AstraZeneca is staring down the barrel of its Nexium patent loss, but it's doing its best to dodge the bullet. In a bid to keep patients hooked on the branded version of that purple pill, the company will let Nexium patients order the drug online--and at a discount.
The U.K.-based drugmaker ($AZN) launched Nexium Direct, a mail-order service that allows patients to order 30- to 90-day supplies of the stomach-acid pill. Patients sign up online and send over their doctors' prescriptions; there's a 24-hour support center to turn to if they have trouble. The program also includes an automatic copay discount, under AstraZeneca's existing co-pay program. So, the most that most commercially insured patients pay is $25 per month. They can also ask for automatic refills, which makes it easier for patients to stick with therapy--and easier for AstraZeneca to keep the sales coming.
The direct-sales approach comes at a time when consumers are getting more health information and assistance online. Almost three-fourths of internet users searched online for health info last year, an AstraZeneca spokeswoman pointed out in an email.
"Today, people are taking a more active, participatory role in their healthcare," AstraZeneca VP Linda Palczuk said in a statement. "With this in mind, AstraZeneca [is] giving patients and prescribers a choice when it comes to how they receive branded NEXIUM from AstraZeneca."
It's not the first time a drugmaker has rolled out direct sales to entice patients to stick with their branded meds after generics hit the market. Pfizer ($PFE) did something similar as its Lipitor monopoly wound down. The Lipitor direct-sales program not only included copay discounts but also limited charges to their insurance companies. Payers that contracted with the company forked over no more for branded Lipitor than they would for a generic.
Nor is it AstraZeneca's first experience. The company used the same strategy with Arimidex Direct, to provide its breast cancer treatment for $40 per month after the drug went off patent. In that case, the pharmacy benefits manager Express Scripts ($ESRX) fulfilled the drug orders; with Nexium, the specialty pharmacy Eagle Pharmacy is doing the honors.
And there are other reasons for direct sales, too. Pfizer's other direct-to-patient program delivers its famous erectile dysfunction remedy, Viagra. The drug is still on patent, but counterfeits are abundant. Plus, men who might be embarrassed to fill a prescription at a pharmacy can order the familiar blue tablet discreetly online.
For AstraZeneca, though, it's all about protecting its Nexium turf. The drug brought in $3.87 billion for the company last year, and generic competition is due in May. With generics maker Ranbaxy Laboratories in hot water with the FDA again, that debut could be delayed. But in the meantime, the company needs to shore up its defenses as much as it can.
- read the AstraZeneca statement
Special Report: Top 10 drug patent losses of 2014 - Nexium
Editor's note: The story was revised to clarify Nexium Direct's focus on direct delivery of the drug, with easier access to existing copay assistance.