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JANSSEN WILL COMPROMOTE SMITHKLINE BEECHAM’s PAXIL

Executive Summary

JANSSEN WILL COMPROMOTE SMITHKLINE BEECHAM's PAXIL antidepressant to U.S. psychiatrists beginning "some time in the next several months," the Johnson & Johnson subsidiary said May 13. Under the agreement, SmithKline Beecham will copromote Janssen's antipsychotic Risperdal (risperidone) to psychiatrists in the U.S. when that drug receives FDA approval. Janssen's copromotion of Paxil (paroxetine), a serotonin reuptake inhibitor, will not wait for FDA approval of Risperdal, the companies said. SmithKline Beecham has been promoting Paxil to psychiatrists and general practitioners with its U.S. sales force since the drug's Feb. 1 launch; the product was approved by FDA Dec. 29 ("The Pink Sheet" Jan. 4, p. 6). Risperdal, a dopamine and serotonin blocker, received a unanimous approval recommendation from FDA's Psychopharmacologic Drugs Advisory Committee April 29 ("The Pink Sheet" May 3, p. 12). The agreement will help Janssen to differentiate Risperdal from J&J's older anti-psychotic Haldol (haloperidol), which is marketed by J&J's Ortho and McNeil sales forces. For SmithKline Beecham, the deal adds marketing muscle to a product for which SB has high commercial hopes. SmithKline Beecham has not been directly active in the U.S. psychiatric market since it transferred its 75-person psychiatric sales force to a partnership with Nova in April 1990 ("The Pink Sheet" April 30, 1990, T&G-10). Paxil, the third serotonin reuptake inhibitor launched in the U.S., was introduced at a 12.6% discount to Lilly's Prozac (fluoxetine) and a 3.6% discount to Pfizer's Zoloft (sertraline). SmithKline Beecham said in April that Paxil has been accepted by 70% of all U.S. managed care organizations, possibly a further reflection of the company's willingness to discount the product in return for market penetration. Along with price discounting and the assistance of the Janssen sales force, Paxil labeling claims concerning long-term efficacy could also help the drug compete in the serotonin reuptake inhibitor class. Paxil labeling states that the drug has been shown to prevent relapse in depressed patients in a one-year study. Zoloft and Prozac labeling contain information on 16 weeks of treatment and six weeks of treatment, respectively. At the Alex. Brown & Sons health care seminar in Baltimore May 11, SmithKline Beecham Chairman Robert Bauman hinted at the May 13 copromotion deal with Janssen, saying: "We will be looking for arrangements for copromotion with other people." He indicated that copromotions could be a cost-effective way to promote new products without adding more reps. Asked if the company will reduce its U.S. sales force as managed care drug buyers become more predominant, he said that SmithKline Becham has not increased its sales force for "over a year and a half" and "we have no intention of adding to our medical rep forces." Bauman noted that despite the growth of managed care, "you still need to go first to physicians, [which] I believe we will in the future do more efficiently." The copromotion agreement is the first between SmithKline Beecham and Janssen in the U.S. In Germany, SmithKline Beecham copromotes Janssen's gastric motility agent Propulsid (cisapride) in return for Janssen's comarketing of Seroxat, the European brand name for Paxil. Propulsid is pending approval in the U.S. SmithKline Beecham copromotes Merk's cholesterol-lowering drug Zocor (simvastatin) in the U.S. under an agreement announced when the drug was approved in December 1991 ("The Pink Sheet" Jan. 6, 1992, p. 3). Under that agreement, Merck will copromote an unnamed SmithKline Beecham product in the U.S. On May 14 SmithKline said the drug to be copromoted by Merck "has not yet been worked out" and suggested that the chosen drug may be a product that has not yet been approved.
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