Vertex's PI will probably have two advantages. First, they are claiming that it will have the best safety profile, but this remains unproven in the literature. Secondly, more analysts seem to be following this stock.
On the other hand, Glaxo will be selling the drug worldwide, so Vertex will only receive royalties, making them less profitable than AGPH.
The question is how of Glaxo's sales force will be used. Merck and Roche have only allocated a small percentage to selling AIDS drugs because only a small percentage of physicians do the actual prescribing. That is, currently all have about 150 people.
The second question is how will physicians position all the options. Merck will probably retain the largest market share because of cost. It will remain first line therapy. Probably 60+% of patients will start with theirs, but half of these will switch due to safety and efficacy problems.
Thus, in the first round, the other 4 companies will share the remaining 40% of the market.
On the other hand, the biggest part of the market will be chronic therapy. Assuming that combo therapy become widely accepted, Viracept should hold 50% of the remaining market. That is, 50% of the 50% that have problems with the single therapy. They should also have 5% of the single therapy market.
Thus the market shares should look something like:
Merck- 35%
Agouron- 30%
Roche, Abbott, Glaxo- 5-10% each
From a profitablity perspective, Merck gets to keep all their profits. Roche keeps all of its profits plus a sixth (approximately) of Agouron's. Agouron keeps 2/3 of its profits with the remaining going to Roche and Japan Tobacco. Vertex keeps half with the remaining going to Glaxo. Thus, I still see AGPH being 4 times as profitable as Vertex.
How's it go, "You can't tell the players without a score card." |
