has changed its marketing strategy again as it tries to stimulate sales for BiDil, the congestive heart failure medication for African-Americans.
NitroMed, of Lexington, Mass., said Wednesday that it will fire its 120-member salesforce and replace it with a small group of marketing specialists to target experts in heart disease. BiDil reached the market in July 2005
and is the first medication approved for a specific ethnic group.
The decision represents an about-face by NitroMed, which originally hired 190 marketers on a contract basis to sell the heart drug to a wide range of physicians.
When that strategy proved expensive and ineffective, NitroMed hired an in-house salesforce.
Now this tactic has failed, too, prompting investors to knock down NitroMed's stock by 20 cents, or 7.9%, to $2.33. The stock fell as far as $2.16, a 52-week low. NitroMed's stock has lost about 90% of its value since January 2005.
"Sales of BiDil have grown steadily, but they are not growing at a rate that supports the present sales structure," said Jerry Karabelas, chairman and CEO of NitroMed.
The drug has been hampered not only by past salesforce problems but also by the reluctance of health maintenance organizations and insurers to cover it at favorable rates. NitroMed initially had trouble convincing insurers to reduce the out-of-pocket expenses paid by consumers.
"While we are now operating in a more favorable reimbursement environment for BiDil, we are seeking to position the company to optimize resources within our present financial constraints," Karabelas said.
The firing of the salesforce will save $30 million a year in operating expenses and allow the company to devote more resources to BiDil XR, a once-a-month version of the pill. The current formulation has to be taken three times a day.
NitroMed said preclinical trial results have been positive, adding that human studies will begin in a month. The company will record salesforce-restructuring charges in the fourth quarter.
The new marketing team is still being hired. The company is also talking to potential marketing partners.