The company declined to discuss details in the so-called  not approvable letter from the Food and Drug Administration. It  would not comment on whether the agency had asked for further  data or new clinical trials. The drug, which was expected to be called Cordaptive,  combines long-acting niacin with a new drug that prevents the  flushing side effect common to niacin — an uncomfortable  sensation of burning in the face and neck that leads many  patients to discontinue taking it. Analysts widely expected the drug to be approved,  especially after a committee of European regulators last week  recommended it be cleared for sale there. The rejection was another blow for Merck, whose share price  has fallen about 30 percent this year amid a controversy and  debate over the effectiveness of the cholesterol drugs its  sells in a joint venture with Schering-Plough Corp. The FDA decision should be a boon to Abbott Laboratories,  whose franchise of niacin-based cholesterol drugs would have  been in direct competition with Merck’s proposed new entry into  the lucrative market. Abbott shares rose 2.7 percent following the Merck news. Deutsche Bank analyst Barbara Ryan called the news a  disappointment. “We expected the drug to get approved,” she said. “It’s not  going to have any impact on the earnings outlook for this year,  but certainly as we go out in time they could have had an  important contribution from the drug.”    Merck said it would meet with the FDA to submit additional  information to enable the agency to further evaluate the  benefit/risk profile of the drug, which it has gone back to  calling MK-0524A after the FDA also rejected the prospective  brand name Cordaptive. “We firmly believe that MK-0524A provides physicians with  an important option to manage their patients’ cholesterol,”  Merck’s research chief Peter Kim said in a statement. The company said it did not yet know when a meeting with  FDA officials might take place. In clinical trials, the laropiprant component of the drug  demonstrated an ability to significantly reduce the flushing  effect of niacin. It had been hoped the combination would  enable patients to tolerate niacin at a dose that provides the  most therapeutic benefit. Despite the setback, Merck reaffirmed the 2008 forecast it  issued last week and reiterated confidence in meeting its goal  of double-digit annual earnings per share growth through 2010,  excluding certain items. Some analysts believed that Cordaptive and a planned  follow-up combination drug that also includes Merck’s bad  cholesterol lowering Zocor could eventually garner $1 billion  to $2 billion in annual sales. Merck shares fell to $39.40 in extended trading from their  New York Stock Exchange close at $41.44, while Abbott shares  climbed to $53 from the NYSE close at $51.61.
Merck says FDA rejects its new cholesterol drug.