Monday, August 30, 2010

"The Fool's" Merck Pipeline Piece -- Saying The Soft Parts, LOUDLY

Over at The Motley Fool tonight, Brian Orelli gets it generally right -- as he looks at New Merck's top four pipeline prospects. What he is absolutely perfectly spot-on about is that pipelines are always only "potentials" -- ones that must be actualized, for revenue to ensue:

. . . .Unfortunately, a pipeline only represents potential. The drugs still need to show positive results in order for that potential to turn into revenue. . . .

Merck's hepatitis C drug Boceprevir works great. The problem is that its competitor, Vertex Pharmaceuticals' Telaprevir, seems to work better. I say "seems to" because neither company has run a head-to-head trial comparing the two. But comparing between trials, Telaprevir was able to cure a higher percentage of patients than Boceprevir.

Boceprevir's last chance at stardom will come when Vertex releases phase 3 data on patients who have already failed a previous treatment. Boceprevir was able to cure 66% of patients in its phase 3 trial in that population. If Vertex and marketing partner Johnson & Johnson can top that number, you can write off Boceprevir. It'll still likely get approved, but won't be a major contributor. . . .

Gee -- where have I heard that before? [Almost two years before.] Yes, I do think Vertex will post better Phase III non-responder numbers than New Merck has.

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