What the flu bug will bring in any given year is a bit of a guessing game, and this year drugmakers got it wrong. A tough year for the flu has run drugmakers short on vaccine and treatment. Still, with demand for flu vaccine and Tamiflu running rampant, it will mean a boost to sales for those companies that make them.
Roche ($RHHBY) told Reuters that it is running short of Tamiflu, its drug that shortens the duration of a bout of influenza. The company warned distributors to expect delays in getting the liquid form that is usually given to children. In December, the FDA extended its approval of Tamiflu for acute, uncomplicated influenza in infants 2 weeks of age and older, potentially adding to demand. In Canada, the government has agreed to tap its stockpile of Tamiflu to help the company deal with shortages there.
A rush for vaccinations also caused Sanofi ($SNY), the key flu vaccine maker for the U.S., to sell out of four of 6 dosages of its Fluzone seasonal vaccine, Reuters reports. All of the companies that produce the vaccine projected that they would manufacture 137 million doses this season. As of a few weeks ago, the Centers for Disease Control and Prevention estimated that 112 million people in the U.S. had already stepped up for a shot, more than 80% of the anticipated production. Of that, Sanofi had projected that it would make 60 million doses and GlaxoSmithKline ($GSK) had planned to make 25 million doses.
While a problem for patients and providers, it is not all bad for drugmakers. Morningstar analyst Karen Andersen told Reuters that she expects Tamiflu sales to hit about $750 million this year, more than twice the $350 million from last season. She forecast that will translate into a 1% boost to Roche's revenue, not large but nothing to sneeze at. Still, these numbers pale in comparison to those for 2009, when many governments stockpiled Tamiflu in expectation of a pandemic that never came. That year, Reuters reports, sales reached $3 billion.
Officials in Canada this week decided they could use some of their stash to mitigate the current shortages. "Given that we are still in the midst of influenza season and given that we certainly do not want to have any kind of supply disruption at this point in time, the Public Health Agency Canada … has elected to work with Roche to ensure that there will be no supply disruption," Dr. Barbara Raymond, director of pandemic preparedness, told the Ottawa Citizen.