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JUNE 30, 2003
Fat City for Pfizer? The drugmaker insists Lipitor sales will hit $10 billion, and Vice-President Gary Palmer doesn't think rivals or co-pay fees can stop it In 2005, Lipitor will be the first prescription drug to hit $10 billion in annual sales, predicts Pfizer (PFE ), maker of the anticholesterol medication. With $8 billion in sales in 2002, Lipitor is already the world's No. 1 prescription drug, selling as much as the other medications in its class combined. And given that tens of millions of people with high cholesterol aren't being treated, the potential market is huge for Lipitor and similar drugs, called statins, which block the liver from turning fat into cholesterol. The key word, however, is "potential," because growth in statin sales hasn't been as hearty as the available market might suggest. The industry is hoping for a 10% rise in new statin prescriptions this year, but thus far the numbers suggest that figure will be hard to reach. Through April, 2003, overall prescriptions were up just 2%, while Lipitor has seen a 4% rise. When judged against the double-digit gains of just a few years ago, that's disappointing. Analysts blame the sluggish economy and increasingly stringent co-pay systems at health-insurance companies, which persuade some uninsured patients to forgo the drug rather than shell out from $50 to $60 a month. Also, because of significant market penetration by statin makers, the early and easy gains are now harder to sustain. More competition is on the horizon. Over the next year, new products from Merck (MRK ), Schering-Plough (SGP ), and Astra-Zeneca (AZ ) threaten to crimp Lipitor's growth. Plus, a generic version of Merck's blockbuster statin, Zocor, will hurt the brand-name drugs' market share when it becomes available in 2007. Whether the Lipitor franchise flourishes or stagnates is key to Pfizer's success. Even after its $60 billion stock acquisition of Pharmacia, completed in April, 2002, Pfizer sees Lipitor as critical to offsetting coming weakness in other areas. The $46 billion company hopes that highlighting years of data to show Lipitor's years of safety and efficacy will give it an edge over upcoming products. Pfizer isn't stopping there, however. It's also testing Lipitor in a number of other diseases, including diabetes, and it's testing single pills that are a combination of Lipitor and other Pfizer products. BusinessWeek Online Reporter Amy Tsao spoke to Dr. Gary Palmer, vice-president of Pfizer's U.S. cardiovascular group, on June 19. Edited excerpts of their conversation follow: Q: Why is sales growth for statins slowing down? And where is the market headed? A: It's a concern, but probably a temporary blip. It's open to a lot of speculation in terms of why things slowed. Economic factors may be at work, health-insurance issues, for example. It's a bit disappointing for us because heart disease is still a major cause of mortality. Out of probably 64 million people [in the U.S.] who are eligible to take statins -- and more and more all the time -- it's pretty disappointing that only 11 million are being treated [with Lipitor]. Q: At its recent analyst meeting, Pfizer said some 42 million potential patients are untreated or undiagnosed. How will you reach that population? A: It's a challenge. People are difficult to reach, largely because raised cholesterol is asymptomatic. We're trying to get people more aware that they need to be tested, through direct-to-consumer advertising and screening programs. There are still a lot of people out there who realize they have high cholesterol only when they have their first heart attack or stroke. Often, people who are overweight and are eating the wrong things and are developing atherosclerosis [hardening of the arteries] should be treated. Q: Recently, investors bid up Pfizer stock after strong results were reported from a trial of Lipitor in diabetics. Is there some overlap here, since many diabetics will likely also have high cholesterol? A: Typically, what has happened is that diabetics are focused on treating glucose levels. They usually have abnormalities in cholesterol as well, but that's often seen as secondary. In many cases, they don't get treated at all for cholesterol. The diabetes associations have included strict cholesterol-lowering in their guidelines. For the first time, diabetics are being equated to people with heart disease. That's a relatively new development. Guidelines will take a while to filter through to general practitioners. Even though diabetics are newly diagnosed or have modestly raised levels of cholesterol, they could benefit from Lipitor. All the evidence is pointing in that direction. We don't yet have an [FDA approval] for reducing morbidity and mortality in diabetics, but we expect to file for FDA approval as soon as possible.
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