Friday, October 8, 2021

Power Alley Alert: Someone Wrote This Week -- About Merck's Supposed "Patent Cliff", In 2028 -- Condor's View? It Doesn't Really... Exist.


As many truly-long-term readers here will recall -- in August of 2010, and for a few years prior to that, we detailed what a real, and burgeoning. . . patent cliff looked like, at the then-newly integrated Merck/Schering-Plough portfolios.

By August 2010, Sch-Merck® (as we styled it), had at least 18 drug franchises going generic in under two elapsed years, to the tune of over $20.5 billion in annual sales revenue. That was a figure that eclipsed a third of all the combined companies' revenue. That's a real. . . patent cliff.

Contrast that relatively dire 2010-11 situation (and Merck's stock trading at ~$32 a share) with today's news that Keytruda® (in theory) might go off-patent. . . in seven years, or so (and Merck's NYSE price at above $80). Yes, pembrolizumab is a monster franchise -- doing around $19 billion in annual sales. But the writer of that analysis (I won't link it) seems unaware of the nearly-endless "evergreening" opportunities for US patents, on single franchise drugs. It is far more difficult to file numerous extensions, and continuations in part, on a stable of. . . say thirty or so decades-old drugs. . . than it is -- by some legal sleight of hand -- to extend a single set of patents on one agent (pembrolizumab / Keytruda®). . . into the mid-2030s.

Yes, the patent system (in the US in particular) is sub-optimal, as to human health care / medical inventions' ultimate outcomes. But this is the way it works: that Keytruda® patent is nowhere near as old and decrepit, as those protecting say Clarinex®, Temodar® or even Zetia®.

So -- for what is worth, while I still think the molnupiravir (MK-4482, EIDD-2801) news is great for the stock, it was over-heated in the moment, and has now settled into a normal trading range. But anyone predicting say $40/share on the NYSE for Merck in 2028, on a supposed loss of patent protection for pembrolizumab. . . is (respectfully, of course) smoking some really bad (paraquat tainted) weed.

Onward, grinning -- ever. . . grinning. Be excellent to one another; baby-girl sleepova' here, tomorrow. . . .

नमस्ते

No comments: