Rezulin's Setbacks Open Door for Competition in the Diabetes Market

Strategic Insights -

Warner-Lambert, the manufacturer of Rezulin, is facing significant challenges in maintaining its market share in the diabetes treatment market. Recently, a US Food & Drug Administration advisory panel imposed strict conditions on Rezulin's use, deeming it safe only when used in combination with other treatments. This decision comes on the heels of a year-long ban in Europe, where Glaxo Wellcome, a partner of Warner-Lambert, voluntarily withdrew a version of Rezulin due to concerns over liver damage. The FDA has documented at least 28 deaths attributed to liver failure caused by Rezulin.

Key Takeaways:

  • The US FDA has restricted the use of Rezulin, allowing its sale only when used in combination with other diabetes treatments.
  • Glaxo Wellcome, the European partner of Warner-Lambert, withdrew Rezulin from the market after it was linked to serious liver damage.
  • The FDA has documented at least 28 deaths due to liver failure caused by Rezulin.
  • Warner-Lambert's market share is expected to decline as competitors SmithKline Beecham and Eli Lilly & Takeda Chemical Industries launch new diabetes products, including Avandia and Actos.
  • By 2005, Mehta Partners forecasts that Rezulin will generate $900m in sales, while Actos and Avandia will reach $2.1bn and $1.3bn in sales, respectively.
  • Rezulin accounted for 7% of Warner-Lambert's sales last year, generating $748m in revenue.

Statistics:

  • 28: The number of deaths documented by the FDA as caused by Rezulin-related liver failure.
  • 7: The percentage of Warner-Lambert's sales attributed to Rezulin last year.
  • $748m: The revenue generated by Rezulin in 1998.
  • 1999: The year the FDA is expected to approve Avandia and Actos.
  • 2005: The year Mehta Partners forecasts that Rezulin's sales will reach $900m.
  • $900m: The forecasted 2005 sales of Rezulin.
  • $2.1bn: The forecasted 2005 sales of Actos.
  • $1.3bn: The forecasted 2005 sales of Avandia.

Sources:

  • Financial Times Limited, 1999.