Amgen's Uphill Marketing Battle

Shares of the biotech giant surged on signs its bone-loss treatment is effective, but getting doctors to prescribe the drug will be tough

By Arlene Weintraub

When biotechnology giant Amgen (AMGN) announced study results for its experimental bone-loss treatment denosumab, Wall Street cheered.

In a head-to-head trial against the popular Novartis (NOVN) drug Zometa, denosumab was clearly superior in treating breast cancer patients who suffered bone loss when their cancer spread, according to research results released July 7. Deutsche Bank (DB) added $550 million to its forecast of the drug's peak annual sales, suggesting it could someday bring in $3 billion a year. Other analysts were even more bullish, predicting the drug could generate $1 billion to $2 billion in the breast-cancer market alone—that's on top of what Amgen might haul in by selling the drug to women with post-menopausal osteoporosis. Early in the day's trading session, Amgen's stock soared 15%, to 60 a share, before closing at 59.50.

The rally was fueled by some mighty big expectations that won't be easy for Thousand Oaks (Calif.)-based Amgen to meet. For starters, the Food & Drug Administration won't decide whether to approve the drug for osteoporosis until October. (The company hasn't filed for the cancer indication yet.) More important, in getting doctors to prescribe the drug and patients to clamor for it, Amgen may be facing its biggest marketing challenge yet. The osteoporosis market is dominated by some of the most famous names in pharmaceuticals: Roche's Boniva, Novartis' once-yearly version of Zometa called Reclast, and Merck's (MRK) Fosamax, which went generic last year. About 38 million prescriptions are written for bone-loss treatments every year, and the market reached $4.6 billion in sales in 2007, according to IMS Health (RX). Total sales dropped 22% last year when cheap versions of Fosamax became available.

Breaking Down Barriers

Denosumab will offer some distinct advantages over its rivals. In post-menopausal osteoporosis, patients will be able to get denosumab as a twice-yearly injection from primary-care doctors. That will make it more convenient than Fosamax, which is a daily or weekly pill, and Boniva, which patients take monthly. And unlike some of the older drugs, denosumab rarely touches off a frightening side effect called osteonecrosis of the jaw (ONJ), which can cause pain and bone protrusions in the mouth. (In the most recent trial, ONJ was rare in the Zometa group, too.)

But Amgen will have to achieve what none of its peers has ever attempted before: getting primary-care physicians comfortable with the idea of injecting a biotech drug into their patients. Denosumab, which will likely carry the brand name Prolia, will be the first nonvaccine biologic product to be marketed to general practitioners. It's a gigantic market where the 29-year-old company has until now been a complete nonplayer. Amgen's biggest products, such as Araesp and Enbrel, are sold to rheumatologists, oncologists, and other specialists. What's more, denosumab is not the type of product patients can inject themselves, so doctors will have to prod them to come into the office twice a year. That could be a hard sell, especially when physicians have the option of prescribing inexpensive pills. Roger Perlmutter, Amgen's vice-president of research and development, isn't worried. "Most elderly people are seeing a doctor every six months anyway," Perlmutter said in a June interview.

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