Commercial Insight: Osteoarthritis & Rheumatoid Arthritis - New Growth In A Mature Market

TABLE OF CONTENTS

CHAPTER 1 EXECUTIVE SUMMARY 3

• Scope of the analysis 3
• Datamonitor insight into the arthritis market 4
• Despite facing adversity in the past year, including continued negative publicity surrounding the cardiovascular side-effect profile of Vioxx and the delayed launch of key second-generation product Arcoxia, Merck will remain a strong competitor for Pfizer/Pharmacia in the future and the COX-II inhibitor class will continue to flourish through 2011. 5
• The alleviation of Enbrel's supply shortage through the FDA approval of a new manufacturing facility in early 2003 will enable Amgen to regain a significant portion of sales lost to J&J's Remicade although Humira is presenting formidable competition for both of these market leaders; Enbrel sales were $802m in 2002, representing growth of 5% from 2001 sales, while Remicade sales were $1,513m, representing year-on-year growth of 78%. 7
• Summary 9
• Key metrics 11

CHAPTER 2 MARKET SEGMENTATION AND DEFINITION 21

• Strategic scoping and focus 21
• Market definition 21
• Celebrex: the gold standard in osteoarthritis 22
• Associated pharmaceutical markets 24
• Enbrel: the gold standard in rheumatoid arthritis 24
• Associated pharmaceutical markets 26

CHAPTER 3 GLOBAL MARKET OVERVIEW 27

• Key findings 27
• Global arthritis market analysis 28
• Global market forecast 31
• Forecast scenario analysis 33
• NSAID class analysis 33
• NSAID class market performance 33
• Company reported vs. IMS reported growth 36
• NSAID market forecast 36
• Growth of first-generation COX-II inhibitors Celebrex and Vioxx, launch of second-generation COX-II inhibitors Bextra and Arcoxia 37
• Cardiovascular concerns 37
• DTC advertising 37
• R&D drugs in the NSAID class 40
• Celebrex (celecoxib) analysis 40
• Celebrex: 12-month event screen 41
• Celebrex strategic analysis 41
• Celebrex forecasts to 2011 43
• Bextra (valdecoxib) analysis 46
• Bextra: 12-month event screen 46
• Bextra strategic analysis 47
• Bextra forecasts to 2011 49
• Vioxx (rofecoxib) analysis 52
• Vioxx: 12-month event screen 52
• Vioxx strategic analysis 53
• Vioxx forecasts to 2011 54
• Arcoxia (etoricoxib) analysis 56
• Arcoxia: 12-month event screen 57
• Arcoxia strategic analysis 57
• Arcoxia forecasts to 2011 58
• Mobic (meloxicam) analysis 60
• Mobic: 12-month event screen 60
• Mobic strategic analysis 61
• Mobic forecasts to 2011 62
• DMARD class analysis 64
• DMARD class market performance 64
• Company reported vs. IMS reported growth 65
• DMARD market forecast 66
• DMARD class market forecast events to 2011 68
• R&D drugs in the DMARD class 68
• Enbrel analysis 69
• Enbrel: 12-month event screen 69
• Enbrel strategic analysis 70
• Enbrel forecasts to 2011 72
• Remicade analysis 75
• Remicade: 12-month event screen 75
• Remicade strategic analysis 76
• Remicade forecasts to 2011 78
• Kineret analysis 81
• Kineret: 12-month event screen 81
• Kineret strategic analysis 82
• Kineret forecasts to 2011 84
• Arava analysis 86
• Arava: 12-month event screen 86
• Arava strategic analysis 87
• Arava forecasts to 2011 89
• Humira analysis 92
• Humira: 12-month event screen 93
• Humira strategic analysis 93
• Humira forecasts to 2011 95
• HA viscosupplement class analysis 96
• HA viscosupplement market forecast 97
• Synvisc (hylan G-F 20) analysis 99
• Synvisc: 12-month event screen 100
• Hyalgan (sodium hyaluronate) analysis 101
• Supartz (sodium hyaluronate) analysis 102

CHAPTER 4 PORTFOLIO AND LIFECYCLE MANAGEMENT 104

• Key findings 104
• Portfolio management 105
• Market attractiveness 105
• Comparative attractiveness of the arthritis market 105
• Class attractiveness in the arthritis market 107
• Positioning of the major arthritis players 109
• Portfolio analysis 112
• Pfizer/Pharmacia 114
• Merck 116
• Amgen 118
• Johnson & Johnson 120
• Novartis 122
• Aventis 124
• Lifecycle management in arthritis 125
• The arthritis product lifecycle 125
• Osteoarthritis 125
• Rheumatoid arthritis 126
• Launch strategy and market penetration 127
• Case study: unsuccessful vs. successful strategies for the early phase of a me-too arthritis drug's launch 128
• Optimizing peak sales 130
• Large marketing investment early on enables Vioxx to stay strong in the face of negative publicity 130
• Remicade: biologic DMARDs maximize sales through expanded indications 132
• Revenue protection strategies 135
• Novartis's Voltaren: revenue protection through product reformulation 136

CHAPTER 5 STRATEGIC PRODUCT POSITIONING 139

• Key findings 139
• Physician-focused product positioning 140
• Physician targeting strategies 140
• Brand positioning for key products in the osteoarthritis market 142
• Celebrex 142
• Vioxx 142
• Bextra 143
• Case study: Celebrex - the most successful launch in history 144
• Targets of Celebrex promotion 144
• Messages 144
• Lifecycle 145
• Product 145
• Promotional mix 145
• Competition 145
• Budget 146
• Conclusions 146
• Brand positioning for key products in the rheumatoid arthritis market 147
• Enbrel 147
• Remicade 148
• Kineret 148
• Humira 149
• Case study: Enbrel - promotion is meaningless in the face of poor market-sizing evaluations 149
• Road to success 149
• Success stunted by supply shortages 150
• Remicade profits from Enbrel's mistakes 151
• Humira learns from Enbrel's mistakes 152
• Patient targeting and influence 153
• Patient sub-group positioning analysis 153
• Brand imaging: osteoarthritis 153
• Celebrex: "the number 1 prescribed arthritis pain medication" 153
• Vioxx: "one pill for 24-hour relief" 154
• Bextra: "this powerful pill will change the way arthritis pain is treated" 154
• Summary 154
• Patient advocacy initiatives 155
• Brand imaging: rheumatoid arthritis 156
• Enbrel: "the first and only TNF inhibitor approved �c and it can be used alone" 157
• Remicade: just the facts 157
• Kineret: "successfully manage RA through new scientific thinking" 157
• Humira: "RA changed your life, now you can change it back" 158
• Summary 158
• Patient advocacy initiatives 159
• Pricing and reimbursement 160
• Health economic considerations 160
• NSAIDs 161
• DMARDs 161
• Pricing strategies: osteoarthritis 162
• Pricing data for key products in the osteoarthritis market 162
• Case study: why are COX-Iis twice as expensive in the US than in Europe? 163
• Treatment cost analysis: osteoarthritis 166
• Pricing strategies: rheumatoid arthritis 167
• Pricing data for key products in the rheumatoid arthritis market 169
• Treatment cost analysis: rheumatoid arthritis 170

APPENDIX A - MARKET DATA 172

• Global arthritis market data 172
• NSAID market data 173
• DMARD market data 175
• HA viscosupplement market data 177
• Antirheumatic steroid market data 179

APPENDIX B 180

• List of tables 180
• List of figures 183

About Datamonitor 186

• About Datamonitor Healthcare 186
• Datamonitor Healthcare's research and analysis methodologies 187
• Datamonitor Healthcare's therapy area capabilities 187
• About the arthritis analysis team 188
• Datamonitor Healthcare's Consulting expertise 189
• Datamonitor's Therapeutic Consulting expertise 190
• Key therapy team members 191
• Simon Wright, Director Immune Disorders and Inflammation 191
• Disclaimer 192