Slow sales mean sinking stock for heart pill maker

Dan Devine

Shares of NitroMed Inc. dropped nearly 25 percent last week as the company continued to report flagging sales of a heart-failure drug indicated for use by blacks.

NitroMed’s stock slumped even though its reported second-quarter shortfall of $18.3 million represents an improvement over a $22.6 million loss during the same period last year. But net losses for the six months ending June 30 totaled $44.2 million, a $2 million increase over the net loss of $42.2 million for the first half of 2005. As a result, NitroMed withdrew its prior prediction that the medication, called BiDil, would account for $20 million in sales this year.

While NitroMed posted a significant loss, BiDil prescriptions grew 20 percent in the second quarter, continuing the growth trend established by a 50 percent prescription increase in the first quarter.

NitroMed estimated that 40 to 50 percent of insured African Americans over age 45 had access to BiDil at a co-pay of $25 or less. Two months prior, 30 percent of African American patients had such access.

However, NitroMed chief operating officer Kenneth Bate said that without knowing for sure how much the increased access will boost sales, the company still felt most prudent projecting a more conservative sales goal than its initial estimate.

“Because of the difficulty at this time of quantifying the impact of those achievements on BiDil prescription growth, as well as the variability in prescription numbers to date, we are withdrawing our previous net sales guidance of $20 million for 2006,” said Bate, who also serves as NitroMed’s chief financial officer.

When BiDil was approved last summer as the first medication approved for use in a specific racial group, some analysts had projected sales would approach $200 million as soon as 2007. But BiDil has failed to gain sales momentum, causing NitroMed’s stock to plunge from its February 2005 high of $27.99 to an all-time low of $2.83 after a 92-cent fall on the NASDAQ Stock Market last Thursday.

Analysts partially ascribe slow sales of BiDil, which combines two existing generic drugs, to physicians who continue to prescribe the separate generics to lower patients’ costs. In May, the Food and Drug Administration released a letter stating that it had approved no drug therapeutically equivalent or substitutable to BiDil.

(The Associated Press contributed to this report.)