer treatment from Bristol-Myers Squibb and ImClone Systems, occurred last month. The drug, which is indicated for colorectal cancer, has the potential to be a strong-seller. Market estimates are for $399 million in sales by 2005 and forecasted sales for $804 million by 2008.

Another possible entry into the anti-cancer market for 2004 is Genasense (oblimersen). Aventis and Genta Phar-maceuticals submitted a new drug application and received priority review status last month for Genasense, which some analysts pro-ject as a possible blockbuster. The drug, which has forecasted sales of $937 million by 2008, according to Datamonitor, is a new treatment for cancer. “This new drug application represents the first clinical indication for a drug that promotes chemotherapy-induced apoptosis, the first systemic use of an antisense therapy, as well as the first new drug for patients with advanced melanoma in almost 30 years,” says Loretta M. Itri, Genta’s president of pharmaceutical development and chief medical officer.

Another up-and-coming product for 2004 is Forest Laboratories’ Namenda (memantine), which was approved last October. The drug, an N-methyl-D-aspartate (NMDA) receptor antagonist indicated for the treatment of moderate to severe Alzheimer’s disease, focuses on the glutamate pathway for treating the disease. It is the first drug approved specifically for treating moderate to severe Alzheimer’s disease.

Other drugs to watch from 2004 hail from Pfizer. Last October, Pfizer received Food and Drug Administration approval for Inspra (eplerenone) for heart failure in patients who had suffered a heart attack. Forecasted sales estimates for the drug are $386 million by 2005 and $1.16 billion by 2008. Another Pfizer drug—pregabalin—is also on the market radar as a possible blockbuster drug. The FDA accepted the regulatory submission of pregabalin for the treatment of epilepsy, neuropathic pain associated with diabetic peripheral neuropathy, neuropathic pain associated with herpes zoster, and generalized anxiety disorder. If approved this year, forecasted sales are estimated at $760 million by 2005 and $1.92 billion by 2008, according to Datamonitor.

Pfizer officials point to the strength of the company’s early and late-state pipeline.

“The early-stage pipeline is benefiting from productive internal discovery research. The mid- and late-stage pipelines are growing, supplemented by targeted licensing and acquisition of late-stage candidates,” says John LaMattina, president, Pfizer Global Research and Development. “We are on track to meet our goal of filing 20 major NDAs in the five-year period ending in 2006. To date, we have completed six of the 20 anticipated NDA filings, and we anticipate another productive year in 2004.”

Another drug anticipated for 2004 is Pfizer’s Caduet, the Lipitor-Norvasc one-pill combination. Pfizer completed its filing with European regulatory authorities in December following a filing with the FDA last March. The product has been developed in a wide range of dosing combinations for treating patients with hypertension and high cholesterol. If approved in 2004, forecasted sales are $543 million by 2005 and $1.09 billion by 2008, according to Datamonitor.

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