Merck Goes Generic

Merck (MRK) announced that it will be pursuing a “follow-on biologics” program through its Merck BioVentures Division.  Merck is signaling that it plans to manufacture and sell generic versions of the most popular biotech compounds on the market.  

Merck is expecting it can demonstrate the bioequivalence of its products without having to conduct expensive Phase III trials.  If this turns out to be true, this generic strategy could prove very profitable for Merck.

But at what expense?  It is interesting that Merck, long known for its R&D capabilities, has chosen a path of emulation over discovery.  Is this a signal that pharma’s innovative future is winding down, or is this simply a smart way to capitalize on a unique opportunity?

Richard Clark: Merck, CEO

CEO/President/Director/Chairman of the Board

Merck & Company, Incorporated

Whitehouse Station ,  NJ

Sector: HEALTHCARE  /  Drug Manufacturers – Major

Officer since January 2000

 

61 Years Old

Richard T. Clark, Chairman of the Board (since April 2007), President and Chief Executive Officer (since May 2005), President, Merck Manufacturing Division (June 2003-May 2005) of the Company; Chairman, President (January 2000-December 2002) and Chief Executive Officer (January 2003-June 2003), Medco Health Solutions, Inc., formerly a wholly owned subsidiary of the Company Director, Project HOPE and United Negro College Fund; Chairman, Federal Health Care Legislation Committee of Pharmaceutical Research and Manufacturers of America; Trustee, Washington & Jefferson College and The Conference Board.

Has Pharma Lost its Heart?

 

Pfizer’s announcement that it was planning to discontinue its cardiovascular (CV) research and development program about a month ago sent signals throughout the life sciences industry that the rule of CV pharmaceuticals may be coming to an end.

 

Pfizer is the maker of the all-time largest blockbuster drug, Lipitor, which is used to lower cholesterol.  And although the drug has been a veritable cash cow, analysts expect its revenue generation to dwindle as it faces competition from generics.

That being said, Pfizer has chosen to pursue what it sees as more promising avenues of research focus such as neurology and oncology.

Major competitor, Merck, made a Saturday announcement “reaffirming” its commitment to CV development.  This release offered no real news to speak of, but comes at a time of pronounced uncertainty in the life sciences industry, where entire research programs are being scrapped.

Merck has definitively confirmed that they do not plan to follow suit in respect to Pfizer’s CV restructuring, as VP of Cardiovascular Clinical Research at Merck, Dick Pasternak, stated (pointing out the obvious), “… CV is still the number one killer.”

So, does Pfizer’s decision to bail out now indicate an isolated event, or will other companies (other than Merck) decide to leave their CV prospects undeveloped?