Pharmalot… Pharmalittle… Good Morning
3 CommentsBy Ed Silverman // March 29th, 2010 // 6:45 am
Welcome back. We hope you had a nice weekend filled with relaxing moments and pleasant escapades. Now, though, the routine has resumed as meetings and deadlines beckon. As usual, we prepare by clutching the mandatory cup of stimulation. Grab your own or, perhaps, a bottle of water and greet the day. Here are a few items to help you on your way. Have a great day, everyone…
Antisoma Halts Phase III Lung-Cancer Drug Trial (MarketWatch)
Germany To Move Quickly To Enact Price Cuts (Reuters)
Eisai Hit By Delay In Filing Sepsis Drug (Seeking Alpha)
Roche To Cut 500 NJ Jobs (Dow Jones)
Test Predicts Which Patients Benefit From MS Drugs (Bloomberg News)
Merck Is A Bigger Beast To Feed (PharmaTimes)
KV Pharma Sees Shipment Resuming In Fourth Quarter (St. Louis Today)
Lisa Van Syckel
Hi Ed,
I would like to wish you, a peaceful, relaxing, Passover.
Salmon
So Merck is looking for compounds. So it looks like the purchase of SP for their late stage compounds was a bust. Who would have guessed?
I’ve been saying the industry has nowhere to go but down for years, and it’s not just Merck.
I’ve been using Pfizer as an example for years as even years ago sales were somewhat above %50 B and I’m pretty naive in terms of financials.
$50 Billion / yr in sales.
10% loss / year to generics. ($5B)
10% growth / yr growth needed for Wall St. ($5 B).
So Pfizer needs at least $10 B in new sales annually.
Assuming a blockbuster is $0.75 - 1Billion /yr in sales.
That’s 10 - 13 new blockbusters a year just for Pfizer.
The entire industry on average only gets ~24 new entities approved per year and most are not blockbusters. (Even $300 = 400 M / yr is a good drug).
In my mind the industry peaked a long time ago and has no where to go but down. That’s why you see so many shenanigans going on.
The companies I like in terms of growth are those with 1 - 2 good sellers and some good compounds in the pipeline.
Salmon
pharmavet
I don’t feel sorry for Eisai. I don’t mind paying $5/pill for a drug that actually works, but Aricept is a drug that I would term an “active placebo”. The first generic will hit in November, 2010, but that will also be likely overpriced due to ANDA exclusivity. With six more generics in the wings, the price should drop significantly beginning around May, 2011