UPDATE 2-Pfizer aims to keep one-third of Lipitor pie
* Says 1 million U.S. patients want to stay on brand
* Sees quick 20-30 pct fall in price of Lipitor, generics
* U.S. patent of top-selling drug lapses after 14 years
* Watson confirms it begins shipping generic Lipitor
By Ransdell Pierson
Nov 30 (Reuters) - As cholesterol fighter Lipitor goes generic, its maker Pfizer Inc is hoping to hold onto perhaps a third of the 3 million Americans who take the biggest-selling drug of all time.
Lipitor, which became available in 1997 and generated annual sales of $13 billion at its peak, reduces "bad" LDL cholesterol and the risk of heart attack and stroke. It loses U.S. patent protection on Wednesday.
"More than one-third of patients currently taking Lipitor would like to stay on Lipitor," David Simmons, president of emerging markets and established products for Pfizer, said on Tuesday, citing internal company research.
Pfizer is employing unprecedented tactics to hold onto as many Lipitor prescriptions as it can during the first six months of generic competition, when only two copycat versions will be on the market. It plans to pull back on the aggressive marketing plan afterward, when a slew of other generics will be introduced.
Watson Pharmaceuticals Inc will sell an "authorized generic" form of Lipitor made by Pfizer, with an estimated 70 percent of its sales going to Pfizer. Watson said early on Wednesday it has begun shipping the pills, calling it the "largest generic product launch in U.S. history."
Indian drugmaker Ranbaxy Laboratories Ltd is also ready to sell its copycat Lipitor as the result of a settlement reached with Pfizer in 2008. But the actual launch depends on whether U.S. regulators lift a ban that has kept Ranbaxy from exporting some products to the United States following quality control lapses at the company's Indian factories.
Analysts said on Wednesday there was no sign Ranbaxy had begun shipping its version of Lipitor to pharmacies to be sold under its chemical name atorvastatin, a delay that could benefit Pfizer.
Ranbaxy officials did not return calls. A U.S. Food and Drug Administration spokeswoman declined comment on the status of Ranbaxy's generic Lipitor, saying the agency did not discuss pending drug applications.
Some industry watchers expected Israel's Teva Pharmaceutical Industries Ltd to step in and help supply Ranbaxy if the FDA did not approve shipments from its main facility in Paonta Sahib, India.
"It's hard to know whether the FDA will approve Ranbaxy's product, or whether Teva will become involved, but we should know by midnight," Sanford Bernstein analyst Aaron Gal said. Teva officials could not immediately be reached for comment.
Teva shares were up 3 percent on the Nasdaq in afternoon trading, while Ranbaxy closed down 3.9 percent in India. Watson shares slid 0.7 percent, while Pfizer rose 2.8 percent, both on the New York Stock Exchange, amid sharp gains for the broader market.
PROTECTING THE BRAND
Watson has forecast branded Lipitor will keep 40 percent of its prescription volume in the next six months. That is about twice as much as brand companies typically retain in the initial 180-day period, according to Leerink Swann analyst Jason Gerberry.
Why would patients prefer Lipitor even though Watson's generic is identical to the branded product and Ranbaxy's generic has the same active ingredient?
"When I go into a pharmacy and if I'm going to be dispensed a generic, I have no idea where it is coming from," Simmons said. "I know if I get Lipitor, I know it's coming from Pfizer."
Pfizer said it reached deals with some health insurers and pharmacy benefit managers (PBMs) -- firms that negotiate drug prices for companies and health plans -- that will allow patients to obtain branded Lipitor at similar or even lower co-payments than those assigned for Lipitor generics.
The arrangements also mean health insurers working with Pfizer will pay no more for branded Lipitor than for the generics, Simmons said.
He forecast the cost of the generics would likely be 20 percent to 30 percent lower than the original price of Lipitor during the first six months and fall dramatically afterward.
Pfizer is offering patients a card that covers all but $4 of their co-payment for Lipitor, up to a maximum discount of $50. It can be ordered at the website LipitorForYou.com.
Lipitor has chalked up more than $130 billion in sales during its 14 years on the market and many investors doubt another drug of its magnitude is likely any time soon.
But industry experts say a major advance in treating diabetes, obesity or Alzheimer's disease would have a good shot at matching or even eclipsing Lipitor's gargantuan sales.