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Gardasil: The Merck Blockbuster That Wasn't


Seeking approval to market the HPV vaccine to older women.

Merck (MRK) is still hoping that women ages 27 to 45 will want to be "one less". But one less might not be enough.

The Big Pharma company said in a statement on its website that it's still pursuing the approval of its HPV vaccine Gardasil for older women, emphasizing that the FDA typically takes six months to review a drug for a new indication. The company got a no-go from the agency early last year when it was asked for further evidence that the vaccine was effective in women over the age of 26. That was the second time that the new indication has been passed over.

Gardasil is approved for the prevention of the human papilloma virus. There are more than 100 different strains of HPV and 15 of those are known to cause cervical cancer. Vaccines like Gardasil are made to prevent only a few of the 15 strains that cause cervical cancer, but can still significantly reduce the risk of getting the deadly cancer. Cervical cancer is the second-leading cause of cancer-related death in US women ages 20 to 39, after breast cancer. There are an estimated 3.5 million abnormal Pap smears annually in the US, and more than 1.5 million precancerous lesions diagnosed.

Despite the huge population that the vaccine caters to, Merck has seen its share of disappointments with the drug since it hit the worldwide market in 2006. It was originally approved for women ages 9 to 26 years old, but the pharma company had trouble getting the idea of a cervical cancer vaccine to catch on with that age group.

Aside from problems getting women over 20 to consider the vaccine, there was plenty of backlash from moms who weren't sure the vaccine was safe for their young girls and from religious groups that felt it was a promotion for unsafe sex. (Both of these concerns eventually died down, but could still be reasons for the drug's lackluster performance).

Merck has continued to see sales of the drug drop; worldwide sales fell 25% year-over-year to $841 million in the first nine month of 2009. Merck has tried all sorts of things to help fix the sales problem with Gardasil. It's likely you've seen the company's advertising for the vaccine that is played on most networks and has young girls chanting that they want to be "one less".

In January 2009, the company shuffled leadership on the Gardasil project in hopes of affecting change. Merck even got approval from the FDA in October 2009 to expand the vaccine to the prevention of genital warts in boys and men. Yet nothing has pushed the company to expand its sales forecasts for the drug, which Merck has consistently guided to be just above $1 billion each year that Gardasil has been on the market.

While the vaccine may be considered a blockbuster by conventional standards (it typically has annual sales over $1 billion), Gardasil isn't seeing the numbers it should considering the size of the market and the fact that there have been no competitors in the US market until just recently.

GlaxoSmithKline (GSK) got approval for its cervical cancer vaccine in October 2009 (the same day the FDA approved Gardasil for men). Glaxo's Cervarix has been available in Europe for years and has been one of the major reasons that Merck has had disappointing sales outside of the US.

While analysts don't expect Cervarix to catch on in the US, the new competition could mean one less shot in an American arm with Gardasil.

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