Healthy Skepticism Library item: 8648

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Publication type: news

Edwards J.
Pfizer Taking Some Hits Over 'Billion-Dollar Bong'
Brandweek 2007 Feb 26
http://www.brandweek.com/bw/magazine/current/article_display.jsp?vnu_content_id=1003550010

Full text:

Drugmaker fails to record sales for device; ads put on hold.

Last year, Pfizer paid Sanofi-Aventis $1.4 billion for Exubera, a new inhaled insulin product for diabetics that Pfizer forecast would produce $2 billion in annual sales.

What Pfizer got for its cash was a device that looks a lot like a marijuana bong-and a brand that analysts, doctors, drug sales reps and some patients believe is a struggle to sell because it is so inconvenient to use.

And what was expected to be a dramatic blockbuster launch has turned into a bust, with repeated delays and negligible sales. Now, few observers outside Pfizer believe that Exubera can reach its $2 billion benchmark, a target the company repeated to analysts in January.

“I think Pfizer is on drugs” if it believes it will get $2 billion a year from Exubera, said David Kliff, publisher of Diabetic Investor, a specialist investment data company. If Pfizer does reach its goal, “I’m going to run down Madison Avenue naked,” he said. Kliff believes Pfizer will be lucky if Exubera ultimately does half the business the company is predicting.

The Food and Drug Administration approved Exubera in February 2006. The product looks like a plastic tube into which patients slip prepared doses of powdered insulin, the substance diabetics need to control their blood sugar. The device bursts the packet and a transparent chamber in the tube fills with a cloud of insulin. The patient then inhales the powder from the top of the tube.

A launch was expected in fall 2006, but that date came and went. In November, Pfizer told investors that an “expanded rollout” would happen in January.

On Jan. 22, Pfizer’s head of worldwide pharmaceutical operations, Ian Read, could only tell analysts that the consumer launch of Exubera would occur sometime in the “second half of ’07” and that consumers would see a “full-court press.” Pfizer last week declined to talk about the campaign; a call to its agency, Grey Healthcare, New York, was not returned.

Pfizer has declined to record total 2006 sales for Exubera, even though it does that for all its other drugs.

Analysts Friedman Billings Ramsey recorded only 881 Exubera prescriptions one week in January, a fraction behind the 15,000 needed for blockbuster status. Merrill Lynch, meanwhile, reported 824 new prescriptions has been written, and only 1,111 prescriptions in total. To put that in perspective, Pfizer has said it launched the brand with 2,300 reps touting the brand to 5,000 doctors specializing in diabetes, meaning that only a fifth of those doctors have persuaded a single patient to opt for Exubera.

By contrast, Merck launched a rival product, Januvia, in October 2006, and scrips for that are running in the 17,000 to 27,000 region. The difference: While Exubera is a bulky device, Januvia is a pill and has a side effect that makes patients lose weight.

How did Pfizer get into this mess?

One source familiar with Pfizer’s thinking prior to the launch said the company was relying on consumer research data that has turned out to be faulty in the real world. The data, this source said, indicated that new diabetics would be more likely to get treatment if they could avoid using needles, and that if a no-needle-inhalable device option was offered a large majority of consumers would ask for that. (Pfizer’s Read repeated that assertion in January.)

But, “they were overly optimistic,” the source said last week. Diabetics always want more options, but the source said their feeling about Exubera can be summed up as, “I wanted something new, but once I saw it I had second thoughts.”

One possible reason is the device’s odd appearance, which Pfizer has not talked about much. Amy Tenderich, who writes the Diabetes Mine blog, recently commented on an online video from Pfizer showing a man huffing on his Exubera tube at a restaurant table. The man “must live in a city as tolerant or as jaded as San Francisco or New York, because not one patron even glanced over as he cocked and sucked on his medicinal bong.”