Pfizer Succeeds at Slowing Loss of LIPITOR Sales After Patent Expires

At the end of November 2011, the patent expired on the biggest-selling drug in the U.S.: LIPITOR. But its manufacturer, Pfizer, had decided to make LIPITOR-saving efforts, even though generic versions were going to be available as atorvastatin, for much lower prices. The cholesterol-lowering drug had, according to The New York Times, brought in $106 billion in sales over the last decade, a cash flow Pfizer seemed desperate to avoid losing too quickly, despite this healthy competition from generics.

So Pfizer made a deal with the biggest pharmacy benefit management (PBM) company in the world, Medco. PBMs act as middlemen to sell drugs for drug companies to insurers and employers sponsoring insurance plans. Because of this Pfizer-Medco deal, starting on Dec. 1, 2011, when generic atorvastatin became available in drugstores, patients whose drug benefits were managed by Medco would not be able to purchase the generic version of the drug, but would be forced to get LIPITOR, even if their doctor had written a prescription for generic atorvastatin.

Even if this deal lasted for only six months (through May 2012), after which many more generic companies would be allowed to flood the market with their versions of atorvastatin, Pfizer would reap an additional $700 million in 2012 alone, according to Wall Street drug analyst Dr. Tim Anderson, compared to what it would have profited if such a deal had not been sealed. This is because the drugmaker’s deal would significantly slow the pace of the ultimate switch to the generic version.

Well, the plan seems to have worked somewhat because, five months after the LIPITOR patent expired, Pfizer still sold $268 million of LIPITOR in April 2012, retaining 43 percent of the market it had before the patent expired.

But Pfizer seems satisfied with what it has done to slow down the exodus of LIPITOR prescriptions. The world’s largest drug company recently told The Wall Street Journal that it “is quietly giving up on its once-great cash cow for good because more generic versions will soon be going on sale” and that “the company is no longer negotiating new contracts to sell LIPITOR to health plans, which are signing up to sell generic versions at far lower prices.”

At one time spending $271.9 million on LIPITOR advertising, Pfizer has also stopped promoting the drug through sales representatives. Perhaps, with the extra five months of hundreds of millions of extra profits, the drugmaker realizes the writing is on the wall.