Pfizer Caduet Launch Set For May; Inspra Starts Slow

Pfizer will position the Lipitor/Norvasc combination product Caduet as an "upgrade" for the vast majority of hypertension patients, rather than focus on cannibalizing Norvasc, the company told analysts during an April 20 earnings conference call.

"The main purpose of Caduet is not really to cannibalize Norvasc," Pfizer said. "The main purpose of Caduet is to encourage physicians to treat two concomitant risk factors, hypertension and lipids, which are very rarely treated together."

Caduet (atorvastatin/amlodipine) was approved by FDA for use in patients needing simultaneous lipid-lowering and antihypertensive therapy Jan. 30 (¹ , p. 19).

Over 20 Mil. Potential Patients

Pfizer's rationale for the positioning of Caduet is tied to the results of the ASCOT study, which showed benefits from adding Lipitor to antihypertensive therapy in patients with normal or mildly elevated lipid levels. (Amlodipine was not the antihypertensive used in that trial.)

Pfizer estimates that there are 21 mil. patients with concomitant hypertension and dyslipidemia. Only 3% of that group are currently receiving concomitant Lipitor and Norvasc therapy.

"That is why cannibalization would not make sense," Exec VP Karen Katen said. Instead of concentrating on converting 3% of the patient pool, Pfizer is looking at the 97% who are "terrific candidates for an upgrade in therapy."

Pfizer will begin promoting Caduet in May, Katen said.

The product generated $28 mil. in stocking sales during the first quarter; Katen characterized the initial orders as "considerable" and "substantially more than our usual launch average."

"There seems to be considerable excitement and interest in the product, at least in the pharmacy community."

Caduet has considerable ground to cover to rival single-agent Lipitor or Norvasc as a contributor to Pfizer's overall performance. Lipitor first quarter sales were $2.5 bil. worldwide, while Norvasc posted $1.1 bil.

The healthy growth turned in by Lipitor, however, is probably a good sign for Caduet. After starting 2003 in the doldrums, the cholesterol-reduction market appears to be expanding rapidly.

Lipitor Helped By Bristol

Lipitor is now back on track to top $10 bil. in annual sales.

Total prescriptions increased by about 7% during the quarter, Pfizer noted, helped in part by publication of Bristol-Myers Squibb's "PROVE-IT" trial comparing Lipitor to Pravachol - and finding the Pfizer product superior (² (Also see "Statin Studies May Dampen Enthusiasm For Cost-Effectiveness Trials – AARP" - Pink Sheet, 15 Mar, 2004.), p. 10).

Katen credited PROVE-IT with boosting Lipitor's market share.

She cited the coverage of the study in The Wall Street Journal as well as the formal publication in The Journal of the American Medical Association as factors.

A Dry-Spell For Recent Launches

Nevertheless, Pfizer is banking on Caduet to reverse a recent trend of disappointing product launches.

In the late 1990s, Pfizer (and its copromotion partners) had a series of record-setting launches for products like Lipitor , Celebrex and Viagra . Apart from the Celebrex follow-on Bextra (sales of $270 mil. for the quarter), Pfizer's more recent new product introductions have not fared as well.

The antipsychotic Geodon (launched in 2001) posted $88 mil. in sales for the quarter, far short of the market-leading Zyprexa (over $1 bil.) it was intended to challenge.

The migraine agent Relpax (launched in 2003) saw sales decline from $32 mil. to $30 mil. worldwide during the quarter - and from $25 mil. to $16 mil. in the U.S.

Pfizer's most recently launched U.S. product, the congestive heart failure agent Inspra (eplerenone), posted no revenues during the quarter. Inspra was approved in 2003 and Pfizer launched the drug in January (³ (Also see "Pfizer Launches Inspra; Will Help Company Reach $54 Bil. In 2004" - Pink Sheet, 26 Jan, 2004.), p. 31).

Initial wholesaler stocking was $13 mil. in the fourth quarter. While "retail prescriptions are steadily increasing," Pfizer did not fill any new orders for the product at wholesale during the first quarter.

Inspra Is A "Niche" Product

Pfizer maintained that it expected Inspra to grow "very gradually," because the product is approved for use only in the subset of CHF patients with a recent myocardial infarction.

Pfizer noted that the total CHF population is much smaller than its other markets, with 5 mil. patients compared to over 50 mil. dyslipidemia patients.

In addition, because Inspra was studied in patients within two weeks of a myocardial infarction, "the pool of patients available at any one time is quite limited."

Finally, the process of driving hospital formulary acceptance and converting patients at discharge is "lengthy."

Katen maintained that any disappointment in Inspra's early results is because "the excitement about the science has confused some people."

"People are very excited about the science and having a medicine that works in this patient pool because obviously it has not been well treated," Katen said. "But it is still a limited population. It is more or less a niche market."

Katen maintained that awareness and use of the product is high: "about 25% of the cardiologists in the U.S. have reported using Inspra in at least some of their patients. But it is a limited number of patients."

Pfizer Rx Sales Top $11 Bil. In Quarter

Pfizer's quarterly earnings reports continue to redefine the meaning of scale in the pharmaceutical industry.

For the first quarter of 2004, Pfizer posted sales of $12.49 bil., including $11.04 bil. in pharma sales. The figures represent a 45% increase over Pfizer's pre-Pharmacia business a year ago.

To put that figure in perspective, Pfizer would rank in the top 10 of global pharma companies in annual revenues if it posted no further sales for the year.

Pfizer is not disclosing pro forma comparisons for its first quarter numbers, making it difficult to analyze the true underlying trends of the business.

One analyst asked about a steep sequential decline in sales between the fourth quarter and the first (about $1.5 bil.).

In part, the phenomenon is another indication of Pfizer's vast size. McKinnell responded by saying that Pfizer's first quarter is always lower than the fourth.

He acknowledged, however, that a decline in Viagra sales also contributed (see ⁴ (Also see "Viagra Scripts Rebounding, Pfizer Says; Will “Recreational” Users Return?" - Pink Sheet, 26 Apr, 2004.)).

Pfizer can also count on a period of earnings growth driven by continued cost-cutting from the recently completed Pharmacia acquisition and the 2000 Warner-Lambert merger.

Seven Plants Closed

The company highlighted one example of cost-cutting during the conference call: Pfizer reduced its global manufacturing base from 93 plants to 86 during the quarter, and the total "goes down every couple of months," CEO Hank McKinnell remarked.

However, as Pfizer closes in on the anniversary of the Pharmacia merger, the company is likely to face increasing pressure to demonstrate that it can continue to drive revenue growth on its huge base.

In addition to Caduet and Inspra, Pfizer is gearing up for the launch of the chronic obstructive pulmonary disease therapy Spiriva (also approved Jan. 30) in the middle of the year (⁵ (Also see "Pfizer/Boehringer Spiriva Clears FDA For COPD; Launch Set For Summer" - Pink Sheet, 9 Feb, 2004.), p. 18).

Beyond that, Pfizer has two NDAs pending with user fee deadlines in the second half of the year: the Neurontin successor Lyrica (pregabalin) and the ophthalmic agent Macugen .

Pfizer's Phase III HDL-raising agent torcetrapib is also beginning to generate excitement after the publication of Phase II results earlier in April.

After Pfizer presented a quick update on its pipeline at the start of the call, McKinnell concluded by declaring: "I guess research is back."