The Death of the Blockbuster Drug

The Science Business – a healthcare blog
May 28, 2010
Matthew HerperBio
Matthew Herper is a senior editor at Forbes

Big drug companies used to ignore medicines that wouldn’t be prescribed to millions of patients. These days they seem to be unable to invent any.

Consider this: It has been four years since any company launched a real mass-market blockbuster, that is, a drug that generates billions of dollars in sales based on the fact that it’s widely used, not just expensive. The last big winner was Januvia, from Merck, which was launched in 2006 and now has annual sales of $1.9 billion. (The other contender would be Merck’s Gardasil vaccine, also launched in 2006.)

At the same time, drugs are losing sales to generics faster and more brutally than before. When we spoke to IMS Health about the most prescribed drugs in the country (all generic except Pfizer’s Lipitor, which goes generic next year) Murray Aitken, an IMS vice president, offered this stat. In 2003, 61% of drug sales were for a medicine for which a generic version was available. In 2009, it was 81%. Back in 2003, 84% of patients would get the generic. Now, thanks to tougher rules by insurers and drug companies, 92% of those prescriptions are filled with the generic version. All told, 74% of the market is now generic drugs, compared to 51% in 2003. That means more Teva, less Pfizer.

So far, the solution drug companies have hit upon is to find medications they can charge a lot for. Some can cost $400,000 a year or more. (See: The Most Expensive Drugs.) The question is, how long can that continue?



Author: Leslie Carol Botha

Author, publisher, radio talk show host and internationally recognized expert on women's hormone cycles. Social/political activist on Gardasil the HPV vaccine for adolescent girls. Co-author of "Understanding Your Mood, Mind and Hormone Cycle." Honorary advisory board member for the Foundation for the Study of Cycles and member of the Society for Menstrual Cycle Research.