The impact of Pfizer's abrupt termination of its high-density lipoprotein booster torcetrapib has been reverberating around the pharmaceutical industry, and the effects have been felt not least on the New York firm's share price.
The news of the decision to stop all clinical trials of torcetrapib due to safety concerns was announced on Saturday, but on Monday investors had their say and sent Pfizer stock tumbling almost 11%, wiping out over $21 billion of its market value. Most of the major brokers were also severe in their judgements, with Deutsche Bank, Lehman Brothers, Morgan Stanley, Merrill Lynch and JP Morgan all cutting their ratings on the stock.
Speculation is now growing as to what Pfizer is going to do next in order to plug the gaping hole in its pipeline left by the axing of torcetrapib. Investors have been impressed by the company's programme of major cost-cutting but Pfizer has never been off the acquisition trail for long and a bid to shore up its pipeline with either a new product or a whole company seems highly likely. Wyeth has been mentioned as a potential target.
Rivals revel in Pfizer woe
Pfizer's pain has provided plenty of pleasure to its rivals in the cholesterol market. Analysts at Morgan Stanley said the termination of torcetrapib was an "important positive" for AstraZeneca since it had been perceived as the biggest potential competitor to the latter's Crestor (rosuvastatin). Another beneficiary is likely to be Abbott Laboratories, which is acquiring Kos Pharmaceuticals. Kos markets Niaspan (niacin) and Advicor (niacin plus lovastatin), both of which are recognised as being particularly potent at raising HDL or 'good' cholesterol.
Roche has a similar product in development to torcetrapib, called R1658, which hasn’t caused an increase in blood pressure like Pfizer’s product. However, Denise Anderson at Kepler noted that the US Food and Drug Administration is raising questions about the safety of this class.