Sleeping pill makers likely to start ad war

NEW YORK -- The maker of Ambien has begun a new ad campaign it hopes will reverse a sales slide triggered by reports that some patients couldn't recall driving or eating while sleepwalking when using the prescription sleep aid.

The campaign Sanofi-Aventis SA launched last week is likely the first salvo in what analysts predict will be a fierce advertising war in the market that has seen sales drop in the aftermath of the negative news. Sanofi's Ambien is expected to have a new competitor by this summer when Pfizer Inc. and partner Neurocrine Sciences Inc. are slated to debut a new pill.

Analysts expect the ads to flood the media just as the commercials for erectile dysfunction treatments like Viagra, when that drug added new competition.

"You are not going to be able to watch a television show without seeing a commercial for a sleeping pill," said Jason Napodano, an analyst at Zacks Independent Research.

Pfizer's pill -- known generically as indiplon -- will compete head-on with Ambien and Lunesta, a prescription drug that Sepracor Inc. began marketing 11 months ago as a way for the sleep-deprived to get a good night's rest.

Sleeping pill prescriptions grew 55 percent to 45.5 million from 2001 to 2005, according to IMS Health, a pharmaceutical market research firm.

Six-month-old Ambien CR, the successor drug to the headline-grabbing medicine, had been steadily gaining market share since last October. Unlike its predecessor, Ambien CR is approved to help maintain sleep and for long-term use. But after publicity about the negative side effects for some Ambien users surfaced earlier this month, sales of it and other sleep aids have slowed.

Verispan, which tracks prescription data, reported that in the two weeks ended March 17, total sleeping pill prescriptions fell 9 percent to 842,561 while new prescription declined 8 percent to 465,233. New Ambien prescriptions fell 12 percent to 211,902, while Lunesta's dropped 4 percent to 63,589 and Ambien CR's shed 13 percent to 61,366.

Ambien CR, Lunesta and indiplon are all in the same class of drugs as Ambien so there is a chance they may all have similar side effects, said Dr. Stasia Weiber, director of the sleep clinic at Mount Sinai Hospital in New York.

Yet even with the negative publicity, many doctors said they feel comfortable prescribing Ambien to patients, noting it has been on the market for 13 years and the side effects are rare. Sleep specialists say they were aware of Ambien's potential problems.

"I don't think it is a deal breaker," said Dr. Timothy Komoto, a family physician in Minneapolis who acknowledged he hadn't heard about Ambien's alleged side effects before the news reports surfaced.

Earlier this month, lawyer Susan Chana Lask filed a lawsuit in federal court in New York City on behalf of several plaintiffs that alleges Sanofi-Aventis failed to adequately warn of Ambien's potential dangers and that the drug caused her clients to enter a trancelike state and engage in dangerous activities that caused various types of damage.

Sanofi-Aventis spokeswoman Melissa Feltmann said Ambien is safe and that the company will defend itself against the suit. She said the company has warned about the possible side effects since the drug's launch. The prescribing information for doctors lists somnambulism -- sleepwalking -- as a rare side effect. People have been known to eat or drive while sleepwalking.

In the coming battle, Lunesta may have the toughest time holding on to insomniacs.

Lunesta's maker Sepracor is dwarfed by Pfizer and Sanofi-Aventis in terms of revenue and resources, analysts noted. Pfizer is the world's largest drug company and Sanofi-Aventis is third.

"They (Sepracor) should be worried," said David Woodburn, an analyst at Prudential Equity Group LLC.

Massachusetts-based Sepracor spent $215 million last year to advertise Lunesta, according to TNS Media Intelligence. It wouldn't comment on its future marketing plans.

Ian Sanderson, an analyst at Cowen & Co. said Lunesta ad spending was more than the company forecast -- and more than twice his estimate. He said that could be a sign Sepracor is trying to "throw money on the problem" ahead of the increased competition. Sepracor's stock is down about 15 percent this month, and analysts said one reason is the expected competition for Lunesta. It rose 68 cents to $48.59 Wednesday on the Nasdaq Stock Market.

Sanofi-Aventis spent $42 million last year advertising Ambien CR. Its ads offer patients a free seven-day prescription. The company took out a full-page ad in The New York Times and several other newspapers including the Wall Street Journal and Los Angeles Times on Wednesday to reassure consumers that Ambien is safe.

The ads, which also remind patients to take the medicine as directed, will also appear in weekly magazines such as Newsweek. No TV commercials are planned, and a Sanofi-Aventis spokeswoman said she wasn't sure how long the campaign would run.

Last year, Pfizer pledged not to advertise any new drugs directly to consumers for six months so doctors have an opportunity to learn about the medication before commercials generate demand. That means ads for the drug wouldn't start until at least year's end, which could help Lunesta in the short-term, analysts said.

In the meantime, however, Pfizer's massive sales force will blanket physicians' offices to tout indiplon.

The big question mark in the sleeping pill market is how sales of the entire group will be affected once there is a cheap, generic version of Ambien available. Ambien's patent expires in October but is expected to be extended for six months for testing the drug on children.

With health care costs rising dramatically, managed care companies have been aggressively pushing cheap generics to save money. It is unclear if managed care will take drastic steps to push patients to generic sleeping pills, but if they do it could curb sales of the newer medicines.