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Drugs Manufactured By Eight Pharmaceutical Companies In Puerto Rico Sell $74.5 Billion In 2003
Account for 50% of those companies global sales of $153.3 billion
By MARIALBA MARTINEZ
April 8, 2004
Sales of pharmaceutical drugs manufactured by eight companies operating in Puerto Rico amounted to $74.5 billion last year, or 49% of those companies global sales of $153.5 billion, according to a CARIBBEAN BUSINESS analysis.
CB examined the local production of pharmaceutical drugs by manufacturers Abbott Laboratories, Amgen, Bristol-Myers Squibb, Eli Lilly & Co., Merck & Co., Pfizer Inc., Schering-Plough, and Wyeth. Schering-Plough saw sales decrease by 15%, while the rest averaged 21% sales increases in 2003.
While worldwide sales of these eight firms rose during 2003, their earnings decreased 13%, from $27.2 billion in 2002 to $23.6 billion. In general, most companies earnings were affected last year by losses of patent protection, such as Schering-Ploughs Claritin; competition from drug imports from foreign countries, mainly Canada; and few new-product launches as a result of weak pipelines, which in turn means few approvals by the U.S. Food & Drug Administration (FDA).
Pharmaceutical firms stock prices influenced by politics, FDA
Politics have also influenced the stock prices of pharmaceutical companies. According to Morgan Stanley analyst Jami Rubin, while Democratic candidates propose rewriting Medicare rules to let the government negotiate prices with drug companies, Republicans are more sympathetic to large pharmaceutical companies retaining more control of their drug prices.
Pharmaceutical companies could also be affected by the FDAs plan to create a new system to alert U.S. Securities & Exchange Commission regulators to misleading statements about their products. FDA Commissioner Mark McClellan said, "We will protect the confidential information [pharmaceutical companies give] us, but that doesnt mean [they] can feel free to mislead the investment community."
These issues have come to investors attention recently, such as when ImClone Systems CEO Samuel Waksal, head of the biotechnology company that came up with an experimental cancer drug called Erbitux, was found guilty of securities fraud and obstruction of justice for misleading the public about the drugs prospects. Home-decorating expert Martha Stewart was also convicted of obstruction of justice and lying to investigators about the sale of her ImClone shares. Recently, the FDA warned Wyeth about making false claims about antidepressant Effexor outperforming other competitors.
New patents on upswing after dearth of new drug applications
New drug applications continue to be presented before the FDA for approval. In a recent report, the FDA said newer methods are needed to ensure more medical innovations reach consumers to avoid rising healthcare costs for companies and patients. Research & development costs of pharmaceutical drugs have also soared, from $318 million in 1987 to $800 million in 2000.
Nevertheless, there are new drugs in the works. Amgen, a biotechnology firm with manufacturing operations in Juncos, said it has 14 drugs in mid- or late-state trials. The company is said to be focusing on five areas: inflammatory disease, metabolic disorders and osteoporosis, cancer, blood and kidney ailments, and neurology. Four of its top five drugs are manufactured on the island.
Merck is seeking FDA approval of its experimental painkiller Arcoxia, a drug similar to Vioxx. Its cholesterol drug Zocor in combination with Schering-Ploughs Zetia, a new treatment co-developed by the two companies that works through the intestine instead of the liver, was recently cleared in Mexico, the first regulatory approval. Analysts said that after FDA approval in the U.S., the combination drug will become the most powerful reducer of LDL, known as bad cholesterol.
Eli Lilly expects approval by this summer of a new depression drug called Cymbalta, estimated to earn up to $2 billion in annual sales. After Prozacs patent expiration in 2001, the company is counting on new drugs such as Strattera (for attention-deficit disorder), Symbyax (depression), and protein kinase C (a beta inhibitor for diabetes) to increase sales. All three drugs are scheduled to be manufactured in Puerto Rico once the $125 million expansion of Eli Lillys state-of-the-art bulk manufacturing facility in Mayaguez is completed, adding 150 people to the plants work force.
In March, Pfizers exemestane was recognized for lowering the chance of developing additional tumors in women with breast cancer by 32%. Exemestane is marketed by Pfizer as Aromasin and manufactured in Arecibo. By the end of 2003, at least two companies had joined the battle of erectile dysfunction treatments, challenging Pfizers Viagra.
Eli Lillys contender, Cialis, captured 17% to 40% market shares in countries such as Australia, France, Germany, Italy, Brazil, Spain, and Britain. In 2003, GlaxoSmithKline launched Levitra in the U.S., promoted for its rapid effect, while Cialis works for up to 36 hours, earning it the nickname "the weekend pill." Pfizer suspended efforts to manufacture a female Viagra pill, citing inconclusive clinical studies.
Wyeth is still subject to regulatory scrutiny as its estrogen-replacement study with drug Premarin was halted due to serious health risks. In 2002, the Womens Health Initiative stopped a similar trial for women using Prempro, another hormone-replacement drug made by Wyeth. The study found that women taking the drug had higher risks of heart attacks, strokes, and breast cancer after five years of use. Sales of Premarin and Prempro, both manufactured in Puerto Rico, fell 32% in 2003 to $1.3 billion, contributing to a 54% decrease in Wyeths earnings.
Several companies have also recently won patent extensions for their products. In mid-March, Abbott Laboratories stopped Torpharms generic version of Depakote, an epilepsy drug also used in the treatment of manic depression or bipolar disorder. Bristol-Myers Squibb is trying to extend the patent of its cancer drug Paraplatin by six months, based on its unique success in pediatric clinical trials. Merck also sought to extend by six months its marketing exclusivity for painkiller Vioxx as a supplemental new-drug application.
This Caribbean Business article appears courtesy of Casiano Communications.