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CUSTOM SYNTHESIS
Moody's Investor Service said last week it is considering downgrading the debt rating of Avecia after the company told analysts that its 2003 sales would be hit by the delayed U.S. launch of AstraZeneca's anticholesterol drug, Crestor. Intermediates for the drug currently make up 15% of Avecia's fine chemicals sales. The impact of delayed FDA approval for Crestor, a statin drug that would compete with Pfizer's Lipitor in an $18 billion world market for anticholesterol drugs, highlights a dilemma facing fine chemicals companies that supply major drugmakers. The dwindling number of blockbusters in drug company pipelines, combined with increased FDA scrutiny, has put primary sources of revenue at increased risk. "Needless to say, this will impact us heavily in 2003," an Avecia representative says. FDA asked AstraZeneca to submit further details on Crestor (rosuvastatin) earlier this year after Bayer removed Baycol (cerivastatin) from the market as a result of concerns that a muscle deterioration side effect typical of all statins may have resulted in 40 deaths around the world. AstraZeneca says it expects FDA approval by the end of 2003, a year later than originally anticipated. Crestor took a step toward launching in Europe last week, however, with approval from the Medicines Evaluation Board in the Netherlands. AstraZeneca expects 15 other European Union countries and Switzerland to follow over the next 90 days. Analysts say Avecia is only one of several custom manufacturers affected by drug approval delays this year. "Customers in the pharmaceutical and custom synthesis sectors are increasingly dependent on a handful of products, and when drugs like Crestor and Bristol-Myers Squibb's Vanlev fail to materialize, it leaves suppliers on the beach," says Arthur D. Little analyst Enrico Polastro. Avecia, like other contract manufacturers, says it has been attempting to cushion the impact of delayed drug approvals by investing in services for early-stage drug development. |
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