Combo Rx Product Market Potential Is Enhanced By Single Copay – Analysts

Combination drug products may have more market potential due to their copay advantage, sellside research analysts suggested April 1 at an IIR conference in Philadelphia.

Although "physicians don't like combination drugs, I think they are going to become a very big part of the armamentarium simply because of the copay," Lehman Brothers Managing Director Anthony Butler said.

One such example is Pfizer's Caduet , a combination of the company's lipid lowering agent Lipitor and its antihypertensive Norvasc , Deutsche Bank Managing Director Barbara Ryan said.

FDA approved Caduet Jan. 30 for the simultaneous treatment of high blood pressure and high cholesterol. Pfizer said it would launch the Lipitor/Norvasc combo tablet in April (¹ , p. 19).

"Medically it's a big yawn," Ryan acknowledged, "but in an environment where patients are increasingly sensitive about their copays," Caduet's single copay is an advantage over paying separate copays for both Lipitor (atorvastatin) and Norvasc (amlodipine).

For that reason, "I personally think that that's a much more commercial opportunity than people give it credit for by virtue of its 'medical importance,'" Ryan said.

The Deutsche Bank analyst noted that Caduet also provides hypertensive patients with the convenience of taking only one pill while bolstering their cardioprotective measures with a statin.

"Given the data that have come out, if you have a patient who has high blood pressure, then why not throw a statin in on top because it will be beneficial and they already have a risk factor for cardiovascular disease," Ryan said.

"So it's another way to throw a statin in the picnic basket. And the patient is taking one pill a day, which they have to take for hypertension," Ryan added.

Data from the Anglo-Scandinavian Cardiac Outcomes Trial showed cardiovascular benefits of Lipitor therapy for previously untreated hypertensive patients with normal- to mildly-elevated cholesterol levels (² (Also see "Lipitor Scripts Rebounding, Pfizer Says; Cholesterol Category Still Has Life" - Pink Sheet, 23 Jun, 2003.), p. 8).

Ryan maintained that the combination drug strategy may provide manufacturers with a better means of switching patients from agents whose patents are near expiration than the new formulation strategy.

"The formulation mode of extending patent life hasn't worked. It doesn't work in this environment where the price sensitivity is just too high and the incremental benefit is too low," Ryan commented. "So this becomes a logical next generation of that."

Ryan noted that "there are some of the exceptions" to the formulation rule, such as Pfizer's Procardia XL and GlaxoSmithKline's Wellbutrin XL , which were successful products.

Pfizer will likely utilize the switch strategy with Caduet, by getting Norvasc patients to switch to the combo product ahead of Norvasc's patent expiration in 2007.

Merck will likely employ a similar strategy with Vytorin , the Zetia/Zocor combination it will copromote with Schering. Vytorin (ezetimibe/simvastatin) is under review at FDA; the Zocor patent expires in 2006.

Manufacturers may hit a roadblock in relying on combination products to protect their agents from generic competition. A Washington, D.C. federal appeals court ruling found that combination products consisting of previously-marketed active ingredients are not eligible for a patent term extension (³ (Also see "Combo Drug Commercial Potential May Be Lowered By D.C. Court Ruling" - Pink Sheet, 29 Mar, 2004.), p. 29).

Butler predicted that the industry will "see many more of these combinations," in addition to approved combinations like Lilly's Symbyax (olanzapine/ fluoxetine) and GSK's Advair (fluticasone/salmeterol).

In November, Pfizer noted that incremental innovations such as new combinations are likely to be an important near-term focus for most big pharma companies (⁴ (Also see "Pfizer Stops Swinging For The Fences; Combo Products Are Big Opportunity" - Pink Sheet, 17 Nov, 2003.), p. 33).

Butler also predicted that combo products will continue to be developed for cardio/metabolic disease areas such as metabolic syndrome. "I have been very bullish on another Pfizer compound, Lipitor/torcetrapib, which is a drug that raises HDL," he said. Also on the horizon is "a PPAR alpha in combination with a statin where you're getting to the focus of arteriosclerosis."