In a historic judgement, GlaxoSmithKline has won the patent for cervical-cancer vaccines against its rival Merck. The patent agreement, which had been expected, clears the way for both companies to introduce their potential multibillion-dollar products over the next couple of years.
The analysts believe the rival vaccines against the human papillomavirus which causes most cases of cervical cancer, could each become 1-billion-pound-a-year sellers. Merck is currently ahead in the race and plans to file its vaccine for regulatory approval with the U.S. Food and Drug Administration in the second half of 2005. GSK first revealed in December that it was discussing sharing patents with Merck.
"We would assume they (GSK) will receive royalties of between 5-7 percent on global sales," ABN AMRO analyst Adrian Howd said in a note on Thursday. Both the companies will enjoy the profit as there is plenty of room in the market.
The British-based company expects to file its product in Europe in 2006 and analysts expect a U.S. regulatory submission late next year or in early 2007. According to GSK Chief Executive Jean-Pierre Garnier, there are more than 400 million women in Europe and the United States aged between 15 and 55 who could be vaccinated. This would definitely generate handsome revenues for both the companies.
Some religious groups have questioned the concept of vaccinating teenage girls against a sexually transmitted infection. Besides the products face significant marketing challenges before becoming blockbusters, since it is not yet clear whether public health officials in major markets will accept the arguments in favour of mass vaccination.
