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The Stiff Competition Facing Viagra: Here’s Why Prices Are Falling

As Viagra turns 21 this year, we take a look at the falling prices for this popular performance enhancing, pharmaceutical.

Once a prescription only drug, Viagra now faces competition with the rise of widely-available generic alternatives. Not only that but there some new contenders on the market to treat erectile dysfunction (ED) with some of them offering a far more potent ‘kick’. With Pfizer’s U.S. patent due to finally expire in April 2020 on the famous little blue pill, men in the United States will soon have an even wider choice available to them.

In this feature, we take a look at the timeline of Viagra and why Pfizer, who once held a monopoly on the world’s ED treatment market, is now facing stiff competition.

Viagra: The Timeline

Hitting the market in 1998, sildenafil was the world’s first oral drug to treat erectile dysfunction. Better known by its brand name, Viagra, this potent ‘little blue pill’ has been given near mythical status as the answer to the prayers of both men who suffer from ED as well as addressing the age-old problem of having enough stamina in the bedroom.

A potent drug which can work within 25-minutes of being administered and potentially providing enough pep in your step to maintain an erection for around 2-3 hours….sometimes more…Viagra has been hailed as a miracle drug.

Originally discovered by Pfizer in 1989 and trialed the following year as a treatment for coronary heart disease, penile erection was noticed as one of the more consistent side effects in male patients. However it wasn’t until 1996 that the drug was finally patented.

This drug was given the name ‘sildenafil’ and works by inhibiting the enzyme phosphodiesterase type 5, known as a PDE5 inhibitor. PDE5 is present in the smooth muscle cells which line blood vessels found in both the lungs and the penis and can decrease blood flow to these areas. Inhibitors, such as sildenafil, work by increasing blood supply to these organs. Pay attention to this, we may be asking questions later.

After various trials conducted by Pfizer, the findings of which were published in The New England Journal of Medicine in 1998, the drug (branded as ‘Viagra’) was finally approved by the FDA in March of the same year. The European equivalent, EMA, approved Viagra in September 1998 and was the first oral treatment for men to treat ED.

The rest of the story, as they say, is history and sales of Viagra secured Pfizer a solid financial grounding. You can see from this market summary graph that shares in the company sky-rocketed around the launch of the drug and have recovered well over the last decade since the financial crash of 2007/2008. So much so in fact that the current trading history is similar to the peaks of early-1999 when Viagra was beginning to pick up more media attention.

share prices pfizer viagra sales

Pfizer Inc.’s stock market star ascended with the launch of Viagra. Image via Google.

Viagra: Why Pfizer’s Time at the Top is Coming to an End

When a new drug is brought to market, the pharmaceutical company is granted a patent to protect their ‘discovery’. In addition, the sole rights for supply are given under license by the prevailing regulatory authorities for each region where the drug will be prescribed.

This practice is standard and enables drugs companies to recoup the money that they have invested in developing, testing and bringing a product to market and, hopefully, to allow them to make a profit from it over the period of the patent. Without this kind of regulatory protection, pharmaceutical companies would not be able to spend the vast sums of money to develop the huge arsenal of drugs that are available to us. True that some cynical types believe that this monopoly can be a detrimental thing and that pharmaceutical companies are mercenary to charge such, often, extortionate prices for simple drugs.

The fact remains that, according to the Tufts Center for the Study of Drug Development in a research paper published in the Journal of Health and Economics, the average cost of developing a new pharmaceutical medicine is $2.6 billion!

In 2013, Pfizer’s patent on the drug expired in Europe and, as a result, patients were able to access generic variations of sildenafil for the first time. In 2014, the UK’s health service, the NHS began prescribing alternatives to Viagra. And, in 2018, the UK’s Medicines and Healthcare Regulatory Agency (MHRA) went one step further, reclassifying sildenafil (that means Viagra and all alternatives – see below) as a pharmacy drug. That means, in the UK at least, you don’t need to have a doctor’s prescription to get access anymore.

The protection afforded Pfizer in the United States under patent was due to expire in March 2012 and plenty of manufacturers were poised to hit the market with a generic equivalent to Viagra; notably Teva Pharmaceuticals who had already managed to secure tentative approval from the FDA.

However, Pfizer lodged a successful extension to their exclusive supply license for a further eight years.  They managed to do this by reporting some new developments for the drug’s application. This means that sildenafil, or Viagra, is still only available in the U.S. to treat ED if it has been produced by Pfizer.

However, this monopoly is due to end in April 2020 when the extension period for the patent expires.

It should also be noted that, in order to secure the extension to the original patent, Pfizer settled out of court with the manufacturers, Teva Pharmaceutical who are entitled to produce a generic version of Viagra in the U.S. under a profit-sharing deal.  This profiteering deal came to an end for Pfizer on 11th December 2017. In order to counteract any drop in profits associated with this, Pfizer also released its own generic version of the drug around the same time.

So, outside of the United States you can get access to many generic versions of Viagra and, in the U.S., you can find two variants on sale. But, from April 2020, the market will be opened yet further with licenses already approved by the FDA for the following companies:

  • Ajanta Pharma Ltd
  • Amneal Pharms NY
  • Aurobindo Pharma Ltd
  • Hetero Labs Ltd V
  • Lupin Ltd
  • Mylan Pharms Inc
  • Rubicon
  • Teva
  • Torrent

The increased competition will no doubt further reduce the cost of Viagra and its generic alternatives in the United States just as it has done in other countries (see below). However, there are yet more reasons why the price of Viagra is facing stiff competition, including some different treatments for ED.

Alternatives to Viagra

There are three main pharmaceutical drugs that have been used to treat erectile dysfunction which provide similar results to Viagra.

  • Vardenafil – also known by its brand names Staxyn, Levitra and Staxyn. The license for this drug expired in October 2018 and generic forms are now available.
  • Tadalafil – also known by its brand names Adcirca and Cialis. The license for this drug expired in the UK in 2017 where generic versions are now available and the patent will end in 2019 for the U.S.
  • Avanafil – also known as Stendra and Spedra. The FDA license for this drug will expire in 2023 in the U.S. but generic versions are already available in other countries including the U.K.

All three drugs have been shown to be pretty effective at treating ED and are widely used by men seeking a performance enhancing drug for some extra ‘revs’ for their bedroom engines.

In fact, some have been shown to be even more effective at treating ED than Viagra which has also helped eat into Pfizer’s profits.

In a recent article published in The Pharmaceutical Journal, the four main ED treatments were compared:

  Sildenafil Tadalafil Vardenafil Avanafil
Efficacy 69% 75% 71-80% 47-59%
Time to Peak Plasma Levels 60 minutes 120 minutes 45-90 minutes 30-45 minutes
Time to Action 25 minutes 15-30 minutes 25 minutes 15-30 minutes
Duration of Action 4 hours Up to 36 hours Up to 12 hours Up to 6 hours

Each of the drugs has its own set of associated common side effects which range from headaches, dizziness and nausea to dyspepsia, myalgia and visual abnormalities. There are also known interactions between them and other prescription medicines.

For obvious reasons, it is strongly recommended that you seek proper medical advice before self-administering any form of ED treatment (even if you are using it for its performance enhancing properties).

Lastly, the rise of counterfeit versions of Viagra has also been on the rise which has further reduced the price of generic alternatives. These tablets are known to include some particularly harmful substances including amphetamines, boric acid, metronidazole and even blue printer ink to achieve that hallmark hue.

Price Check: Viagra vs The Rest of the Market

Even with the loss of revenue from the expiry of the patent in Europe, Pfizer has no doubt made an absolute killing from its discovery of sildenafil.

By 2008, just ten years after the launch of the drug, Viagra had been prescribed to more than 37 million men worldwide. Give it another eight years and this figure almost doubles to 64 million by 2016 and, following the loss of the patent, by 2016 it is estimated that more than 5.4 billion Viagra tablets have been dispensed.

However, there is also little doubt that the European patent expiry has had a sizable impact on the company’s revenue and with a similar drop in turnover expected when the US patent expires, Pfizer have every reason to be twitchy.

In the UK, we can see a clear illustration of the fall in price of Viagra when the company’s patent expired. This graph shows the net cost to the NHS for subscriptions of sildenafil (and other ED treatments) for the period 1999-2016.

uk viagra prices nhs

The cost of ED treatments in the UK’s NHS has fallen substantially following the expiry of Pfizer’s patent on sildenafil. Image via Pharmaceutical Journal.

The cost of sildenafil, depicted in blue quite sharply falls from  £40.2 million in 2012–2013 to £5.8 million in 2015-2016. This is a direct result of the cost of prescription items reducing from £31.22 to £2.20.

The Take Home

Outside of the U.S. the revenue generated by sales of Viagra for Pfizer have slowly been falling since the various patents have expired in different regions.

Figures published by Statista for the period 2003 to 2018 show a marked decline from 2012 for Pfizer’s Worldwide Revenue from Viagra (million USD).

revenue generated from viagra pfizer

Global competition and domestic generic alternatives launched in 2018 have all combined to pinch Pfizer’s revenue. Image via Statista.

As you can see, revenue for 2018 was just $636 million vs peaks of over $2 billion in 2012…just before the patents started to expire.

With nearly half of all Pfizer’s revenue generated inside the United States, the expiry of the patent on one of their best-selling drugs will no doubt hit the company hard. Investors in the company however are not perturbed and shares in Pfizer have risen since 2012 (when the international patents expired) to a high of $46.47 which is near to the highest rate seen on the stock exchange since the company started trading!

Certainly, the future for Pfizer no longer rests on the ability of Viagra to maintain their cash-flow erection and the company is looking to new product developments as well as continuing to market both the original, plus generic alternative of, Viagra. However, the only way that they can continue to compete with other manufacturers of sildenafil is by reducing the cost.

So, whilst we can’t tell you what Pfizer’s share prices will do over the next 12 months, we do know that the cost of legitimate Viagra, manufactured by Pfizer, looks set to fall. And, if you can’t wait that long there are already ways to get your hands on generic alternatives or even a totally different ED product at competitive prices.

The bottom line is that, as the market for ED treatments comes of age in its 21st year, prices may have gone a bit soft, but it’s comforting to know however that the results they produce are still rock solid.

Happy birthday, Viagra.

Featured image via Pixabay (PublicDomainPictures).

Staff Writer

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