lifted on wsj
"Rezulin is likely to see flat sales until June" when competing drugs are
likely to be approved "and then a decline after that," says Jack Lamberton
of HSBC Securities. He added that the Rezulin vote "is all good news" for
SmithKline Beecham PLC and Eli Lilly & Co. Those companies are
awaiting approval for similar drugs that may have a lower incidence of
side-effects.
Until reports of Rezulin's side effects became big news last year,
Warner-Lambert could seemingly do no wrong. Its earnings have risen
explosively because of the rapid growth of its cholesterol-lowering drug,
Lipitor, and the popularity of Rezulin, which was approved by the FDA in
1997. In 1998, Lipitor sales rocketed to $2.2 billion, while Rezulin posted
sales of $748 million.
"Warner Lambert has been a one-and-a-half product company," Mr.
Lamberton said. "Now it's a one product company." Industry analysts had
expected Rezulin to eventually produce $1 billion to $2 billion in annual
sales, and many of them now think the bulk of that market will go to the
new drugs from SmithKline and Lilly if studies show they have a
significantly lower risk of side effects.
Still, the outcome of the hearing is likely to produce some relief to
Warner-Lambert shareholders, as the panel could have recommended
even more severe restrictions. Currently it is recommended that patients
receive monthly liver tests for the first eight months of therapy. The panel
could have recommended requiring proof of the blood tests before
prescriptions could be filled.
Warner-Lambert officials said they were pleased with the panel's vote and
that the company was working on ways to improve the drug's safety. The
company has already started mailing monthly reminders to patients to get
their blood tested for elevated liver enzymes, a sign of liver problems.
A company spokesman would not comment on analysts' sales estimates
for the drug, but he said that the company "is not a one-product company."
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