Pfizer, Astellas settle Lipitor sales disagreement
Last Updated: 2007-01-26 10:00:15 -0400 (Reuters Health)
By Edwina Gibbs
TOKYO (Reuters) - Pfizer Inc. and Astellas Pharma Inc. on Friday buried the hatchet over Pfizer's top-selling Lipitor, with Astellas winning its argument that its sales contract for the cholesterol-lowering drug runs until 2016.
The two companies also gained approval from Japan's health ministry to market arthritis treatment Celebrex, the first time a medicine from the controversial class of COX-2 pain relievers has been approved in Japan.
The Lipitor settlement removes a large downside risk for shares in Japan's third-biggest drug maker. Pfizer had asserted that Astellas' contract for Lipitor, which is the world's best-selling drug with annual sales of more than $12 billion, only ran until 2011.
It also comes amid deep job cuts by Pfizer, the world's biggest drug maker, which include the closure of a research site in Nagoya, central Japan.
"I think Pfizer probably decided that with all this restructuring, it was not the time to be fighting a lawsuit and alienating a business partner," said Takumi Yamagishi, senior drugs analyst at Shinko Securities.
Yamagishi said the Lipitor announcement would help Astellas' shares rebound after they plunged 5 percent on Wednesday on delays in approval for a new formulation of its Prograf immunosuppressant drug.
U.S. authorities said they could not yet approve it for heart transplants and raised questions about its use in kidney and liver transplants. Most analysts said that while the news was negative, the market had overreacted.
Astellas shares gained ground on Friday, closing up 1.4 percent at 5,120 yen, but are still 4 percent lower than levels prior to the Prograf news. The Lipitor announcement came after the market close.
CAUTION ON CELEBREX
Astellas and Pfizer said that Celebrex, which will be called Celecox here, has been approved for the treatment of rheumatoid arthritis and osteoarthritis.
But heightened scrutiny of COX-2 inhibitors after the class was linked to an elevated risk of heart attacks and strokes, has analysts uncertain about the drug's prospects.
"I think Japanese doctors are going to be very cautious towards using COX-2 inhibitors and it is also going up against Loxonin, a very popular drug from Daiichi Sankyo," said Yamagishi.
The Japan approval came four years after the application was submitted, around double the normal amount of time, reflecting safety concerns.
Celebrex is the only COX-2 inhibitor drug still on the U.S. market. Merck & Co. Inc. pulled Vioxx in 2004, citing a study that found prolonged use doubled the risk of heart attack and stroke. Pfizer, the world's biggest drug maker, withdrew another COX-2 inhibitor, Bextra, in 2005.
Pfizer's Japan unit estimates the Japan market for anti-inflammatory and pain relief treatment for rheumatoid arthritis and osteoarthritis at around 15-20 billion yen ($125-165 million) annually.
Yasuhiro Nakazawa, senior analyst at Mitsubishi UFJ Securities said that if Pfizer and Astellas also won approval for Celebrex's use to treat shoulder and back pain, then peak sales could reach 20 billion annually.
But it could take the companies 6-7 years for sales to peak as they would likely take a non-aggressive approach to marketing, he added.
By comparison, Daiichi Sankyo Co. Ltd.'s anti-inflammatory treatment Loxonin garners nearly 30 billion yen in domestic sales annually.
Separately Astellas announced it had also won Japan approval for its anti-fungal drug Funguard to be also used in blood stem cell transplants, which include bone marrow transplants, and for Prograf to be used to treat lupus nephritis, a kidney disease.
