Merck Reports – Imagine the possibilities
Each time Merck (NYSE:MRK) reports earnings, as they did this morning, Diabetic Investor is amazed that a lackluster drug like Januvia and its sister drug Janumet (A combination of Januvia and metformin) has reached has reached blockbuster status. In 2009 the two drugs combined for almost $2.6 billion in sales and neither shows any signs of slowing down.
The fact is the Januvia franchise is perhaps the luckiest diabetes franchise in the world. The drug came to market just as the world was learning about cardiovascular issues with the then top selling diabetes drug, Avandia. Its major competitor Galvus stalled at the FDA while Amylin (NASDAQ:AMLN) and Lilly (NYSE:LLY) were busy screwing up the launch of Byetta. Simply put Januvia could not have some to market at a better time under ideal market conditions. Merck, desperate for a hit, didn’t miss their opportunity and the rest, as they say, is history.
What’s truly amazing is not the sales numbers but just how desperate physicians are for drugs to treat type 2 diabetes. The fact is Januvia used as a monotherapy is a rather lackluster drug and the real improvements come only when used in conjunction with metformin. Yet, even with its unimpressive profile the Januvia franchise sales success is undisputed.
The success of the Januvia franchise makes Diabetic Investor wonder what the sales numbers would look like if you actually had a drug that worked well. A drug that actually helped patient’s achieve better glucose control had a reasonable adverse event profile and was patient/physician friendly. This is the true Holy Grail in the diabetes drug arena.
The fact is in today’s world such a drug may not be possible. Not when you have an FDA that seems focused on reasons not to approve new diabetes medications. Not when you have researchers conducting meta-analysis’s that can make any drug’s adverse event profile seem unacceptable. Not when the leading thought leaders themselves look at study data and reach very different conclusions.
The reality is when it comes to the diabetes market whether it’s drugs or devices; it’s an all out war for market share. And as Socrates noted; “Wars are occasioned by the love of money.” While there have many solid strides made in the treatment of diabetes the fact remain that nearly two-thirds of all patients are not achieving control. Given this fact it’s safe to say that the casualty of this war has been the patient with diabetes.
Diabetic Investor has no problem with Merck taking full advantage of their many lucky breaks with Januvia. To their credit Merck took full advantage of this lucky streak and has made it nearly impossible for the competition to gain even a sliver of market share. However, when a lackluster drug like Januvia achieves blockbuster status it does send the mind wondering what it would be like if a truly good drug came along. Imagine the possibilities.
