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Pfizer to Discontinue Sales of Inhaled Insulin Drug Exubera

Written by on Friday, October 19th, 2007

Pfizer announced on Thursday its decision to discontinue sales of its new inhaled insulin drug Exubera.

Exubera was developed by San Carlos-based Nektar Therapeutics, which licensed the drug to Pfizer.   According to the Philadelphia Business Journal, Pfizer plans to transfer the rights to Exubera back to Nektar Therapeutics and take a “$2.8 billion charge to dispose of its interests in it.”

The Philadelphia Business Journal reported:

Pfizer at one time said Exubera, approved about two years ago by the Food and Drug Administration, would be a $2 billion-a-year drug, but it was slow in rolling out the marketing of the drug and its device, which was criticized by doctors and insulin users as being too bulky.

So what happened to cause Pfizer to pull the plug on Exubera?

The San Jose Mercury News reported on the background to this decision as follows:

Because 21 million Americans have diabetes and many of them dislike injecting insulin, Exubera – the first-ever inhaled insulin system for adults – was widely expected to be a blockbuster. . . . But despite a recently launched TV ad blitz by Pfizer, the product has been a major disappointment. Although Pfizer has been vague about overall sales, the company revealed that Exubera’s revenue for the second quarter of this year was a mere $4 million. Some people attribute Exubera’s dismal sales to the fact that it is more expensive and complicated to use than injectable insulin. Figuring out the proper dose of Exubera also is somewhat different than with injectable insulin. And because Exubera can hinder lung function in some cases, anyone using it is supposed to get a lung test first. In addition, some doctors complain that a daily dose of Exubera costs at least twice as much as the injectable variety and that some insurance companies won’t pay for it.  But others fault Pfizer for not manufacturing it quickly enough, trying to market it initially with an ill-prepared sales team and delaying its ad campaign until this summer.

The Wall Street Journal Online reported on Pfizer’s decision as follows:

Drug companies often cancel drugs during human trials, and occasionally after they go on the market if there are any red flags about safety. But to pull a new drug from the market because it didn’t sell — in the absence of a red flag — is almost unprecedented.

“This is one of the most stunning failures in the history of the pharmaceutical industry,” said Mike Krensavage, an analyst at Raymond James & Associates. “I hope it would give Pfizer pause about buying any more assets.”

Pharma Marketing Blog took the analysis of Pfizer’s decision one step further and compared the failure of Exubera to the sinking of the Titantic:

There are plenty of . . . similarities between Exubera’s failure and the failure of the “unsinkable” Titanic. I am specifically talking about Pfizer’s hubris and marketing’s poisoned Kool Aid. Like the builders of the Titanic, the Exubera marketers felt they had an “unsinkable” product that would quickly reach blockbuster status and make the company a bundle.

It is unclear to date as to the exact terms and conditions of the Nektar Therapeutics license agreement, but the Wall Street Journal Online described Pfizer’s action as a “termination” of the license agreement for a definitive price, and The Mercury News reported that Nektar Therapeutics will have the ability to sell and market the Exubera itself on an ongoing basis.  Thus, there is reason to believe that Pfizer’s decision constituted the termination of an exclusive licensing agreement, and that the parties had previously agreed in writing to the specific damage amount to be paid to Nektar Therapeutics in the event of termination.

Apparently, however, Nektar Therapeutics is still recovering from the shock it received yesterday with Pfizer’s announcement, and has yet to announce its future plans for the drug.  The Wall Street Journal Online reported:

The news that Pfizer was abandoning Exubera came as a surprise to Nektar of San Carlos, Calif., from which Pfizer licensed Exubera. Nektar issued a scathing news release late yesterday accusing its partner of a poor marketing job and of not alerting Nektar it would be terminating their licensing deal. Pfizer says it told Nektar of its plans minutes after releasing the news, because the announcement was material for both companies.

The Wall Street Journal Online points out that, even if Nektar Therapeutics does try to move forward with the commercialization of Exubera, questions remain as to the safety and overall viability of inhaled insulin products:

[T]he market for other inhaled-insulin products still in development [is up in the air]. Part of Exubera’s problem — the safety concerns that come with inhaling a drug — will be hard to surmount for any product that goes into the lungs, in the absence of long-term data. There is also the question of whether patients want to inhale insulin, or are really resistant to needles.  In the 11 years since Pfizer bought into the idea, insulin pens have made injecting the drug less painful than the traditional needle and syringe.

The Exubera debacle shines a spotlight on the role of the medical community in determining whether a novel technology is a success or a failure.  While there is no doubt that a variety of factors contributed to the product’s failure, clearly Pfizer did not focus adequately on addressing the concerns of the medical community in its attempt to bring Exubera to market.  Too many lingering questions about the product and its delivery system remain, and my suspicion is that the conservative medical community urged patients to stick with the tried and true products rather than to give Exubera a try.  In all likelihood, the fact that the product was more expensive than the other options on the market was just the icing on the cake.


Comment from Mathew Abraham
Time October 26, 2007 at 5:16 am

I am an insulin dependent diabetic, injecting insulin about four times a day. For years, I have been waiting for some relief from my daily injection regime. To escape from the daily injections, I have even tried alternative systems like needless pens, etc., without much success.

When I first read about Exubera last year, it seemed to be the perfect solution for my ‘needle’ phobia. Since I have problems injecting regularly, my kidneys are only working at 42% efficiency and are still continuing to decline.

Although Exubera has been approved in the UK, as expected, the conservative medical community has been very reluctant to accept it or to prescribe it.
Their argument against it was mostly based on ‘safety’ and ‘cost’. For the last few months, I have been requesting my GP and my diabetic consultant to prescribe this drug for me. It was a cheaper option than having me on a kidney dialysis machine or even a kidney transplant.

Finally, after much persuasion, I have been able to get their approval last week but only to be informed that Pfizer is now pulling it out of the market. It is shocking for me and I am sure, for many other diabetic patients like me.

For a new drug like Exubera to be accepted by the medical community will take some time. For e.g., although the insulin pump has been around for some years, it is only now accepted by the larger segment of the medical community in the UK, despite the high cost factor.

For a totally new concept like Exubera, the manufacturer needs to have the staying power for at least three to four years while positioning their product in the market, overcoming barriers and fine tuning their marketing campaign.

Most people I meet on a regular basis at the diabetic clinics have not even heard of Exubera! Pfizer should have created more patient awareness of their new product – it seems that they were only targeting the medical community. Patients like me, eager to escape from the ‘needle’ would have pushed our health care consultants.

Pfizer with their sudden withdrawal of this drug have badly let us all down. I am very disappointed.

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