Cliffs notes on expiring patents

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Often, when I am exposed to certain words and phrases, it acts as a cue for my mind to break into an accompanying composition of incidental music and fitting sounds effects.

In pharma circles, the term “approaching the patent cliff” always triggers a tense, screetching, booming score, serving up fear and suspense in Hitchcockian proportions, and conjuring images of color-drained, terror-stricken faces with hands over mouths. (Da… da… daaaa!)

For the vast majority of normal folks not blessed with neural orchestras, “the patent cliff”  is almost invariably associated with the plight of pharmaceutical companies in particular, and their quest to replace lost revenues as patent law prepares to call time on a clutch of their big-time blockbuster brands.

But it's not just manufacturers that need to build up their cliff defenses. A quick analysis of the latest DTC spending figures from The Neilsen Company shows the potentially devastating effect on agencies, too, and on DTC media as a whole.

Of course, it's not exactly rocket science that fewer blockbuster drugs will result in fewer marketing dollars for agencies. But it wasn't immediately obvious to me just how much is accounted for by late-stage blockbusters.
On the face of it, the numbers are encouraging: total DTC spend in 2009 increased by 2% to $4.5 billion, halting the slide of the previous two years. But who is actually spending these DTC dollars, and, more to the point, what brands are they supporting?

The two biggest spenders, Pfizer and AstraZeneca, increased their DTC outlays by 37% apiece, and together they accounted for around one-third of total spend in 2009. Pfizer was way ahead of the pack, however, with an ad spend three times that of AstraZeneca's, at $1.1 billion.

That's all very well, but when you look at the products that are being supported, there seems to be something of a trend for throwing DTC dollars at mature brands.

For example, four of the top 11 most advertised drugs will lose patent in the next two years: Pfizer's Lipitor ($244 million in DTC 2009; patent expires 2011), Bristol-Myers Squibb/Sanofi-Aventis' Plavix ($152 million; 2011), AstraZeneca's Symbicort ($142 million; 2012) and Pfizer's Viagra ($129 million; 2012). Together, they add up to $670 million and represent a significant 15% of the total DTC spend in 2009. And that's just four brands. Beware, for there are others heading cliff-ward.

Housekeeping
Like hundreds of your industry peers, right now you probably have your mind fixed firmly on the MM&M Awards. And I know what you're thinking: “I've downloaded all the entry information already from mmm-online.com, and I'm aware I have until May 28 to submit my work—but how can I really impress the judges and get my hands on such a coveted trophy?”

Fear not, for help is at hand. On pages 36-37 you will find numerous valuable dos, don'ts and other tips for completing your submissions just the way the judges like it. Plus we feature three of last year's winning campaigns and take a look at why they triumphed. Happy entering.

One more thing: MM&M's readership is 100% qualified every year, so to ensure you continue to receive your copy of the print magazine, go to www.mmm-online.com/JamesSentMe to renew your subscription
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