Shares of Merck & Co. and Schering-Plough Corp. fell Monday morning after the companies said they will report data from a clinical trial of cholesterol drugs Vytorin this afternoon.
The companies said they will present an update from a trial of Vytorin as a treatment for aortic stenosis, a condition in which the valve in the largest artery in the body becomes narrower, and the flow of blood is impaired. The update will be presented at 1 p.m., and both companies delayed their second-quarter earnings until after the closing bell.
The companies market the drug under a joint venture.
Deutsche Bank analyst Barbara Ryan said most analysts don't expect the drug to show any benefit in treating the disease. Wall Street appeared to be concerned that, like January's ENHANCE study, the results will damage sales of Vytorin. Shares of Schering-Plough lost $2.49, or 11.6 percent, to $18.95, and Merck stock fell $2.35, or 6.2 percent, to $35.33.
The trial, called Simvastatin plus Ezetimibe in Aortic Stenosis or SEAS, compares Vytorin's components, Zocor and Zetia, respectively, to a placebo. The companies hope to show that aggressively cutting cholesterol will slow the development of aortic stenosis, leading to fewer heart attacks and strokes, and reducing the need for valve-replacement surgeries, which are the normal treatment for the condition.
Goldman Sachs analyst James Kelly said the most likely results of the study are that Vytorin led to no significant changes, or that it slowed the progression of aortic stenosis but didn't reduce the cardiovascular problems connected to the disease.
"The key risk in these two scenarios could be the impact of media coverage," he said. "If Vytorin is yet again characterized as an expensive agent with low effect, prescriptions could be negatively impacted."
Cowen and Co. analyst Steve Scala said the trial results might be positive because Vytorin may reduce ischemic events, or reductions in blood supply. But that won't do much to improve sales, he said.
Sales of Vytorin slumped after results from the ENHANCE trial were reported in January. The data showed that Vytorin was no more effective in reducing plaque buildup than Zocor alone. Lower-cost generic versions of Zocor have been available since 2006.
U.S. sales of Zetia and Vytorin fell 5 percent in the first quarter, and Merck lowered its revenue expectations from the joint venture by $700 million. Total sales of the drugs reached $1.2 billion in the first quarter.
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