UPFRONT 1997: OTC Pharmaceuticals

Several new FDA-approved statins reduce cholesterol, but competition between them are fattening up this year’s ad budgets

In the U.S. pharmaceutical market, a growing number of companies are mining gold in the clogged arteries of American consumers. Significant research and advertising dollars are flowing into the $3.4 billion cholesterol-reducing or “statin” market, which is growing by double-digits every year. It’s expected to reach $6 billion by the year 2000.

The latest drug to hit the market, Warner-Lambert’s Lipitor, is already the company’s most successful prescription remedy ever. In its first 11 weeks on the market, Lipitor grabbed about 15 percent of all new prescriptions. U.S. sales of the drug were estimated at $25-$30 million just for the month of April. Officials told analysts recently that the drug is now the No. 1 written statin among endocrinologists, and the No. 2 statin among cardiologists. “It’s still beating expectations,” says Robert Uhl, pharmaceutical analyst at Salomon Brothers, N.Y.

Lipitor enters a highly competitive category. Among the other statins on the market are Mevacor from Merck, Pravacol from Bristol-Myers Squibb, and Novartis’ Lescol. The emergence of Lipitor has forced the other drugmakers to either advertise heavily, in an effort to communicate their points of difference, or to pull back.

In the case of Pravacol, Bristol-Myers has pursued the aggressive approach, recently taking out two-page newspaper spreads claiming that its product is “the first and only drug of its kind proven to prevent first heart attacks.” B-M also highlighted a seal of approval from the American Heart Association, a potentially key marketing coup. Last year, B-M spent more than $19 million advertising Pravacol, a figure that should rise this year.

Novartis, which spent about $1 million on advertising Lescol last year, will probably spend more than that this year, but officials declined to reveal details. Merck, meanwhile, is pulling back from promoting Mevacor, in part because the drug’s patent expires in four years and partly because of the competitors reaching the market.

Lipitor is also another good example of how drug companies that are normally archrivals continue to form joint ventures when it serves their mutual interests. In this case, Warner-Lambert’s prescription drug subsidiary, Parke-Davis, came up with the drug itself. But P-D is not known as a sales powerhouse. So W-L asked four drug companies to bid for a joint venture on Lipitor. Pfizer, which has a renowned sales team, eventually won out.

In the Rx-to-OTC arena, a number of companies are working on so-called “histamine blockers” that are supposed to stop allergy processes before they occur. The first out of the OTC gate was Nasalcrom, from McNeil Consumer Products, a division of Johnson & Johnson. But Schering-Plough is also working on a competing drug, Vancenase AQ, as is Glaxo-Wellcome with Becanese AQ. -Sean Mehegan


* New round of Rx to OTC remedies coming in ’97

* Race for new allergy medications nothing to sneeze about

* Competition heats up in the “statin” (cholesterol-reducing) market

OVERALL: Spending up

DARK HORSE: Will Warner-Lambert’s alliance with Pfizer work out?

Copyright ASM Communications, Inc. (1997) ALL RIGHTS RESERVED