Merck drops depression drug
pharmafile | November 14, 2003 | News story | |Â Â Â
US pharma company Merck has stopped development of a new depression drug in late-stage clinical trials, casting doubt over the company's pipeline's ability to generate short-term growth.
Merck confirmed it would be discontinuing its phase III clinical development programme for its substance P antagonist investigational product, MK-0869 (aprepitant) for the treatment of depression.
Commenting on the setback Peter S. Kim, president of Merck research units said: "There are significant challenges in scientific research, and unfortunately, sometimes disappointments. While we had reason to believe that the compound could be effective in the treatment of depression, the results of the phase III trials did not demonstrate efficacy."
Analysts had predicted peak sales of $1.5 billion in the US if it had been approved, but had been doubtful about the drug's chances of passing FDA scrutiny.
The drug's failure and a recent restructuring initiative, which saw 4,000 redundancies has led analysts to question the US drugmaker's overall strategy.
"Merck has had declining earnings per share for the last several years, and future growth prospects look dim as well," said Deutsche Bank's Barbara Ryan. "Much of this bleakness is already discounted in the shares, but Merck needs a dramatic overhaul and a bold strategic plan to build value."
According to analysts, Merck's ability to turn things around quickly will depend on a pipeline that, although far from dry, is struggling to build short-term growth.
A source of greater optimism is the mid-2004 launch of a cholesterol combination treatment co-developed by Merck and Schering-Plough, which puts statin Zocor and novel cholesterol absorber Zetia into one pill.
Related articles
October 28, 2003
