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Executive Summary

Wyeth-Ayerst's Premarin conjugated estrogens product generated $569 mil. in worldwide sales in 1991. The product has doubled its revenues over the last two years. Sales in 1989 were $285 mil. Premarin sales increased 44.4% in 1991, which follows a 37.9% increase in 1990 when the 50-year-old product regained its market monopoly via the FDA-imposed withdrawal of generic versions of the hormone replacement therapy. Premarin is the only American Home product contributing more than 10% of corporate consolidated operating income before and after taxes, AHP noted in its most recent 10-K annual report to the Securities & Exchange Commission. AHP is the number one firm in terms of total numbers of prescriptions in the U.S., according to data recently released by Pharmaceutical Data Services ("The Pink Sheet" March 16, p. 9). PDS noted that, while AHP total Rx numbers have been declining, Premarin has been growing rapidly. The product generated over 21% more prescriptions in 1991 than 1990, PDS calculates. Premarin was the second largest product by scripts filled, with over 22 mil. in 1991, and was ranked fourteenth by dollar volume ($307 mil. at pharmacy acquisition cost). Premarin represents about one-quarter of Wyeth-Ayerst retail Rxs in 1991, but, surprisingly, less than 17% of the company's total pharmaceutical revenue (excluding infant formula sales). With the $686 mil. in infant formula sales in 1991, AHP's total human pharmaceutical business climbed over $4.1 bil. in 1991. The growth was achieved with relatively small price increases. AHP said that "U.S. sales increased 16% in 1991, due primarily to unit volume increases of 9% principally from the established female health care product line" and the introductions of Lodine and Norplant. According to First DataBank figures, AHP pharmaceutical product prices increased on average 2.8% in 1991, down from 8.1% in 1990 and 12.6% in 1989. AHP continued, however, to increase prices on the Robins products. The A. H. Robins line increased 5.8% in 1991, 24.1% in 1990 and 12.2% in 1989. Premarin's monopoly among conjugated estrogens is likely to continue at least into 1993. Some rumblings of new competition are beginning to surface, although FDA estimates that it will take two years to conduct studies needed for reformulated, bioequivalent generic conjugated estrogens. Duramed and Schein announced an agreement-in-principle in March to try to re-enter the market. Schein will fund development of a new generic version, and both companies will market and distribute the products ("The Pink Sheet" March 9, In Brief). As part of Wyeth-Ayerst's attempt to expand Premarin use further, the company has received approval to promote the product's cardioprotective benefits in France, Mexico and the U.K., AHP noted in its just published 1992 Fact Book. Efforts to add the cardioprotective indication to currently approved uses -- treatment of menopausal symptoms and prevention of osteoporosis -- are still underway in the U.S., the company said. An FDA advisory committee decided in June 1990 that studies on women who have had hysterectomies supported the cardioprotective claim for Premarin ("The Pink Sheet" June 18, 1990, p. 5). At the time, the advisory committee also recommended additional studies to support the claim, but not as a prerequisite to a labeling change. Similarly, a recent NIH consensus conference on triglycerides and coronary heart disease noted that "extensive observational studies" indicate a relationship between oral estrogen treatment for postmenopausal women and lower incidence of heart disease ("The Pink Sheet" March 2, p. 10). In addition to expanding Premarin's indications, Wyeth-Ayerst is looking to extend the franchise with an NDA filing for Premarin/MPA in the fourth quarter. The combined estrogen/progestogen product is designed to reduce the risk of endometrial hyperplasia and/or carcinoma; sales of the combination product "posted strong gains" in the U.K., Holland and Switzerland, the annual report notes. Wyeth-Ayerst also has started Phase II trials for a an orally- active nonsteroidal osteoporosis therapy (WY-47,766) for men and women. The 1991 introductions of the Norplant five-year contraceptive implant and the nonsteroidal anti-inflammatory drug Lodine (etodolac) added sales of $53 mil. and $109 mil., respectively (see box for prescription drug sales by product). Norplant was introduced in early February 1991 at a price to physicians of $350. The company is said to be working on a Norplant II product. With the recent additions of California and Massachusetts, Norplant is now approved for Medicaid reimbursement in all 50 states and the District of Columbia. Lodine, approved on Jan. 31, 1991, generated prescription volume of over 200,000 in its fourth month on the market, according to 1991 PDS prescription drug product data ("The Pink Sheet" April 6, p. 9). PDS dubbed Lodine the top new prescription product of 1991. Sales of Wyeth-Ayerst's older NSAID, Orudis (ketoprofen) improved by 38.9% to $125 mil. The company attributed the gain to "an increased marketing focus on its analgesic qualities and expanded use for primary dysmenorrhea." AHP is reported to have told securities analysts last March during its first public meeting with the financial community since 1986 that it was seeking to make an Rx-to-OTC switch for Orudis. The company also has an NDA pending for a once-a-day Rx version, Orudis SR, which it is predicting will be approved in 1993. Oral contraceptives remained Wyeth-Ayerst's leading product category (excluding infant formula). Sales of oral contraceptives were ahead by 8.7% to $602 mil., slightly above the previous year's growth rate of 7.7%. The strongest gains for the OC segment were contributed by Minulet, a low-dose monophasic registered in 53 foreign countries. Wyeth-Ayerst's previous projections for a 1991 NDA filing for Minulet did not materialize; the company now projects filing this year. The only other planned 1992 NDA filing is for Normiflo, a low molecular-weight heparin for the prevention of blood clots during hip and knee surgery. The company filed an IND for an oral formulation immunosuppressive agent, ropamycin, in February of this year. The IND for the I.V. was filed with FDA in April 1991.

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