ANALYSIS-AstraZeneca faces testing year in cholesterol wars

For those taking Crestor as their maintenance medicine, take a look at this article:


ASTRAZENECA/CRESTOR (ANALYSIS)
* Pfizer's Lipitor patent loss spells new era of competition

* Astra hopes new guidelines, key trial will help fight-back

* Uncertainty over Brilinta adds to pressure on Crestor

* Crestor sales critical as other AstraZeneca drugs decline

By Ben Hirschler

LONDON, Jan 21 (Reuters) - The patent expires later this year on the world's biggest selling drug, Lipitor, and it is causing a headache not just for maker Pfizer but also for arch-rival AstraZeneca.

Billions of dollars in sales of AstraZeneca's Crestor, a competing cholesterol medicine, could be at risk from Lipitor's demise.

Cheap copies of Lipitor, a $12 billion-a-year seller, are expected to hit the key U.S. market at the end of November and this year or next in Europe. So competition in an already tough market is about to ramp up massively.

AstraZeneca has a couple of rolls of the dice to make Crestor stand out from the crowd. But there is little room for error and any slip could increase pressure on the group to buy future sales growth through acquisitions, according to analysts.

With patents on other drugs expiring and the group facing setbacks with a number of new products, including delayed U.S. approval of key heart drug Brilinta, AstraZeneca needs Crestor to keep growing strongly if it is to achieve its goal of $28-34 billion in annual group sales between 2010 and 2014.

The group is awaiting the next move from U.S. regulators over Brilinta..

For now, all eyes will be on any revisions to the overall sales target with full-year results on Jan. 27, as well as signs that share buybacks will continue to flow in 2011, helped by the expected divestment of devices and dental implants unit Astra Tech.

$5 BILLION OR $9 BILLION?

For the moment, consensus forecasts from analysts suggest AstraZeneca will generate sales of $7.4 billion from the medicine in 2014, up from an expected $5.6 billion last year.

But there is a big gulf between bulls and bears, with forecasts ranging from a high of nearly $9 billion to a low of just under $5 billion, according to Thomson Reuters estimates.

"There are two significant risks to Crestor this year. The first is that we will probably have the appeal hearing on the Crestor patent decision, which I think everyone has forgotten about, and we will also have the results of the head-to-head study against Lipitor," said Jefferies analyst Jeff Holford.

AstraZeneca dodged a bullet last year when the U.S. patent on Crestor was upheld, ensuring exclusivity to 2016, but an appeal is likely to take place in the second half of 2011.

The company's head-to-head clinical study, which is expected to yield results just before Lipitor loses its U.S. patent, is a clear gamble for AstraZeneca -- but one it thinks it can win.

Past studies suggest high doses of Crestor are slightly better than high doses of Lipitor at reducing "bad" LDL cholesterol and far better at raising "good" HDL. Yet whether that translates into fewer clogged arteries remains to be seen.

Tim Anderson of Sanford Bernstein puts the odds in favour of a positive result for Crestor at 65 percent -- which would put blue sky between it and Lipitor -- but he thinks the downside risk outweighs the upside given already high expectations.

A negative result could hit Crestor in the same way that another negative trial undermined Merck & Co's cholesterol drug Vytorin, he said in a recent research note.

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