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Another Reason to Worry About Pfizer

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As if integration issues from the large acquisition of Wyeth weren't enough, here's another reason to worry about Pfizer (NYSE: PFE  ) : The Food and Drug Administration failed to approve Lyrica as a treatment for generalized anxiety disorder. Again.

The pharmaceutical giant originally got a "not-approvable letter" for using Lyrica as a treatment for anxiety back in 2004. Under the new terminology, this time around, the company received a "complete response letter." By any name, it's still a rejection.

As is typical with pharmaceutical companies, Pfizer didn't elaborate much on the rejection, simply saying that the FDA felt that "data contained in the [New Drug Application] were insufficient to support approval." Whether that means an additional trial is needed remains to be seen.

Pfizer is still holding out hope that the FDA will approve the drug as an add-on therapy for anxiety, even though it wouldn't approve it as a monotherapy.

Lyrica is currently approved as a treatment for fibromyalgia, nerve pain, and as an add-on treatment for seizures. Its biggest rival, Eli Lilly's (NYSE: LLY  ) Cymbalta, is already approved to treat generalized anxiety disorder and depression, so trying to get Lyrica approved for mood disorders isn't particularly weird.

It is rather weird, though, that Pfizer couldn't get Lyrica past the FDA. Large pharmaceutical companies like Pfizer, Merck (NYSE: MRK  ) , GlaxoSmithKline (NYSE: GSK  ) , and AstraZeneca (NYSE: AZN  ) usually have a pretty good feeling for what the FDA needs to approve a drug, especially after they've seen a candidate get rejected in the past.

Maybe the FDA has moved the goalposts for approval -- it wouldn't be the first time -- but Lyrica's latest rejection just seems like one more stumble from giant Pfizer. You know what they say: The larger they are, the harder they fall.

For a contrarian view, Adam Wiederman explains why pessimism can be a good indicator for successful investing.

Pfizer is a recommendation of the Inside Value newsletter. The Inside Value team searches high and low to bring you the best value stocks available. Check it out for free with a 30-day trial.

Fool contributor Brian Orelli, Ph.D., doesn't own shares of any company mentioned in this article. The Fool has a disclosure policy.

Read/Post Comments (2) | Recommend This Article (9)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On December 24, 2009, at 11:50 AM, NostraDammit wrote:

    Attacks on "Big Pharma" seem to have replaced the attacks we used to see against, "Big Tabacco". There always has to be someone to slam and it is currently "vogue" to target the biggest. Makes for great reading. Kind of "tabloid" quality, even in the absense of real steamy scandals.

    The FDA is not an entity to be side-stepped. Industries may try but the bottom line is that if your compound is not right for a particular malady, then it should not approved. To insinuate that Pfizer should be more adept at skirting the FDA does an injustice to the FDA and the professionals at Pfizer and elsewhere in the Pharmaceutical Industry.

    Brian, how about being more responsible?

  • Report this Comment On December 24, 2009, at 1:28 PM, TMFBiologyFool wrote:

    It's not about skirting the FDA. It's about providing the correct information to get the drug approved. If that's not possible (because the drug doesn't work for that indication), then Pfizer has no business resubmitting the NDA.

    My point is that the agency doesn't live in a bubble. Companies have meetings and interactions with the FDA all the time and usually know what the FDA expects for approval. Big pharma is usually more adept because they have more experience in knowing what the FDA wants.


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