NEW YORK (Reuters) - Merck & Co Inc (MRK.N) said one of its most important experimental drugs, blood clot preventer Vorapaxar, was inappropriate for patients who have suffered a stroke, dashing investor hopes and erasing nearly $8 billion from its market value.
Vorapaxar was considered a crown jewel in Merck’s $41 billion acquisition in late 2009 of Schering-Plough Corp and was thought to have multibillion-dollar sales potential.
“The market is wiping it out,” Deutsche Bank analyst Barbara Ryan said of Merck’s 6.7 percent stock decline on the news, suggesting Wall Street considers the drug dead.
Merck said on Thursday it stopped giving the drug to some patients in two late-stage trials at the recommendation of a Data and Safety Monitoring board. Such boards often require changes to trials, or halt them, when safety issues arise, or when a drug shows clear effectiveness or lack of effectiveness.
The setback for the high-profile medicine presents an early challenge for Kenneth Frazier, a longtime Merck executive who just days ago replaced Richard Clark as chief executive.
Frazier has been counting on revenue from Vorapaxar and other Schering-Plough drugs to offset plunging sales of Merck’s $4.8 billion-a-year Singulair asthma treatment, when it faces U.S. generic competition next year. The drug now accounts for about 10 percent of annual company sales.
Sanford Bernstein analyst Tim Anderson said in a research note the possible safety risk and more-limited potential for Vorapaxar “will partly call into question the value of Merck buying Schering-Plough.”
Pfizer Inc (PFE.N) and Sanofi-Aventis SA (SASY.PA) have been stunned in recent years by the failure of top experimental drugs they hoped would cushion the loss of patent protection for their older medicines.
Pfizer drug torcetrapib, meant to raise good cholesterol and garner annual sales of more than $10 billion, was scrapped after a number of patients died in costly trials. Sanofi’s obesity drug, Acomplia, was discontinued because of psyschiatric side effects.
One of the two late-stage Merck trials of Vorapaxar, called TRA-2P, includes patients that have had a prior heart attack, stroke or peripheral artery disease — a condition in which blood vessels typically in the lower part of the body are clogged and disrupt circulation.
The other study, called TRACER, enrolled patients with acute coronary syndrome, meaning patients who have chest pain or a risk of heart attack.
“It does not appear to be appropriate in patients who have had a stroke,” a researcher said in a separate statement issued by Duke University.
Vorapaxar works by blocking receptors to a clotting protein called thrombin. It is often called by its nickname, TRA (thrombin receptor antagonist) and has been deemed a potential blockbuster treatment for heart and stroke patients.
In the TRA-2P trial, Merck said thousands of patients would continue to receive the drug, but only if they have had a previous heart attack or peripheral artery disease. The drug will be immediately discontinued in patients who had a stroke prior to entry into the study or during the study.
On a conference call with analysts, Merck said the respective chairmen of the two trials had not informed the drugmaker why Vorapaxar was inappropriate for stroke patients.
Merck said patients in the TRACER study will no longer receive the drug and the trial will be discontinued in a “timely and orderly fashion.” It said the study had already lasted long enough to achieve its goal of comparing the incidence of heart attacks and other cardiovascular events among patients taking its drug and those taking placebos.
But Merck said some TRACER patients will not continue to receive Vorapaxar through a planned one-year follow-up period.
The company declined to speculate whether excess bleeding had arisen as a side effect of the drug and therefore made it unwise to use among stroke patients.
Merck officials also declined to speculate when an analyst asked if the TRACER trial was being halted because of signs of overwhelming drug effectiveness.
“It appears that excessive bleeding may have been the culprit,” Anderson said in his note, adding the side effect is often seen with anti-clot medicines.
Merck shares were down $2.42, or 6.5 percent at $34.73 in afternoon trading on the New York Stock Exchange.
Reporting by Ransdell Pierson and Lewis Krauskopf; editing by Gerald E. McCormick, Dave Zimmerman, Tim Dobbyn and Andre Grenon