Merck, Abbott Shares Muted Pre-Market On Study Results
- By Peter Loftus Of DOW JONES NEWSWIRES Merck & Co. (MRK) shares fell less than 1% in pre-market trading Monday after a new study showed its Zetia cholesterol drug was inferior to Abbott Laboratories' (ABT) Niaspan at clearing clogged arteries. Merck shares traded at $32.90 recently, while Abbott shares were up about 1% at $53.50. Market reaction may be relatively muted because the study's outcome was essentially in line with Wall Street expectations. Many investors had already bet against Merck since the study was halted prematurely in the summer. Still, pre-market trading trends don't always continue after the opening bell. The new study, titled "Arbiter 6," is the latest setback for Merck's blockbuster cholesterol-drug franchise, whose sales have fallen since early 2008 on separate studies that raised questions about the efficacy and safety of Zetia and a related drug, Vytorin. Analysts expect the new study to cause further sales declines as doctors question the drugs' usefulness. "We believe our current model, which assumes a 30% decline in U.S. Zetia/Vytorin utilization by 2011, likely represents a worst case impact from ARBITER 6," Leerink Swann analyst Seamus Fernandez wrote in a research note Monday. Conversely, Wall Street sees Abbott's Niaspan getting a boost from the study. Wells Fargo analyst Larry Biegelsen wrote he expects sales of Abbott's Niaspan and related drugs to rise nearly 13% in 2010, to $1.1 billion. Some doctors said the study could propel niacin--the active ingredient of Niaspan--to become the preferred second-agent option for cholesterol treatment, on top of the gold standard, statins. "I think it's a big win for niacin," said Roger Blumenthal, director of Johns Hopkins Ciccarone Preventive Cardiology Center in Baltimore. He doubts, however, that the Arbiter 6 study alone will be enough to prompt changes in formal clinical guidelines, partly because the study primarily tracked artery thickness, not cardiovascular outcomes. Any formal changes will have to await the results of ongoing studies that are tracking niacin's effect on risk of heart attacks and other outcomes, Blumenthal said. One of those ongoing studies is sponsored by Merck, which has developed its own version of niacin combined with an agent to inhibit a common skin-related side effect of niacin known as flushing. The U.S. Food and Drug Administration declined to approve the Merck niacin product last year, but may revisit the drug when a projected 25,000-patient trial is completed around 2013. A separate Merck-sponsored study of cardiovascular outcomes in Vytorin users is due to be completed around 2012. The Arbiter 6 study found that adding Niaspan to statins reversed the narrowing of the arteries in people with established cardiovascular disease, while those taking Zetia with a statin had no significant change in artery thickness. A secondary measure in the study found fewer cardiovascular events among the Niaspan patients, too. Abbott funded the trial, which was run independently by a Washington cardiologist, Allen Taylor. Merck has played down the importance of the trial, citing its relatively small size, its lack of a placebo control arm, and the profile of the patients--who were already on statin treatment and entered the trial with relatively low overall cholesterol levels. Niaspan and Zetia work by different mechanisms. Niaspan's primary benefit is to raise levels of good cholesterol, while Zetia helps to lower bad cholesterol. -By Peter Loftus, Dow Jones Newswires; 215-656-8289; peter.loftus@dowjones.com Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http://www.djnewsplus.com/access/al?rnd=jFJrwcczw2ZPEL1FUGAC9g%3D%3D. You can use this link on the day this article is published and the following day.
