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Biotech / Medical : PFE (Pfizer) How high will it go? -- Ignore unavailable to you. Want to Upgrade?

To: Solid who wrote (5014)	8/19/1998 5:12:00 AM
From: Anthony Wong	Read Replies (3) \| Respond to of 9523

The London Times: UK to earn œ100m from Viagra sales August 17 1998 BY PAUL DURMAN THE Government is set to earn œ100 million a year in tax revenues from the worldwide sales of Viagra, the impotence treatment developed in the Kent laboratories of Pfizer, the American pharmaceuticals company. As the drug was a British discovery, the patent for Viagra is held by Pfizer Limited in the UK, which will receive a royalty of about 10 per cent on all sales. With sales forecast to reach $5 billion (œ3 billion), Pfizer Limited's income from the blue pills could incur an annual tax charge of œ108 million, based on the same 35 per cent tax rate it paid last year. The tax income from Viagra will offset the cost of the drug to the National Health Service, which doctors at last month's meeting of the British Medical Association suggested could be œ1 billion or more. This would impose an unbearable strain on the total NHS drugs budget of œ5.5 billion. The widely publicised estimate has prompted calls for Viagra to be rationed, making it available only through consultants and urologists. Pfizer is privately alarmed by the œ1 billion estimate, which it claims is much too high. In lobbying the Department of Health and the drug-pricing authorities, the company is arguing that demand will turn out to be much more modest - partly because of the conservatism towards new drugs among the patient population in Britain, and the continuing reluctance of men to admit to having impotence. It is believed that only a handful of existing drugs cost the NHS as much as œ100 million. Glaxo Wellcome's Imigran for migraine is believed to claim the biggest slice of the cake, but its UK sales are only about œ200 million. Tight controls on Viagra's availability on the NHS will encourage GPs to offer the drug on private prescription, requiring patients to pay perhaps œ5 a pill. Pfizer is sponsoring a new course to teach doctors how to diagnose and treat impotence, and to identify genuine sufferers. It is already possible for patients to ask their doctors for private prescriptions for medicines not readily available on the NHS. However, government endorsement of such an approach to offset the cost of Viagra is likely to lead to accusations that it is fostering a two-tier health service. Doctors are concerned that the publicity surrounding Viagra will encourage many men to take Viagra to improve their sexual performance. Despite widespread enthusiastic reports from healthy users, Pfizer insists there is no evidence to suggest the drug offers any benefit to "normals", and that it is not an aphrodisiac. Viagra is expected to receive its UK licence within the next month or two. Already the fastest-selling drug ever launched in the US, the pill is also readily available over the Internet. On current estimates, Viagra sales will reach $1.5 billion in 1999, its first full year in most major markets. That will generate an estimated œ100 million of royalties for Pfizer in the UK, and produce perhaps œ30 million in tax for the Inland Revenue. It will take another few years for the drug to reach its peak sales. More conservative estimates of sales and Pfizer's tax liability still suggest annual tax revenues of more than œ50 million. Separately, it has emerged that Pfizer has been approached to sponsor an exhibition within the "Body Zone" - the androgynous figure that is the centrepiece of the Millennium exhibition at Greenwich.