Pfizer Blockbuster Zyvox Under Attack

Incoming competition for Pfizer's $1.4 billion Zyvox market is threatening on multiple fronts.

Apr 8, 2014 at 9:30AM

Incoming competition for Pfizer's (NYSE:PFE) $1.4 billion Zyvox market is threatening on multiple fronts. With several important revenue streams drying up, this one has become more important than ever to the drug company.

Recently, an FDA advisory committee smiled on potential competitors from Durata Therapeutics (NASDAQ:DRTX) and Cubist Pharmaceuticals (NASDAQ:CBST). Let's take a closer look at what's coming.

Expiration dates
Pfizer owns three U.S. patents that protect the antibiotic Zyvox. It is typically used to treat infections caused by Gram-positive bacteria resistant to other antibiotics. Patients with severe conditions can receive it via infusion, or injection, then switch to pills when leaving the hospital. The basic product patent expires in May 2015, but those concerning delivery methods extend further. A patent on the crystalline form that enhances the solubility of the injectable formulation expires in June 2018. Another patent related to tablet formulation expires in 2020. 

Teva Pharmaceutical (NYSE:TEVA) already has an approved injectable generic version waiting in the wings. Pfizer might take a shot at preventing generics from entering the market following expiration of the basic product patent, though. With annual sales of about $1.4 billion, it's certainly worth the effort.

Safety and convenience
Generic competition aside, Zyvox sales could begin falling even earlier. Two separate antibiotics that are likely to compete with the blockbuster have a chance of hitting the U.S. market before the end of the year.

Late last month, an FDA advisory committee voted unanimously in favor of Durata Therapeutics' dalbavancin. The FDA isn't required to follow the recommendation, but it sometimes does -- so stay tuned for more information here.. 

During the late-stage Discover trials, investigators measured outcomes for patients with acute skin infections given either dalbavancin, or vancomycin followed by Zyvox. Dalbavancin was non-inferior to the combination, but the results were extremely close.

While Durata's antibiotic might not be able to compete on efficacy alone, it wins big with higher marks for convenience. Patients in the combination arm received twice daily vancomycin infusions, followed by oral Zyvox after two to three days. Dalbavancin patients received infusions once weekly.

In terms of safety, 32.8% of patients receiving dalbavancin experienced adverse events, versus 37.9% of patients in the vancomycin/linezolid arm. With just 1,303 patients the difference was not wide enough to be considered statistically significant. Significant differences dalbavancin's favor included the total number of drug-related adverse events, and death. 

Cubist Pharmaceuticals faced an advisory committee on the same day as Durata. The company's antibiotic tedizolid also received a unanimous recommendation for approval.

Unlike Durata's Discover trial, Cubist's Establish study measured tedizolid head-to-head with Zyvox alone and achieved similar results. Overall, Cubist's antibiotic was slightly more effective than Pfizer's, but not enough to claim outright superiority. Like dalbavancin, tedizolid patients experienced fewer adverse events. Patients in the tedizolid arm were treated once daily for six days, and 20.5% reported adverse events. Zyvox patients were treated twice daily for 10 days, with 24.8% reporting adverse events.

Doesn't add up
The sad irony of this story is that Pfizer used to own dalbavancin. The company took it all the way to the goal line before regulators moved the posts. Zyvox comprised 2.2% of Pfizer's annual revenue when the company sold its potential replacement to Durata at the end of 2009. Durata paid Pfizer just $10 million upfront for dalbavancin, and agreed to a $25 million milestone payment following its first approved sale in a major market.

I applaud Pfizer's relatively successful restructuring efforts, but the decision to let go of a winner like dalbavancin for next to nothing is a real head-scratcher.

Final take
If approved and competitively priced, either of the new branded antibiotics could pose a more immediate threat to Zyvox sales than next year's generics. Their pivotal studies strongly suggest that they're not inferior, and less frequent dosing is a plus. The problem is, both might have trouble competing with cheap generic Zyvox going forward. Cubist's tedizolid requires fewer treatments, but that's really it's only significant advantage. Durata's dalbavancin has an arguably better safety profile, but it might not be enough for government payers to overlook an inexpensive alternative. 

This stock could make you wealthy
There’s a huge difference between a good stock and a stock that can make you rich. The Motley Fool's chief investment officer has selected his No. 1 stock for 2014, and it’s one of those stocks that could make you rich. You can find out which stock it is in the special free report "The Motley Fool's Top Stock for 2014." Just click here to access the report and find out the name of this under-the-radar company.

Cory Renauer has no position in any stocks mentioned. The Motley Fool recommends Cubist Pharmaceuticals and Teva Pharmaceutical Industries. The Motley Fool owns shares of Cubist Pharmaceuticals. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Money to your ears - A great FREE investing resource for you

The best way to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as “binge-worthy finance.”

Feb 1, 2016 at 5:03PM

Whether we're in the midst of earnings season or riding out the market's lulls, you want to know the best strategies for your money.

And you'll want to go beyond the hype of screaming TV personalities, fear-mongering ads, and "analysis" from people who might have your email address ... but no track record of success.

In short, you want a voice of reason you can count on.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich," rated The Motley Fool as the #1 place online to get smarter about investing.

And one of the easiest, most enjoyable, most valuable ways to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as "binge-worthy finance."

Whether you make it part of your daily commute or you save up and listen to a handful of episodes for your 50-mile bike rides or long soaks in a bubble bath (or both!), the podcasts make sense of your money.

And unlike so many who want to make the subjects of personal finance and investing complicated and scary, our podcasts are clear, insightful, and (yes, it's true) fun.

Our free suite of podcasts

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. The show is also heard weekly on dozens of radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable. Rule Breaker Investing and Answers are timeless, so it's worth going back to and listening from the very start; the other three are focused more on today's events, so listen to the most recent first.

All are available for free at

If you're looking for a friendly voice ... with great advice on how to make the most of your money ... from a business with a lengthy track record of success ... in clear, compelling language ... I encourage you to give a listen to our free podcasts.

Head to, give them a spin, and you can subscribe there (at iTunes, Stitcher, or our other partners) if you want to receive them regularly.

It's money to your ears.


Compare Brokers