Drug Package

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LILLY, MERCK, SCHERING-PLOUGH POST MIXED RESULTS ___________________________________________________________________________ Merck & Co. Inc. reported decreased third-quarter earnings Thursday, due partly to the recall of its COX-2 inhibitor Vioxx (rofecoxib), while Eli Lilly and Co. reported improved earnings and Schering-Plough Corp. swung to a profit.

Merck's global third-quarter sales dropped 4 percent to $5.54 billion, which it said included a $491.6 million unfavorable effect related to the Vioxx withdrawal. Vioxx sales totaled approximately $2.5 billion last year.

Third-quarter net income at Merck totaled approximately $1.33 billion. The firm recorded $1.86 billion in net income last year, but Merck said comparison is not meaningful because of the August 2003 spinoff of Medco Health Solutions Inc. Earnings per diluted share fell from $0.83 to $0.60. Merck estimated the Vioxx withdrawal had a $552.6 million unfavorable effect on third-quarter income.

The company now anticipates fourth-quarter earnings per share in the range of $0.48 to $0.53 and full-year earnings per share of $2.59 to $2.64. Full-year earnings per share will be negatively impacted by $0.50 to $0.55 as a result of the Vioxx withdrawal, Merck estimated.

Global sales of the cholesterol drugs Zetia (ezetimibe) and Vytorin (ezetimibe/simvastatin), which are marketed through a collaboration of Merck and Schering-Plough, totaled $293 million and $52 million, respectively.

Schering-Plough's net income reached $14 million in the third quarter, up from a net loss of $265 million in last year's third quarter. Earnings per diluted share reached $0.01, compared with an $0.18-per-share loss one year ago. These results include special charges of $26 million this year and $350 million last year. Overall sales totaled $1.98 billion, 1 percent lower than the $2.0 billion recorded last year, while prescription drug sales were down 2 percent to $1.56 billion.

At Lilly, third-quarter net income reached $755.2 million, up 6 percent from $714.4 million in the same period of last year. Earnings per diluted share were up 5 percent from $0.66 to $0.69. Net sales totaled $3.28 billion, up 4 percent from $3.14 billion.

In addition to releasing its financial results, Lilly said it will cut a total of approximately 1,000 positions from its workforce, including the 575 job cuts in its sales and marketing division that were announced last week. Lilly said one reason for the job cuts is the poor performance of its antipsychotic Zyprexa (olanzapine) in the United States. Third-quarter U.S. sales of Zyprexa dropped 22 percent to $557.3 million, while worldwide sales were down 9 percent to $1.02 billion.

Global sales of the erectile dysfunction drug Cialis (tadalafil) totaled $154.1 million during the quarter, while U.S. sales totaled $70.2 million. Cialis is marketed by Lilly Icos LLC, a joint venture of Lilly and Icos Corp.

Shares of Lilly dropped $2.46, or 4.5 percent, to $52.64, in heavy trading on the New York Stock Exchange, while Icos shares climbed $0.12, or 0.6 percent, to $21.78, in heavy Nasdaq trading. Merck closed at $31.26, down $0.14, or 0.5 percent, while Schering-Plough closed at $16.98, up $0.26, or 1.6 percent, both in moderate Wall Street trading.

ASTRAZENECA, NOVARTIS REPORT STRONG PERFORMANCE IN THIRD QUARTER ___________________________________________________________________________ AstraZeneca Plc and Novartis AG achieved strong financial results in the third quarter of 2004.

AstraZeneca's third-quarter sales increased 7 percent to $5.27 billion, up from $4.80 billion generated in the comparable period last year. Sales of the antipsychotic Seroquel (quetiapine fumarate) jumped 51 percent to $529 million, while sales of the dyslipidemia treatment Crestor (rosuvastatin) reached $260 million. Sales of the ulcer therapy Nexium (esomeprazole magnesium) slid 6 percent in the quarter to $951 million.

The firm's third-quarter operating profit totaled $1.26 billion, up 16 percent from $1.10 billion in the prior year period. Earnings per share, including a $0.17 benefit from exceptional items, reached $0.72, a 56 percent increase from $0.47 last year.

"Despite the recent disappointment with Exanta, the business is performing well. . . . A continuing strong performance in the fourth quarter should yield full year pre-exceptional earnings of around $2.10 per share and will provide an effective platform for growth in 2005," said Sir Tom McKillop, AstraZeneca's chief executive.

In September, the Food and Drug Administration recommended against approval of Exanta (ximelagatran) for three indications: preventing blood clots in veins among patients undergoing knee replacement surgery; prophylaxis of stroke and other clot-induced complications associated with atrial fibrillation; and long-term prevention of blood clots in veins after a patient has received a standard blood clot treatment.

Separately, Novartis' third-quarter earnings increased 21 percent to $1.55 billion, or $0.63 per share, on strong sales of its Diovan (valsartan) hypertension therapy and cancer treatments Gleevec (imatinib mesylate) and Zometa (zoledronic acid). The therapies generated sales of $788 million (28 percent gain), $411 million (47 percent gain) and $262 million (9 percent gain), respectively.

Overall, Novartis' total sales reached $7.06 billion, up 14 percent from $6.21 billion generated in the third quarter of 2003.

The company noted that lower sales growth from its generic division, Sandoz, was offset by a 10 percent increase in consumer health sales, due primarily to double-digit growth in over-the-counter and medical nutrition sales.

Shares of AstraZeneca closed at $40.50, up 40.87, or 2.2 percent, while Novartis shares closed at $47.23, up $0.53, or 1.1 percent, both in moderate trading on the New York Stock Exchange.

PHASE III DATA SHOW TREATMENT WITH CTLA4-LG BENEFITS PATIENTS WITH RHEUMATOID ARTHRITIS ___________________________________________________________________________ Data from two Phase III trials show Repligen Corp.'s CTLA4-lg may benefit patients who do not adequately respond to current rheumatoid arthritis treatments, including tumor necrosis factor therapies.

In one placebo-controlled trial, patients were randomized to receive CTLA4-lg plus methotrexate or methotrexate alone. CTLA4-lg or placebo was administered in a single 30-minute infusion on days one, 15 and 29, and every 28 days thereafter. Researchers defined the trial's primary endpoint as the percentage of patients achieving at least a 20 percent improvement in multiple measures of disease activity (ACR 20).

Results showed after six months of treatment, 67.9 percent of patients administered the CTLA4-lg-methotrexate regimen achieved an ACR 20 response compared with 39.7 percent in the methotrexate monotherapy group. Furthermore, after one year of treatment, patients treated with CTLA4-lg achieved statistically significant improvements on the ACR 20, ACR 50 and ACR 70.

In the second study, patients with active rheumatoid arthritis who were not adequately responding to at least three months of treatment with TNF inhibitors were randomized to receive CTLA4-lg 10 mg/kg or placebo.

At six months, 50.4 percent of patients treated with CTLA4-lg achieved an ACR 20 response compared with 19.5 percent of placebo recipients. Additionally, statistically significant improvements were achieved on the ACR 50 and ACR 70.

Both trials were sponsored by Bristol-Myers Squibb Co. and were presented in San Antonio, Texas, at the annual meeting of the American College of Rheumatology, according to a Repligen press release.

Repligen shares closed at $2.40, up $0.48, or 25 percent, in heavy Nasdaq trading.

PREOS EFFECTIVE IN PHASE III STUDY; QUESTIONS RAISED OVER TOLERABILITY ___________________________________________________________________________ NPS Pharmaceuticals Inc. reported Phase III data that showed the firm's Preos (parathyroid hormone) reduced the risk of vertebral fractures in postmenopausal women with osteoporosis, regardless of whether they had experienced a fracture prior to Preos initiation. NPS shares, however, dropped Thursday in reaction to data that showed the drug raised serum calcium to a high level in 21 percent of patients.

In the study, 2,600 postmenopausal women with osteoporosis were randomly assigned to receive a daily subcutaneous injection of Preos 100 mcg or placebo in addition to calcium and vitamin D supplements. The current analysis only includes the 1,870 subjects who took at least 75 percent of their prescribed doses and had no other protocol violations.

Data showed the incidence of vertebral fracture among all Preos-treated patients was 1.14 percent, compared with 3.3 percent among those treated with placebo, reflecting a 66 percent reduced risk with Preos.

The incidence of vertebral fracture was 2.63 percent among Preos-treated patients who had experienced a previous vertebral fracture versus 8.38 percent among those treated with placebo (69 percent risk reduction). In those with no previous fracture, the incidences were 0.83 percent and 2.22 percent, respectively (63 percent risk reduction).

However, 21 percent of all patients in the Preos group had a serum calcium measurement during the study that exceeded 10.7 mg/dL versus 3 percent of patients in the placebo group.

"Preos data presented at [the American College of Rheumatology conference] raise concerns that the tolerability of NPS' drug may not be as high as Eli Lilly [and Co.'s] Forteo (teriparatide)," said Hibernia Southcoast Capital analyst Bennett Weintraub, according to Reuters. Weintraub said Forteo has been shown to cause transient hypercalcemia in 6 to 11 percent of patients.

Both drugs are bioengineered versions of human parathyroid hormone, Reuters reported.

Weintraub said Preos, which is expected to be submitted to the Food and Drug Administration this year, is still likely to be approved by the agency.

The study data were presented in San Antonio at the 68th Annual Scientific Meeting of the American College of Rheumatology.

NPS shares closed at $16.88, down $1.22, or 6.7 percent, in heavy Nasdaq trading.

CARE MANAGEMENT FOR LOW-RISK PATIENTS WITH HEART FAILURE APPEARS TO HAVE MINOR EFFECTS ON REHOSPITALIZATIONS, NEW DATA SHOW ___________________________________________________________________________ Nurse care management did not statistically significantly reduce rehospitalizations among low-risk patients with heart failure in new research.

The study included 462 patients hospitalized between May 1998 and October 2000 with a provisional diagnosis of heart failure from five northern California Kaiser Permanente medical centers. Patients were randomized to usual care and physician-directed, nurse-managed, home-based care (n=228) or usual care alone (n=234). Heart failure severity at baseline was New York Heart Association (NYHA) class I or II for 49 percent of the patients and NYHA class III or IV for 51 percent of the patients.

At one year, 51 percent of patients receiving care management were rehospitalized, for a total of 237 rehospitalizations, compared with 50 percent of patients in the usual care group, for a total of 232 rehospitalizations.

Furthermore, the analysis revealed that time to first rehospitalization for heart failure and all-cause rehospitalization did not statistically significantly differ between the two groups.

""[T]he benefits of specialized health care programs for heart failure that target the elderly, the underserved and those with advanced heart failure may not be generalizable to low-risk patients, especially in medical settings, such as HMOs, that promote systemic care for heart failure," the researchers concluded.

Complete study details were published in the Oct. 19 issue of Annals of Internal Medicine.

Drug Package
EISAI INC. ___________________________________________________________________________ Eisai Inc. and Pfizer Inc.'s Aricept ODT (donepezil hydrochloride) orally disintegrating tablets received marketing approval from the Food and Drug Administration. The product will be sold in 5 mg and 10 mg versions, the same strengths available in traditional tablet form, and will be launched in the second quarter of 2005. The product is indicated for the treatment of mild to moderate Alzheimer's disease.

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SANOFI-AVENTIS GROUP ___________________________________________________________________________ The sanofi-aventis Group reported proforma combined net sales of $8.75 billion in the third quarter, up 10.7 percent over proforma combined sales in the same period of 2003. When including sales generated under collaboration agreements (such as the agreement with Bristol-Myers Squibb Co. regarding antiplatelet drug Plavix [clopidogrel]), proforma combined sales grew 13 percent to $9.26 billion. Sanofi shares closed at $35.85, down $0.30, or 0.8 percent, in moderate Wall Street trading.

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AMGEN INC. ___________________________________________________________________________ Amgen Inc. reported its third-quarter earnings, excluding special items, totaled $839 million, or $0.64 per share, in 2004, reflecting a 21 percent increase from the same period of last year. Total revenue reached $2.71 billion, up 23 percent over the year-ago period. Third-quarter sales of anemia drug Aranesp (darbepoetin alfa), however, disappointed. The product generated $608 million in sales, up 39 percent from $438 million last year; analysts were expecting $650 million in Aranesp revenue, according to TheStreet.com. Amgen shares closed at $54.28, down $2.13, or 3.8 percent, in heavy Nasdaq trading.

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CHIRON CORP. ___________________________________________________________________________ Chiron Corp. executives said they cannot guarantee the company will be able to resume influenza vaccine production in time to supply the United States with vaccine for the 2005-2006 flu season, according to a New York Times report. Chief Executive Howard Pien said the company still must design a plan to rectify its sterility and quality-control problems and receive input from British and American regulatory agencies. A Chiron spokeswoman said the firm cannot assure it will resume production next year, "or ever," according to the Times report.

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