INDIANAPOLIS — Eli Lilly & Co. said Thursday that it is abandoning the development of an enhanced form of the antidepressant drug Prozac after a new evaluation of clinical data.
Lilly said it is returning the marketing rights for an enhanced Prozac molecule to Sepracor Inc. Shares in Sepracor lost nearly a third of their value on the news, while Lilly was off slightly.
Lilly also reported a 15% rise in profit for the third quarter to $778.8 million, or 71 cents a share, in line with analyst expectations, as revenue grew 9% to $2.812 billion.
Nearly two years ago, Lilly paid $90 million for the right to sell the new and improved version of the drug on the promise it would eliminate some side effects, including sexual dysfunction.
Lilly said it made its decision after examining data on the new molecule, called R-fluoxetine.
Sepracor said separately that data indicated a lower dosage was necessary, delaying a new drug application to the Food and Drug Administration by at least two years. Sepracor also said it will not develop the molecule any further.
Shares in Marlboro, Mass.-based Sepracor plunged $33.75, or 28%, to close at $87.06. Lilly closed off 75 cents at $88.50 on the New York Stock Exchange.
Lilly's strategy was to bring R-fluoxetine to the market before the last of its patents on Prozac expired in 2003. But a recent federal appeals court ruling threw out one of the patents, opening the door for the first generic versions to reach the U.S. market as soon as August. Competition from generics in foreign markets and from other antidepressants in the U.S. already is cutting into Prozac sales, which were down 3% worldwide during the first nine months of this year to $1.9 billion.
Dr. Gary Tollefson, president of Lilly's neuroscience product group, said the company will concentrate on developing different drugs to treat depression.
Lilly plans to submit a new drug application for a chemical called duloxetine in about a year, Tollefson said. It also is developing a combination of the active ingredients in Prozac and its psychosis drug Zyprexa for hard-to-treat depressed patients.