Patent expiration–Zocor

Zocor’s patent has expired. The article in the Times describes the financial ramifications on statin manufacturers Merck, Pfizer, Schering Plough, and Astra Zeneca.

Statins (a common class of drugs to lower cholesterol) are big business, in case you ever doubted it. Lipitor generates revenue of 12 billion dollar a year while Zocor generates 10 billion. With profits of drug companies in the 15% of revenue area these drugs are cash cows.

Even considering the drug companies estimate of $800,000,000 (a disputed number) to develop a new drug these revenues imply excessive and remarkable profits–but that’s our system, or is it?

The drug development equation is complex with a long pipeline consisting of basic research, identification of drug candidates, testing for toxicity and efficacy and finally release on the market. Pharma, however, is rewarded with market monopoly’s for 20 years, or more; pricing that seems to have nothing to do with real development costs; and profits that are quite remarkable–see Marcia Angell’s article and book of the same name or John Abramson’s book Overdosed America (review here).

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