Competition for Viagra

Nov 01, 2002

Bayer and GlaxoSmithKline are preparing to launch the erectile dysfunction therapy Levitra (vardenafil) next year, in an effort to steal US market share from Pfizer's dominant ED brand Viagra (sildenafil), one of the most successful prescription drug launches in US history.

The move comes at a time when mainstream awareness of ED is at its highest, but the market for such products is still largely untapped. Annual sales of Viagra are about $1.5 billion. Nevertheless, according to Nancy Bryan, vice-president of men's health marketing for Bayer, only about 13 percent, or 3.9 million, of the estimated 30 million US men who suffer from the disorder have been treated. That leaves 87 percent of the market, or 26.1 million men, open to new prescriptions, which Bryan says presents attractive marketing possibilities.

There will be even more competition for those patients in 2003. Lilly and Icos are also prepping to introduce another ED treatment in the United States called Cialis (tadalafil). The three drugs differ in effectiveness and duration, but the reported side effects are similar.

With increased competition, marketing budgets are also expected to rise.

"We're prepared to spend the resources to successfully compete for market share in this area," Bryan says, declining to elaborate on how much Bayer and GSK will spend on marketing.

Although the specific amount remains a secret, Bayer and GSK are expected to spend well into the hundreds of millions dollars. In 2000 alone, three years after the product's launch, Pfizer spent nearly $109 million in direct-to-consumer marketing campaigns for Viagra (See PE, "Flexing Their Budgets," September 2001). Since then, the company has spent a comparable amount each year on such things as sponsoring driver Mark Martin's NASCAR racing car and being an official sponsor of major league baseball. GSK spent more than $310 million combined on physician detailing and DTC campaigns for its antidepressant Paxil (paroxetine) in 2000, and Bryan says the experience of that successful launch and subsequent promotions will help with Levitra. "It's been important for us to understand what other products have done in different areas," she says, adding that the companies have been working on marketing strategies for two years.

Although Viagra has nearly become a cultural phenomenon, it has still been unable to erase men's apprehension in approaching a doctor about taking the drug. But with two more ED products coming into the market, the category should benefit from increased exposure.