$40 million budget: Future of failing FluMist in doubt

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It's kill or cure time for Flu Mist.

Staggered by disastrous results of their co-marketed nasal vaccine FluMist, Wyeth Pharmaceuticals and MedImmune will next month decide the fate of the product, one of the most celebrated and costly product flops in recent history. "Everything is on the table," said MedImmune CEO David M. Mott.

MedImmune will announce its financial guidance for 2004 and its long-range plans for FluMist on a March 1 conference call.

Options include dissolving the marketing partnership with Wyeth, leaving one of the drug makers to go it alone; dropping Publicis Groupe's Saatchi & Saatchi, New York, as FluMist's agency of record; keeping Saatchi but changing how the product is marketed; or "declaring defeat and getting out."

`evaluating'

Asked if Saatchi & Saatchi was still the agency of record for FluMist, Wyeth spokesman Douglas Petkus said: "All I can say is we are currently evaluating the promotion of FluMist."

Tom Lom, newly appointed president of Saatchi & Saatchi Consumer Health Care, declined to comment.

Observers, however, fault the product rather than the advertising. Not even a shortage of flu shots in December could salvage FluMist and after a brief spike in sales, FluMist returned to its abysmal levels.

MedImmune, which handles distribution, delivered 4 million doses of FluMist to Wyeth last year. Only 830,000 were sold, according to the company, meaning more than 3 million doses will soon be destroyed, since the vaccine must be reformulated each flu season. Wyeth said it took a $20 million charge to write off the unsold stock. The company announced last month it was eliminating 1,000 jobs and closing two manufacturing plants.

MedImmune attributed its 9% drop in fourth-quarter 2003 profits to FluMist's disappointing sales. While MedImmune made $46 million off FluMist, almost all of it came in the form of a payment from Wyeth as its marketing partner.

Whatever the reason for the dreadful sales, few are ready to pin the blame on Saatchi. Given more than $40 million to work with-measured spending through October of 2003 according to TNS Media Intelligence/CMR was $28 million-the agency last fall churned out a comprehensive campaign that centered around the numerous missed days of work and school caused by the flu.

"I don't know if you can blame this on the advertising," said an executive from one of the two drug makers. "It was a good concept. Basically, almost every adult works and almost every kid goes to school, so you're marketing to the right people."

The marketing may have touched the right people, but the product couldn't. FluMist is only for patients between the ages of 5 and 49, leaving out the two age groups most at risk for catching the flu-toddlers and senior citizens. Moreover, it cost an average of $46 a dose, more than three times the average of a traditional flu shot.

wider age range

A Wyeth exec VP said the company will lobby the Food and Drug Administration to market the vaccine to a wider age range, and may also lower the cost of the vaccine, a signal, perhaps, of what the March 1 announcement might entail.

For Saatchi, promoting a medication for the flu doesn't appear to be in the cards. In 1999, GlaxoSmithKline launched Relenza with a campaign from Saatchi that featured Wayne Knight, a.k.a. "Newman" from the hit TV series "Seinfield."

Like FluMist, Relenza bombed. It was never indicated for the prevention of flu, which hurt sales. It was a powder that needed to be inhaled through a plastic device that patients found difficult to operate. And it later came with a warning on the label, at the FDA's request, saying that the drug shouldn't be taken by those with asthma and other respiratory problems.

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