The Big Drugs for 2006

The 2006 list includes five holdovers from last year, including Exubera and Indiplon. Another repeater is Tysabri, the multiple sclerosis drug that's trying to make a comeback.

Developed by Elan (ELN Quote) and Biogen Idec (BIIB Quote), Tysabri was withdrawn in February 2005 after having been available for only a few months. The companies pulled the drug after receiving two reports of a rare, often fatal, brain disease. A third case was later identified.

Last week, the companies received FDA clearance to resume a clinical trial of Tysabri with MS patients. An FDA advisory committee meets next month to consider whether they think the drug can return to the market.

Tysabri is "critical to Elan's efforts to stem cash outflows and become profitable again," says S&P. "The company has no other high-potential prospects in its pipeline. Tysabri is nowhere near as critical for Biogen."

S&P predicts Tysabri will be approved by the FDA, adding that "the drug's blockbuster potential still exists." Still, it will take some time for doctors and patients to "get comfortable with the safety concerns before sales accelerate."

Another holdover candidate on S&P's list is Orencia, a rheumatoid arthritis drug from Bristol-Myers Squibb (BMY Quote) that was recently approved by the FDA.

S&P says Orencia is important not only because it's entering a fast-growing market, but also because it must take up the sales burden of Pargluva, an experimental diabetes drug whose prospects have diminished significantly. The company reported in October that it may have to conduct more clinical trials -- taking perhaps five years -- to meet conditions set by the FDA for approval. The company said it might have to scrap the drug.

The FDA's action prompted Moody's Investors Service to consider reducing the credit rating of Bristol-Myers Squibb. The bond-rating firm said Wednesday it would keep the long-term rating, affecting $6 billion in debt, at A-1, an "upper medium grade" designation. The outlook remains negative.