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November 10, 2011
Makena's Market. Or Lack of One.
Posted by Derek
I put up a note here yesterday about KV Pharmaceuticals and their complaint to the FDA about compounding pharmacies selling a version of their Makena progesterone ester drug. The conclusion was that the combination of Makena's high price and the FDA's we-won't-enforce attitude towards the compounders was hurting sales.
And that it is. The people at BioCentury have more. Basically, the estimate is that about 140,000 women per year fall into the potential treatment class of high-risk pregnancies. How much Makena has been sold since its launch last March? The company says that about 2,400 patients have started treatment or are enrolled to start. Now, we don't have figures on how many patients have filled prescriptions from compounding pharmacies, and I don't know how many people took this therapy before KV got involved.
But still. . .that's what, a 2 or 3% market penetration? I'll bet KV's sales projections weren't at that level.
Comments (4)
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1. PharmaHeretic on November 10, 2011 1:29 PM writes...
Here is some red meat for you. Note the very recent date of this article.
http://www.forbes.com/sites/matthewherper/2011/11/10/what-bill-gates-says-about-drug-companies-2/
"Most of what Bill Gates said to me over the course of two interviews found its way into the cover profile of him I wrote for the most recent issue of Forbes. But one set of ideas didn’t really make it: his unique and thoughtful perspective on the pharmaceuticals industry."
Permalink to Comment2. Student on November 10, 2011 3:46 PM writes...
If you add a zero to the price, its cool to take a zero off the market penetration.
Permalink to CommentI don't understand how these people can sleep at night.
3. cynical1 on November 10, 2011 5:03 PM writes...
So, was the progesterone ester always formulated at these pharmacies prior to introduction of KV's approved product, Makena, in March? Who made the IV formulation in the past? Was it always one of these compounding pharmacies? That would explain why they (KV) haven't had market penetration. Will there be liability for the pharmacies if they started doing it after the FDA approved drug came to market as opposed to that they were doing it all along in the past anyway?
Permalink to Comment4. BiotechTranslated on November 10, 2011 11:03 PM writes...
I'll bet that KV thought that the FDA would help them capture a lot more of that market.
Adam's laboratories did a similar thing with guaifenesin. All the products on the market were "unapproved", so they got their product approved, then the FDA sent all their competitors "cease and desist" letters. Aisling capital made a 15x return on their investment in Adam's when it was bought by Reckitt Benckiser for $2.3B.
If you think about the economics, I'm guessing a dose of Makena costs KV less than $100 to make (it's not high volume). So at $1300, that's a pretty healthy profit if you capture even 70% of the market. And since it's used high-risk pregnancies, it's not like the need ever goes away.
I think the fact the FDA didn't play along completely blind sided them. However, it does appear that things are turning around for them.
Mike
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