Phenomenal sales of Schering-Plough’s new cholesterol-lowering products helped the company to net income of $350 million in the first quarter of 2006, a more than threefold improvement from a year ago.
Driving the bottom line was a stellar performance by the firm’s Zetia (ezetimibe) and Vytorin (ezetimibe plus simvastatin) products, which Schering-Plough co-markets in a joint venture with Merck & Co.
Sales from the joint venture rose 54% to $778 million, providing Schering-Plough with equity income of $311 million, and this helped overall revenues at the group to climb 8% to $2.6 billion, ahead of analyst estimates.
The performance marks a significant turnaround at Schering-Plough since the firm implemented a restructuring exercise three years ago, after being pummelled by the loss of patent protection on its multibillion dollar Claritin (loratadine) and quality problems at its manufacturing plants.
“These results represent the sixth consecutive quarter of year-over-year net sales growth,” said the company in a statement.
Other products contributing to the sales growth - which compares favourably with the flat revenues or even declines reported by Schering-Plough’s big pharma peers – included rheumatoid arthritis drug Remicade (infliximab), which rose 26% to $278 million. Brain tumour drug Temodal (temozolomide) grew 25% to $163 million, and intranasal steroid Nasonex (mometasone furoate monohydrate) also rose by a quarter to $229 million, helped by a major marketing push.
Claritin follow-up Clarinex (desloratadine) brought in $160 million, up 11%, although this was offset by a 9% decline in Claritin to $101 million. A Japanese launch for hepatitis C treatment PEG-Intron (peginterferon alfa-2b) helped the product to a 16% hike to $196 million, despite strong competition from Roche’s rival product Pegasys (peginterferon alfa-2a), while another hep C treatment, Rebetol (ribaviron), grew 22% to $78 million.
Fred Hassan, Schering-Plough’s chief executive, acknowledged that its cholesterol franchise could come under pressure later this year when Merck’s Zocor (simvastatin) loses patent protection, but he stressed that Vytorin, “more than any other cholesterol-lowering agent, has demonstrated the ability to get patients to their treatment goals.”
Zetia and Vytorin are now verging on capturing 15% of new prescriptions in the USA on the back of this superior potency, he noted.
Hassan also said that Schering-Plough is looking to acquire new products to bolster its late-stage product pipeline, either through licensing deals or acquisitions.
“We know that to deliver sustainable growth, we must supplement our internal research work with external opportunities,” he said. Schering-Plough has a gap in Phase III clinical projects, although things improve in Phase II with three drugs, vicriviroc for HIV/AIDS, hepatitis C treatment SCH 503034 and SCH 530348, a thrombin inhibitor.