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In Pursuit of Primary Care, Schering-Plough Is Growing against the Grain

The marketing deal between Schering-Plough and Bayer gives Schering additional products it can sell along with its recently approved cholesterol drug Vytorin, and a significant number of reps to help it do so. As such, the deal reinforces Schering's commitment to building a primary care franchise. But it also runs counter to an emerging trend among many Big Pharmas to focus increasingly on higher-value specialist markets, which do not require a huge sales and marketing infrastructure--or the regular flow of new primary-care products necessary to support it.

The new marketing arrangement between Schering-Plough Corp. and Bayer AG [See Deal] gives Schering additional products it can sell along with its recently approved Vytorin (the cholesterol drug that combines Schering's ezetimibe (Zetia) and Merck & Co. Inc. 's simvastatin [Zocor]). It also adds a significant number of reps from Bayer to help it do so. The deal reinforces Schering's commitment to building a primary care franchise, a cornerstone of CEO Fred Hassan's turnaround plan for the company. But it runs counter to an emerging trend among many Big Pharmas to focus increasingly on higher-value specialist markets, which do not require a huge sales and marketing infrastructure—or the regular flow of new primary-care products necessary to support them.

With Vytorin (co-developed with Merck [See Deal] and approved in the US three months ago) and Zetia, which has been on the market for two years in the US and gained full EU approval in 2003, Schering-Plough believes it has an engine to fuel earnings growth

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