Among the three leading new anticoagulants, Xarelto and Pradaxa are charging ahead in sales, while Eliquis is merely crawling.
Johnson & Johnson (JNJ) and Bayer's (OTCPK:BAYRY) drug Xarelto generated $246 million in sales (JNJ's share) in the third quarter, while sales of Eliquis from Pfizer (PFE) and Bristol-Myers Squibb (BMY) were $41 million for the same period.
The huge expectations that analysts had for Eliquis as a potential blockbuster have not been justified so far, although it must be said that Eliquis was launched recently and the other two have been around for a couple of years.
According to EvaluatePharma data, analysts' consensus for Eliquis sales for 2014 has fallen 60 percent in the last 12 months, and in early October it stood at $491 million. Estimates for Johnson & Johnson and Bayer's Xarelto have surged at the same time. Xarelto's sales estimate for 2014 now stand at $1 billion for J&J and and $1.4 billion for Bayer. (JNJ markets the drug in the U.S. and Bayer everywhere else.)
The dark horse in the race is Pradaxa, made by the privately held German company, Boehringer Ingelheim. Pradaxa generated $201 million in the 3rd quarter in the U.S. alone but the drug has been on the market for almost 3 years. J&J management also claims that according to U.S. prescription data Pradaxa has been losing market share since the arrival of Xarelto and that demand for Xarelto is still climbing.
These newer drugs are supposed to succeed Plavix, one of the largest selling brands of all times and replace inconvenient warfarin which is still widely prescribed. The race is heating up and the participants have different strengths and weaknesses.
Convenience: Dosing is a factor favoring Xarelto. While both the Eliquis and Pradaxa pills need to be taken twice a day for stroke prevention, Xarelto is a once daily medication. Some analysts think this fact alone can provide Xarelto with an edge. Patients needing blood thinners are usually on several other drugs and once daily dosing can improve compliance. But convenience is not necessarily a deciding factor in choosing a drug.
Broad label: Xarelto has a broad label, the widest of all three, with seven approved indications. Pradaxa and Eliquis are only approved in stroke prevention in the U.S. Xarelto's U.S. approval include stroke prevention in non-valvular atrial fibrillation, treatment of DVT (deep vein thrombosis), treatment of PE (pulmonary embolism) and reduction of the risk of recurrent DVT and PE.
Superior performance: According to its FDA approval, Eliquis is superior for atrial fibrillation on three key aspects: superior stroke prevention, reduced major bleeding and reduced all-cause mortality. With its superiority in preventing hemorrhagic strokes, Eliquis has the clear lead in terms of safety.
Eliquis and Pradaxa are both better than warfarin in preventing stroke. Only Eliquis, however, has reduced major bleeding over warfarin and improved mortality. The Institute for Safe Medication Practices (ISMP) in its October 2013 report placed anticoagulant drugs at the top of the list of serious adverse events reported to the FDA, with Pradaxa leading the pack.
Market share: According to a Bayer conference call presentation, Xarelto's overall market share in the U.S. currently is around 28 percent. But the rate is higher in the new prescriptions segment provided by cardiologists where it reaches 38 percent.
Eliquis is doing quite well in the atrial fibrillation segment of the business, having reached about 20 percent of the U.S. market. But its overall market share is still only about 4 percent in the U.S., and even lower in foreign markets; in Germany 3 percent, in the U.K. 1 percent, and in Japan 1 percent, where Xarelto has recently jumped from 9 to 24 percent.
The FDA approved Xarelto in 2011. Xarelto's sales have more than tripled in the third quarter of 2013 compared with the same quarter last year and grew nearly 30 percent from the second quarter. In the first 9 months of 2013 J&J sold $593 million worth of the drug which compares to $144 million in the same period of 2012. J&J resubmitted Xarelto's application to reduce the risk of secondary cardiovascular events in patients with ACS (acute coronary syndrome) and a decision is expected in mid-February.
Xarelto is popular among cardiologists who like to prescribe it to new-to-brand patients. Physicians prefer the breadth of its data from clinical trials. The competition just doesn't have the breadth of data that Xarelto has, the company claims.
Eliquis was approved by the FDA in 2012. The drug is co-marketed by Bristol-Myers and Pfizer and the partners book 50 percent each of the profits from the joint venture. After a slow launch, prescription trends are improving and the third quarter showed consistent weekly growth. As an important leading indicator, the new-to-brand share has improved and it now stands at a nearly 20 percent rate with cardiologists.
Eliquis came third to the market, and found that two other agents were already entrenched. One competitor's claim to fame is that they were the first, the other one claims convenience. Eliquis' claim is superiority in certain aspects of the therapy, supported by solid clinical trial data.
Bristol is changing the marketing strategy for the drug, focusing on presence in hospitals. Hospital presence is a promising avenue but to build it up is time-consuming: it requires expensive stocking of the drug, educational courses for doctors and major advertising campaigns. The company has increased its advertising and promotion budget by 16 percent to $194 million and much of the money is geared toward promoting Eliquis and the diabetes portfolio. Direct-to-consumer campaigns and television ads already started, and they will have an impact over time.
Bristol claims that Eliquis' share in the NBRx segment of new prescriptions which include new-to-therapy patients, add-ons and switches for existing patients, is now close to 19 percent, compared to 12 percent for Pradaxa.
Eliquis has been launched in 13 countries in Europe, four more to follow soon. Europe is an important market because the drug is used mainly in hospitals and so it favors the marketing strategy. The hospital environment is a good starting point to generate acceptance since the drug becomes part of the discharge prescription package for patients. Medical education courses for cardiologists and general practitioners are also organized.
Pradaxa was the first approved among the newer anticoagulants, introduced in the U.S. in 2010. The company is privately owned, therefore sales forecasts are not available.
Boehringer Ingelheim reported worldwide Pradaxa sales of 612 million euros (approx. $831 million) in the first half of 2013, which represents a currency-adjusted increase of 27.9 percent from the same period of the previous year. This 27.9 percent growth follows a sales jump of more than 76 percent between 2011 and 2012, when the drug reached blockbuster status with $1.1 billion in sales.
Finding an easy and quick antidote to stop emergency bleeding in patients is of vital interest for all 5 companies in the race. The new drugs represent an easier and safer way to fight blood clots compared to the difficult-to-administer warfarin, the main disadvantage is the risk of bleeding. Warfarin has a quick-acting antidote for bleeding, vitamin K, Xarelto and its peers do not have one yet.
But efforts are under way to develop one.
Portola Pharmaceuticals (PTLA) of South San Francisco, in contract with all the majors except Boehringer, is testing andexanet alfa (previously called PRT4445), an agent that may be able to counteract heavy bleeding. If it works and approved, doctors may be more willing to switch their patients from warfarin to one of the new drugs.
Boehringer is also working on an antidote developed in-house. Success could not come soon enough as Pradaxa is being blamed for more than 1,000 deaths from bleeding around the globe and lawsuits are piling up. Boehringer, on the other hand, is quick to point out that instances of severe bleeding in Pradaxa patients are still less common than in warfarin patients.
In the third quarter J&J had sales of $17.6 billion, representing an increase of nearly 5 percent versus the third quarter of 2012. Earnings per share, excluding special items, were $1.36 per share, or a nearly 9 percent increase. Special items, mainly litigation related charges, amount to about $.032 per share.
Pharmaceutical sales grew by 11 percent in the quarter, driven mainly by sales of the brands Invega, Sustenna, Remicade, Simponi, Stelara, Velcade and Prezista and new products like Xarelto, Invokana, and Zytiga. Zytiga is now a blockbuster that has well exceeded $1 billion in global sales this year.
At the end of the third quarter J&J had approximately $10 billion of net cash. This consists of $25 billion of cash and marketable securities and $15 billion of debt. Sales for 2013 on a constant currency basis are projected in the range of $71.3 to $71.9 billion. EPS is expected to come in between $5.44 and $5.49 per share excluding the impact of special items.
Xarelto's sales curve demonstrates what Johnson & Johnson's marketing muscle can do for a brand. Xarelto was launched as a second in the line of newer anticoagulants, at the time barely distinguishable from the others to the casual observer, but look at it now, just two years later: it is well on its way to become the leader of the pack.