A steep challenge awaits the winning agency: how to market the new hormone replacement drug against American Home Products Corp.'s Premarin, a 55-year-old competitor that doctors rely on seemingly as much as stethoscopes.
Pharmacia, the company formed by the merger of Pharmacia & Upjohn and Monsanto Co., could make a decision this week for the estimated $20 million to $30 million account. The three finalists for the business are Merkley Newman Harty Healthworks, Lowe Consumer Healthcare and Medicus, all New York.
Pharmacia reached an agreement in January with Activella's developer, the Danish company Novo Nordisk A/S, for the rights to market the drug in the U.S. The product is expected to be ready for distribution sometime in June, with a DTC campaign to follow before yearend.
Activella was approved by the U.S. Food & Drug Administration in November 1998 to treat menopausal symptoms; and it has taken well more than a year for it to be readied for market. (Earlier this month, Activella also received FDA approval to help ward off osteoporosis.) Part of the delay was apparently caused by Novo Nordisk A/S' search for a U.S. marketing partner with the clout to help the drug become a player in the hormone replacement therapy market dominated by Premarin.
FIGHTING THE LEADER
One of the top-selling Rx drugs of all time, Premarin is well-established as physicians' first choice to treat menopausal symtoms such as hot flashes and night sweats. Premarin posted more than $1 billion in U.S. sales last year, according to consultancy IMS Health.
"It will prove very difficult to compete against the extremely well-established" Premarin and its sister drugs, said Neil Sweig, an analyst with Ryan, Beck & Co.
Last year, Duramed Pharmaceuticals found out just how hard it can be. The company introduced Cenestin, which it positioned as a biologically correct alternative derived from a plant base -- as opposed to the urine of pregnant mares, in the case of Premarin.
Duramed said it expected to generate $100 million in sales in the product's first 15 months. Instead, IMS Health figures show Cenestin posted $3.8 million in sales in nine months last year, barely more than half the estimated $7 million Duramed spent on a print campaign to support the drug.
A Pharmacia spokeswoman acknowledged the potential pitfalls, but said the menopausal-symptom market is growing as baby boomers age and has become sizable enough for Activella to find a profitable niche.
MEETING A CHALLENGE
"Any time there's a market with a clear-cut leader, it's a challenge," she said. "But more and more women are reaching menopause, and it's a large market."
In addition, she said, there are 40 million to 50 million American women going through menopause and "some are unhappy" with their current treatments.
IMS Health figures show U.S. doctors wrote more than 47 million prescriptions for Premarin last year.