Companies: Vanda Pharmaceuticals, Novartis
Year approved: 2009
The Promise: For some time, antipsychotic drugs were huge moneymakers for pharma companies, and Novartis hoped it had hit the motherlode when it purchased Vanda Pharmaceuticals, some six months after Fanapt had been approved. It was the second time Novartis gained control of the drug, which had been passed between various companies between inception and approval.
What went wrong: After a strong start in January 2010, garnering $21 million in revenue, Fanapt's sales fell off a cliff. Its second quarter sales were a meager $0.7 million. As The Motley Fool's Brian Orelli puts it, "That's not a typo. Doctors just aren't prescribing Fanapt in large numbers, which isn't all that surprising given the other options."
When it comes down to it, there is too much competition in the antipsychotic industry; between highly regarded brand names and lower-priced generics, Fanapt never had a chance in the market.