Safety questions about popular pain-killing medications may give Americans pause over the nation's pill-popping culture, analysts say, and that would give the beleaguered drug industry something else to worry about.
The tendency to take prescription pills for everyday aches and pains, shyness, allergies, impotence, and other "lifestyle" concerns have helped prop up pharmaceutical company revenues. Now analysts say safety concerns may prompt a consumer backlash.
"We are entering a period of caution and concern, and a lot of people will take a second look at the excessive use of so-called lifestyle medicines," said Steven Findlay, a health care analyst at Consumers Union in Washington.
In September, Merck & Co. pulled its blockbuster painkiller Vioxx off the market after studies found it increased the risk of heart attacks and strokes. Last week, Pfizer Inc. said high doses of its painkiller Celebrex more than doubled the risk of heart attacks. And this week, federal health officials said naproxen, sold over the counter as Aleve, might increase the risk of heart attack or stroke.
Questions also have been raised about whether some antidepressants pose an increased risk of suicide among children and teenagers.
"When the average consumer sees the headlines and the news blitz on one drug after another, you would think that the average person is going to become more and more concerned," said Herman Saftlas, a pharmaceutical analyst for Standard & Poor's.
Mounting pressure
Members of Congress have expressed concern over the safety problems, and pressure is mounting on the Food and Drug Administration to strengthen its safety examination of drugs. Analysts predicted that will lead to lengthier, more expensive testing of new drugs.
Add to that the pharmaceutical companies' other problems — including a dwindling pipeline of new drugs in development and a number of older drugs losing patent protection — and the industry's growth prospects appear dim, analysts said.
"I think it's a tough outlook for them going forward," said David Moskowitz, managing director of health care research at Friedman, Billings, Ramsey Group Inc.
Gone are the days of 13 and 14 percent annual revenue growth that drug companies enjoyed in the 1990s. Revenue growth has fallen to 9 or 10 percent in recent years and is likely to fall further, to 7 or 8 percent annually, according to Saftlas of Standard & Poor's.
"The growth engines have all slowed," Saftlas said.
Instead of investing heavily in "me too" drugs that barely differ from existing products and marketing them with expensive TV commercials, Moskowitz said drug companies will be under pressure to develop drugs for unmet medical needs.
However, that approach won't mean big profits, Moskowitz said, unless the companies develop a variety of successful new medicines, not just one or two. Still, there may be some bright spots for the drug companies.
'Americans understand taking pills'
Findlay thinks consumer caution over lifestyle drugs will subside after a time. "Americans understand taking pills," he said. "It's simple. It's an easy thing to do. And many pills over the years have been very effective. We've come to rely on many of our medicines because we are less willing to change our lifestyles in ways that would lower our risks to some diseases."
Jerome L. Avorn, a Harvard Medical School professor and author of a book called "Powerful Medicines: The Benefits, Risks, and Costs of Prescription Drugs," questioned whether there would really be changes in the way that drug companies and the FDA do business.
For the pharmaceutical industry, Avorn said, "It may be a case of waiting things out and hoping there will be other crises and hoping that the public's attention span is short."
Yesterday, Pfizer shares were buoyed by a twist in the federal study that showed cardiac problems with naproxen: It didn't show the same problems with Celebrex. Pfizer shares closed at $24.97, up 68 cents. Merck shares were up 47 cents at $31.98.
But both companies are down significantly from their 52-week highs — $49.33 for Merck and $38.89 for Pfizer — and Saftlas said bargain hunters may be buying up shares.
"I don't see a sustained rally occurring" for drug company shares, Saftlas said. "I don't see the catalyst to support that rally."