Pliva/Indevus: Moving Up the Value Chain

Pliva's not the obvious choice of US marketing partner for Indevus' overactive bladder drug Sanctura. With no primary care presence in the US, the company will likely face an uphill battle to commercialize the drug; more so given the stiff competition in OAB from some of the world's leading Big Pharma marketeers. Yet the deal's about more than success with Sanctura. It's about both parties moving up the value chain--Pliva into the US proprietary drugs arena and Indevus into sales and marketing.

Indevus Pharmaceuticals Inc. 's recent announcement of a US marketing partner for the overactive bladder drug trospium (Sanctura) surprised many biotechnology commentators. [See Deal] They were all expecting a deal, but certainly not the partner. Half of all OAB scrips are generated by primary care physicians, yet Indevus opted for Pliva DD , a company with no primary care experience and which only expanded into the US market in 2002. The most obvious reason: Pliva—but not Big Pharma—was apparently willing to pay the level of up-front, milestone and commercial fees that Indevus wanted. But the question remains: can Pliva maximize the value of Sanctura in the primary care arena where it has neither an existing presence nor any experience?

Croatian firm Pliva has historically focused both on the generics market and on Eastern Europe. In recent years however, the...

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