Merck & Co.’s stock dived 3 percent on Thursday, a day after the pharmaceutical giant added a label warning of deadly side effects to packages of its best selling drug.
The new label for cholesterol-lowering agent Zocor highlights the risk of patients developing Myopathy and Rhabdomyolysis from taking the drug alone or in combination with other medicines. Myopathy is a condition which causes muscle pain and weakness. Rhabdomyolysis is a related, potentially lethal condition which destroys muscle cells and releases them into the blood stream, sometimes causing kidney failure.
Both conditions have been linked to the cholesterol-lowering drugs known as statins. However, last year, Bayer Corp. withdrew its cholesterol-lowering drug Baycol because it was tied to 31 deaths in the United States caused by Rhabdomyolysis.
Merck spokesman Greg Reaves said the revision was not connected to any severe patient side effects from the drug. He added Merck requested the change from the Food and Drug Administration based on some routine follow-up studying of Zocor because “it was in the best interest of patients and doctors.”
“We think this adds clarity. It does not change the safety and efficacy profile of Zocor which have been well established,” he said.
Prudential analyst Tim Anderson, who reported the changes in a report released Thursday, said he expected the revision to hurt Zocor sales, which totaled $6.8 billion last year. Anderson anticipated Zocor’s competitors would use the information to boost their own sales_unless the FDA requires similar label changes from the other statins.
Both Pfizer Inc, which makes market leader Lipitor and Bristol-Myers Squibb Co, which makes Pravachol, said they were not discussing any similar label changes with the FDA. Neither would comment on whether they would use Merck’s new label to benefit their drugs.
“I think Pfizer will use it,” said Anderson of the company noted for its marketing practice.
Indeed, Anderson expects Lipitor’s sales to grow even though AstraZeneca PLC will be introducing a statin called Crestor either later this year or in early 2003. Analysts studies have shown that Crestor works better than Lipitor but that the later is more safe. Anderson says that will become more important in the wake of Zocor’s label change.
Anderson hasn’t lowered either his Zocor sales estimates or 2002 earning forecast for Merck because he said they were already conservative. He expects Zocor sales to reach $7.3 billion and earnings to hit $31.3 a share. Last year, Merck said 2002 earnings would be flat because of patent expirations and slow growth of pain reliever Vioxx.
Specifically, the new label uses “Myopathy and Rhabdomyolysis” is a warnings section that had previously referred to “skeletal muscle” issues. Another sections uses bullets, underlines and bold text in the section of the label discussing Myopathy and Rhabdomyolysis
The new label also states the risk of the conditions is higher with larger does of the drug and warns patients taking a heat drug called Amiodarone not to exceed a 20 mg. dose of Zocor.