Sanofi, Lilly prep OTC Cialis to compete against counterfeit ED pills

What's the best defense against all those fake versions of Viagra and other prescription erectile dysfunction pills that are sold online directly to men looking for a boost in the bedroom? Sanofi ($SNY) believes it has the answer: an over-the-counter version of Eli Lilly's ($LLY) ED blockbuster Cialis.

The French drugmaker has confirmed it has agreed to work with Lilly to develop OTC Cialis, according to Bloomberg. Last week, the two companies struck a deal, which Vincent Warnery, senior vice president of global consumer healthcare at Sanofi discussed at a healthcare conference in London earlier this week, Bloomberg says. "The vast majority of men don't consult their doctor on erectile dysfunction," Warnery said during the conference. "Men search online for drugs they can access directly and in doing so, they expose themselves to the huge risks of counterfeit drugs."

Last month, Interpol shut down 10,000 websites selling illicit prescription drugs, seizing 9.4 million medicines, many of which were ED treatments, according to Bloomberg. In 2012, an Internet drug dealer was sentenced to 10 years in jail after agents raided his home in Puerto Rico and found 100,000 counterfeit drugs, including fake versions of Cialis and Pfizer's ($PFE) Viagra.

Counterfeit ED pills sold online have long been a concern of authorities, not to mention drugmakers. The sales represent a competitive threat to Cialis and Viagra, both of which are also facing a loss of market exclusivity in the near future. The drugs each bring in about $2 billion a year in sales. But Viagra's patents have started expiring overseas, and Pfizer reached an agreement with Teva ($TEVA) to launch a generic in the U.S. in 2017. Cialis loses its patent protection starting in 2017, as well.

Using an OTC strategy to combat counterfeits and impending generic competition is not a new idea. Pfizer tried to get an OTC version of Viagra approved in Europe back in 2008, but withdrew its application after EU drug regulators raised concerns and demanded additional data. Andy Tisman, consumer healthcare consultant at IMS Health in London, told Bloomberg he predicts Pfizer may revisit an OTC strategy in light of Sanofi's plan for Cialis. A Pfizer spokeswoman declined to comment, saying only that the company was evaluating the potential for switching several products to OTC status.

Meanwhile, drugmakers are experimenting with a variety of different strategies to lure patients away from online dealers and cheap generics. In March of this year, AstraZeneca ($AZN) launched a direct-to-patient delivery service for Nexium, its $4-billion-a-year heartburn pill that's now facing generic rivals. As for Pfizer, it started reaching out directly to men last year, when it launched an online Viagra marketplace that offers such enticements as three free pills with the first order and a 30% price break on the second order.

-here's the Bloomberg story
-read more at the New York Times (sub. req.)

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