AstraZeneca, Pfizer And Merck/Schering-Plough
Overwhelm All Competitors With Promotion Of Their Cholesterol Reducers In The
Wake Of Generic Introduction In The Class, Cognet-X Inc. Reports
FEASTERVILLE, PA (Aug. 24, 2006) – Acting against the double threat posed by new generic competitors, AstraZeneca, Pfizer and Merck/Schering-Plough– joined in a high-stakes promotional battle for preferred status on U.S. health plan formularies during 2Q06.
At the close of the quarter, Crestor, Lipitor and Vytorin, respectively, overtook all competitors to become the three most-promoted products to leading managed care pharmacy executives, according to Cognet-X’s PAR-Rx (Promotional Assessment Research) Report™. These decisionmakers have the ability to influence which drugs are reimbursed by health plans that represent millions of Americans across the country.
At stake for brand and generic manufacturers alike: market share in the multi-billion-dollar anti-cholesterol category.
Thus, contracting was front and center as the leading cholesterol-lowering brands competed for coveted “preferred” formulary designation. Generic versions of Bristol-Myers Squibb’s Pravachol and Merck’s Zocor both hit the marketplace in 2Q06.
But while AstraZeneca, Pfizer and Merck/Schering-Plough all sought agreements with their managed care customers, feedback from PAR-Rx panelists showed the companies took different approaches to contracting.
With market share in the cholesterol-reducing class Lipitor’s to lose, Pfizer used contracting both as a carrot and a stick. PAR-Rx panelists reported that the company offered attractive terms for exclusive preferred formulary position while removing incentives for less-favorable status:
“More aggressive terms offered for Lipitor in exchange for exclusivity; additional 5%.”
“Have removed rebates for formulary position of Lipitor.”
“Unwilling to continue rebates at 2nd tier.”
Second-quarter product discussions for Crestor indicated that AstraZeneca took a flexible approach to contracting:
“Contract available if Crestor is second step after generic simvastatin pass-through.”
“Rebates for 2nd tier access.”
“Very proactive in the approach to generic Zocor.”
In support of Vytorin, Merck/Schering-Plough offered incentives for both exclusive and unrestricted formulary access:
“Improved rebates for exclusive branded statin at second tier.”
“Will increase rebates if take prior authorization off. Don’t think we will do.”
“Effective 7/1/06 this product will be on Tier 2 with no PA.”
Adding to this competitive mix in the second quarter was Merck’s counterintuitive strategy of rebating branded Zocor in an effort to displace Teva’s generic version from Tier 1, generally associated with health plans’ lowest co-pays. This drew mixed reviews from PAR-Rx pharmacy executives:
“Move branded Zocor to Tier 1. Great proactive move by Merck resulting in significant savings for our clients.”
“You have to admire Merck for creativity but I’m concerned that they are undermining the generic product system.”
And, though cholesterol reducers were the big story during the second quarter, other brands also were heavily promoted.
Tied for fourth most-promoted were Novo Nordisk’s long-acting basal insulin Levemir and Daiichi-Sankyo/Forest Pharmaceuticals’ antihypertensive Benicar. Ortho Biotech’s Procrit, an anemia treatment, followed in fifth place.
About the PAR-Rx Report™
Cognet-X’s PAR-Rx Report is a quarterly service that provides pharmaceutical, biotech and Wall Street clients with timely, actionable competitive intelligence and analysis related to pharmaceutical/biotech company promotion to influential managed care pharmacy executives.
About Cognet-X
Cognet-X is a privately held, employee-owned healthcare
research, consulting and software development firm based in Bucks
County, PA. Our focus is on providing and developing
business intelligence solutions centered on the managed care marketplace for pharmaceutical
and biotechnology companies. For more information about the PAR-Rx Report™ or
other Cognet-X products and services, please contact:
Contacts
Rick Bourland
Executive Director, Sales & Marketing
215-396-8300, ext. 103
rickb@cognetx.com
Sharon Bender
Executive Director, Strategic Inititiatives
215-396-8300, ext 148
sharonb@cognetx.com
