Heart pill maker slashes sales staff

Dan Devine

Lexington-based drug company NitroMed Inc., maker of a heart medication approved only for black patients, announced last Wednesday the firing of its entire 120-person sales team. The “restructuring” replaces the fired sales staff with a small, “elite” team of experienced physicians, a move NitroMed expects will save the company $30 million per year and improve marketing of its drug BiDil.

“Sales of BiDil have grown steadily, but they are not growing at a rate that supports the present sales structure,” said NitroMed chairman and CEO Jerry Karabelas in a statement, later saying the company’s prior selling strategy was “not economically viable” in a conference call.

BiDil, approved by the Food and Drug Administration for use by the country’s estimated 750,000 blacks with heart failure, is the first drug approved for use in a specific racial group. The tablet combines two generic medications that make it easier for the heart to pump. Because the two generics are inexpensive and already covered by most insurers, many managed care organizations and pharmacy benefit managers have been reluctant to pay brand-name prices for BiDil.

The restructuring is the latest in a series of shakeups at NitroMed aimed at improving weak sales of BiDil.

After receiving FDA approval of the drug in June 2005, NitroMed originally hired 190 marketers on a contract basis to sell the heart drug to a wide range of physicians. But slow progress in convincing drug plans to give BiDil preferred placement on their formularies stunted sales. In March, then-CEO Michael Loberg and chief financial officer Lawrence Bloch resigned their posts. Later that month, the company eliminated 30 research and development positions, citing a shift in its primary focus from R&D to sales and marketing.

Part of that shift included bringing 144 of the contracted marketers on-board as NitroMed employees. The altered strategy focused on grassroots direct-to-consumer efforts, such as presentations at community meetings and predominantly black churches in cities with large African American populations. In September, NitroMed began running radio and print advertisements in Detroit, Houston and Washington, D.C., in the hope of generating greater name recognition in the population for which BiDil is specifically indicated.

Jane Kramer, vice president of corporate communications at NitroMed, said the targeted three-city media campaign will continue, but information as to whether or not it is succeeding in making people more aware of BiDil won’t be available for another month or so.

While the advertising and grassroots efforts will continue, the “revised strategy” announced last week again drastically changes NitroMed’s sales approach. An “elite” team of cardiovascular experts, which the company said is still being hired, will work with NitroMed’s medical science liaisons (MSLs) to sway decision-makers with influence on a large number of African Americans diagnosed with heart failure, such as regional heart failure specialists, health plans and medical centers in major cities treating a large number of potential prescribers.

Kramer called the emphasis on reaching national and regional opinion leaders as well as hospitals something the company “really hasn’t done before.” She said that the new staff of specialists and MSLs will provide physicians with samples of BiDil, along with clinical information about the positive effects the drug has been shown to have.

Liana Moussatos, an analyst with Pacific Growth Equities, told The Associated Press that if NitroMed hadn’t cut its sales force, the company would have run out of cash in the first quarter of next year. The estimated $30 million in annual spending saved by the revision “maybe … gives them a little bit [of] extra time,” she said.

NitroMed plans to use that extra time to accelerate development of BiDil XR, a new drug that Karabelas said is ahead of schedule but has not received regulatory approval. While the current form of BiDil is an immediate release pill that must be taken three times a day, the XR formulation — short for “extended release” — can be taken once a day.

Financial analysts have suggested that if NitroMed can get swift FDA approval of BiDil XR, the fewer doses could mean lower costs, making the drug more appealing to both patients and investors. Kramer said the company will not provide details on the timeline for clinical trials or regulatory approval of XR until early 2007.

“We don’t think that [the cuts are] necessarily going to improve sales,” Kramer said. “The objective is to maintain and sustain a presence in the market and to make certain that BiDil is available to every patient that needs it until such time as we have the extended release version ready.”

(The Associated Press contributed to this report.)