Friday, August 13, 1999
Duramed pill approved
Generic oral contraceptive should be cheaper
BY MIKE BOYER and TIM BONFIELD
The Cincinnati Enquirer
Duramed Pharmaceuticals Inc. moved into the oral contraceptive market Thursday, winning federal approval for the first generic alternative for two popular birth control pill brands.
Duramed said its Desogestrel oral contraceptive won Food and Drug Administration (FDA) approval as a substitute for Johnson & Johnson's Ortho-Cept and Dutch drugmaker Akzo Nobel NV's Desogen birth control pills.
Duramed's pill could be good news for women because many health insurers do not cover birth control pills or charge members higher co-payments to use brand-name drugs. The test will be whether Duramed's product offers significant price savings and shows consistent quality, said Dr. Jill Huppert, a member of the University of Cincinnati's department of obstetrics and gynecology.
“There are other generic birth control pills out there, but the prices aren't that much less than the brand-name versions,” Dr. Huppert said. “I would like to see a significant reduction in price.”
Another advantage for Duramed's pill: It's a generic version of a relatively new generation of “combined” birth control pills that use the hormones estrogen and progestin. The combined versions offer fewer “nuisance” side-effects — such as acne, headaches and spotting — than older estrogen-only pills, Dr. Huppert said.
E. Thomas Arington, Duramed's chairman and CEO, declined to forecast sales for Desogestrel. “Clearly, we think this will be a very good product for us,” he said.
He didn't have information on how much cheaper Desoges trel will be than its branded competitors but predicted, “There will be savings for consumers.”
Duramed's price for its pill will be a big factor, said Peter Reeme, pharmacy director for ChoiceCare/Humana, a managed-care health plan that has covered birth control pills for many years.
Using a generic pill isn't required for ChoiceCare members, but they often can save $5 to $10 per month in co-payments when they opt for a generic.
So far, generic birth control pills haven't been a big savings for HMOs, Mr. Reeme said.“All these products cost us $20 or less per month. The generics are maybe $5 cheaper. It doesn't radically change our costs,” Mr. Reeme said.
Dr. Huppert said U.S. prices for birth control pills typically run $25 to $30 per monthly pack. But many of those same drugs can be purchased in other countries for as little as $1 to $5 per pack.
“In the U.S., the public pays for a lot of legal and marketing costs,” she said.
The new pill would be Duramed's second large product announcement in six months.
In March, Duramed won FDA approval for Cenestin, a synthetic conjugated estrogen for the treatment of the symptoms of menopause. Cenestin is the only direct competitor to American Home Products' Premarin, a synthetic estrogen product which controls the $1 billion annual estrogen replacement market.
Longer term, Mr. Arington said Duramed is working on a substitute for Tamoxifen, a treatment for women with high risk of breast cancer.
“We expect to successfully compete in this important segment of women's health care, and also anticipate filing additional applications with the FDA for hormonal products within the coming months,” he said.
The Pleasant Ridge company, which now employs more than 340, will add 100 employees over the next six months as it gears up production of Cenestin and Desogestrel, Mr. Aring ton said.
Wall Street applauded Duramed's announcement. Shares in the company rose as much as 24 percent Thursday, closing at $11.25, up $1.25.
“It shows that they have the technology to get the FDA approvals,” said Sidney Taubenfeld, an analyst at New Vernon Associates. “What remains to be seen is whether they have the marketing to get the sales ... that's the key issue.”
As a generic, the company's contraceptives can be sold for less, and pharmacies will substitute the Duramed drug for a branded formula unless doctors specify on the written prescription that the brand-name drug is to be used, Mr. Taubenfeld said.
Still, the company will have to market the drug effectively to gain enough market share to generate strong sales, in a “tough” contraceptive market where there are a lot of competing pills, he said.
Duramed expects to begin shipments of Desogestrel within 60 days.
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