Regulatory Change Could Mean Millions to Big Pharma

Implications: A proposed regulatory change proposed on the Friday before a holiday weekend could have a major impact on pharmaceutical profits (and consumer health).

Analysis: The FDA is considering whether to allow greater leeway in allowing pharmaceuticals to promote off-label uses of drugs. While this rule would not allow pharmaceutical companies to advertise off-label use, it would permit them to share journal articles about non-approved uses with physicians.

No doubt, there are pros (better informed physicians) and cons (disincentive for investment in studies necessary to gain a new indication) to such a rule change. But one thing is for sure; if pharmaceuticals are allowed to disseminate (truthful) information (in the form of published studies) regarding off-label use, it will translate into significant new profits for drug companies. The only question is, how much.

Makers of drugs who's promise has not been fully explored, stand most to gain. Drugs such as statins, SERMS (Raloxifene and Tamoxifen) stand to see increases in prescriptions as doctors (particularly generalists) are likely to become more familiar with the benefits of off-label use, courtesy of the manufacturers.  As such, look for Pfizer, Lilly and Astra Zenica to be benefit significantly.