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MERCK LAUNCHES PLENDIL AT 23%-TO-60% DISCOUNT

Executive Summary

MERCK LAUNCHES PLENDIL AT 23%-TO-60% DISCOUNT to other once-a- day calcium channel blockers indicated for hypertension, the company announced Sept. 24. Shipments of Plendil (felodipine) began Sept. 16, the company said. Direct price to wholesalers of 5 mg Plendil is $ 64 for 100 tablets and $ 115 for 100 tablets of 10 mg strength. "Plendil offers highly effective blood pressure reduction, convenient dosing and unequaled value for once-daily calcium channel blocker therapy," Merck said in a press release announcing the launch. Plendil was approved on July 25 ("The Pink Sheet" Aug. 5, T&G-13). Merck based its calculations of the discount on the price per tablet of the recommended starting doses of Plendil, Pfizer's Procardia XL (nifedipine), Searle's and Knoll's Calan SR/Isoptin SR (verapamil), and Lederle/Wyeth-Ayerst's Verelan (verapamil). Merck used direct price to wholesalers for its comparisons, except for Calan SR and Isoptin SR where only average wholesale price was reported. According to Merck, the price per tab for each of the products is: 64" for 5 mg Plendil; 89" for 30 mg Procardia XL; $ 1.60 for 60 mg Procardia XL; 94" for 180 mg Calan SR/Isoptin SR; and 83" for 240 mg Verelan. The price for a 10 mg tablet of Plendil would be $ 1.15, which is more expensive than the highest dose for each of the other products except Procardia XL, which costs $ 1.91 per 90 mg tablet, according to Medi-Span. Merck's decision to compete on price with Plendil reinforces the perception that price competition among new branded products is developing. Another recent example is Ciba-Geigy's launch of Lotensin, the seventh ACE inhibitor, at a 10%-to-44% discount to other ACEs ("The Pink Sheet" July 29, T&G-3). The Lotensin discount was tied to a lifetime price guarantee and its marketing included letters to physicians and a patient enrollment program. Merck did not reveal any details of its marketing program. The Plendil discount nevertheless appears to be more aggressive discounting than previous entries by Merck into established categories. Merck introduced Vasotec at a 23% lower cost per day than Bristol-Myers Squibb's Capoten, although variation in dosing regimens makes comparison difficult. Merck also launched the H[2] antagonist Pepcid at a discount to Glaxo's Zantac, although it was slightly more expensive than SmithKline's Tagamet. The pricing decision on Plendil also raises the question of how Merck will position its second HMG-CoA- inhibitor Zocor, once it is approved against Bristol-Myers Squibb's Pravachol and Merck's own Mevacor. Both Pravachol and Zocor could be approved within the next year. Plendil is the third Astra drug launched by Merck under a $ 60 mil. agreement reached in the early 80s. Tonocard and Prilosec are the other two. If the Astra products reach an unspecified trigger point in volume, an Astra-Merck joint venture will be set up in 1993. On June 1, Merck named Wayne Yetter as General Manager Astra/Merck Affairs. Yetter's varied background with MSD and Pfizer is indicative of the importance Merck assigns to its relationship with Astra. Prices for calcium channel blockers as a class increased 3.7% in the first half of 1991, according to drug price data from First DataBank. That increase was almost the same as the average 3.8% price increase for all drugs during the first half. Less than a third of the currently marketed calcium channel blockers showed price increases, according to First DataBank. Among those drugs increasing in price, the average increase was 12.4%. The two leading calcium channel blockers, Marion Merrell Dow's Cardizem and Pfizer's Procardia, showed price increases of about 5%, according to First DataBank.
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