When the going got tough, Merck got back to basics. Today, only a few years after a toxic combination of high-profile drug failures and the Vioxx safety debacle seemed like it might doom the company, Merck is way out in front of the industry, churning out big, truly novel new drugs and vaccines at an unheard-of clip, and making massive global launches of complex treatments look easy. The firm has won approval of eight new drugs in the US in the past two years —five of them first-in-class drugs and vaccines—and successfully commercialized Gardasil and Januvia, which Bernstein analyst Tim Anderson projects will make $3-$4 billion a year each by 2012. Its pipeline looks strong, with promising late-stage developmental drugs for cholesterol (Cordaptive, with Zocor or without), migraine (MK-0974) and osteoporosis (MK-0822), among others.
The key to Merck's transformation, insiders say, was an organizational shake-up which brought the commercial and scientific sides of the company into much closer alignment. Through Merck's E2 (or End to End) initiative, “We looked at the whole process of how we bring products to market, from the development process onwards,” says Wendy Yarno, chief marketing officer, global human health, at Merck. “It's listening very carefully to what the market tells us, executing well against the marketing plan, anticipating areas of concern, being nimble in responding to situations that come up and taking advantage of opportunities. In the past, we didn't always have that strong alignment from the CEO on down.”
Dick Clark was the catalyst, initiating the E2 push and chartering the company's first global franchises, for Gardasil and Januvia. “He saw the need for that realignment, for us to be working as one Merck in order to be successful,” says Yarno.
Januvia provides a textbook example of the company's interdepartmental muscle. Anxious to get into the market for type 2 diabetes treatments, Merck put most of its chips on a PPAR agonist dubbed MK-767. “This is one of those diseases custom-made for Merck,” says Jay Galeota, SVP and general manager for diabetes and obesity at Merck. The complexity and progressive nature of the disease, as well as the massive patient population and clear unmet medical need, made it one of the nine categories the company decided to focus on in 2005. “We knew we wanted in, and MK-767 was our lead candidate.” But in 2003, as the company was well into Phase III clinical trials of the compound, Merck researchers began to see cases of a rare cancer in mice receiving the drug. The trials were cancelled and the drug was canned.
“We were very disheartened at that point, but the need didn't go away, so we regrouped quickly and looked at our options,” says Galeota. One was a DPP-IV inhibitor called MK-431, or sitagliptin. But the company was well behind Novartis, whose DPP-IV inhibitor vildagliptin (the future Galvus) was expected to gain approval within several years.
Under Clark, who took over as CEO in May 2005, Merck convened a cross-functional global commercialization team for sitagliptin that brought together development, regulatory, clinical affairs, public affairs, marketing and manufacturing across all regions. They set the bar high, aiming to somehow narrow the gap to claim co-entrant status with vildagliptin.
“We said ‘We can be competitive, but we need to move fast within Merck, align our objectives around common goals, break down the silos and really get close to the customer,” says Galeota.
Also in the loop was Merck's external scientific leadership team, tasked with spearheading a new cross-function initiative designed to help the company better listen to medical-scientific knowledge and opinion leaders for clues as to R&D and trial design. The team picked up a couple undercurrents of interest and concern in the medical community that would prove decisive. One was worries about skin lesions associated with the class, so Merck worked that into its initial battery of trials. After some debate, Merck also included research into the renal effects of the drug, since many patients with type 2 diabetes eventually end up in renal dialysis, and doctors wondered whether sitagliptin would be safe. Those findings helped smooth the way at the FDA.
To meet a tough timetable, Merck settled on a staged Phase III, paring down its initial set of trials to those deemed essential for approval and acceptance by the medical community, with others designed to produce data bolstering additional indications slated to run during the approval process.
“So each of our areas was asked to go back and see what it would take to trim this out to two-and-a-half years —what studies were needed for regulatory, what studies were needed for marketing, what profile we needed at launch,” says Galeota.
Merck also ramped up its outcomes research department to get a feel for how payors, policymakers and other parties impacting reimbursement and adoption of new drugs might receive it.
Januvia, which leverages the body's own ability to create glucose, was a potential breakthrough in type 2 diabetes treatment, because it offered significant efficacy with a very low risk of hypoglycemia compared to traditional treatments—a factor for which Merck ran head-to-head clinical trials against glipozide (Glucotrol). Merck also demonstrated the drug's weight neutrality, negating a concern among the medical community that DPP-IV drugs could lead to weight gain.
Januvia was approved in October 2006, and was followed to market in April by Janumet, the sitagliptin-plus-metformin formula that Merck learned doctors wanted. Two subsequent indications went through. Meanwhile, the agency sent Novartis back to the lab for more trials. It was a nice bit of turnabout for Merck, which suffered an ugly run of bad breaks in R&D earlier in the decade.
“There's luck, but then you make your own luck,” says Yarno. “With Januvia, we did the work that allowed us to get to market sooner and has now delayed our competitors for not doing the same thing.”
US professional advertising for the franchise is handled by Draftfcb, while global professional advertising is being handled by CommonHealth's Noesis.
Gardasil, the HPV vaccine that turned Merck's corporate reputation from disgrace to that of life-saving innovator, has also provided a case study in the company's global marketing muscle. Of course, it always helps to be first in class, but the logistics of the launch were daunting—for starters, Merck had to manage nearly simultaneous reviews in 86 markets around the world, many of them accelerated reviews, in concert with European partner Sanofi Pasteur and Australian partner CSO. Meanwhile, as early as 2003, the firm was laying the groundwork with a global education campaign aimed at helping patients and healthcare professionals draw the link between HPV and cervical cancer, sensitizing the effort to local markets with a widely varying ranges of awareness. Once clinical data were in, showing stunning efficacy and impact not only on cervical but also vulvar and vaginal cancers, Merck shared them with KOLs and professional association meetings worldwide.
Merck also launched a pre-approval HPV awareness campaign with the tagline “Tell someone.”
“One of the insights was that women were shocked to hear of the link between cancer and HPV,” says Bev Lybrand, SVP and general manager, adolescent and adult vaccines at Merck. “We watched those metrics change over time,” from less than 5% in some markets to upward of 50% today.
In addition to TV, print and online ads, Merck's disease awareness efforts included a series of events, for which it collaborated with the Cancer Research Prevention Foundation, called “Make the Connection,” which brought women together at malls throughout the US to make bracelets, work on beading projects and hear docs talk about the HPV-cancer connection.
Similarly, for Januvia, Merck employed innovative disease awareness efforts including a media tour by celebufoodie B. Smith and sponsorship of “conversation map” tools for diabetes educators, on which the company partnered with Healthy Interactions and the American Diabetes Association.
Following the vaccine's June 2006 approval by FDA, Merck switched gears and launched its branded “One Less” campaign, urging young women to be one less life affected by cervical cancer.
“The insight there was that young women really want to be responsible for their own healthcare and take control of their own lives,” says Lybrand, “and moms want to do everything they can to protect their children.” Advertising by DDB NY employed a forthright tone, with young women speaking directly to the camera, meant to communicate authenticity to cynical younger viewers used to being bombarded with health and safety messages in ads.
Branding and professional ads for Gardasil were handled by Juice Pharma, while CommonHealth's Qi handled interactive.
But perhaps the most crucial break for the drug was the decision to include HPV types 6 and 11, which cause most cases of genital warts, along with those that cause most cervical cancers.
The move, another product of Merck's alignment of its scientific and commercial sides, opened up a wealth of potent messaging opportunities—as well as a few new indications, like the one the company is looking at for adolescent males.
A global commercialization team, like that created for Gardasil and Januvia, has been put in place for Merck's most recent approval, novel HIV drug Isentress.
“We want our clinical teams to understand how they need to communicate the data,” says Lybrand. “They're used to the rarified air of KOLs, but a busy pediatrician doesn't want a primer on immunology. It's just a matter of customization of information.”
Getting lab coats and marketers talking to reengage the scientific community and better anticipate opportunities isn't exactly a new concept, says Yarno—it's what made the company great in the first place.
“We're getting back to Merck's strength,” says Yarno. “Understanding what's important about a product is going to determine its success in the marketplace. That's something Merck used to do extremely well—we were always highly regarded in terms of scientific engagement. It helps both in terms of development and as you get into the market—you have the support of scientific leaders. That's always been a core strength of our organization, but we maybe became a little diverted away from that in the days when armies of sales forces became ways to compete.”