The drugmaker Pfizer Inc. said Monday that it would begin selling its erectile dysfunction drug Viagra online in hopes of thwarting counterfeit Web-only pharmacies, holding off legitimate competitors, and boosting profits.
The pharmaceutical industry will watch this closely because it could change how drugs are bought, paid for, and delivered through the many layers of the current and complicated system.
Pfizer will market the drug through viagra.com, but CVS Caremark will handle the online processing and shipping. Patients will still have to get a doctor's prescription, and the website walks patients through insurance and billing information requirements.
Insurance companies often put "lifestyle" drugs, such as those for erectile dysfunction, on higher cost tiers. But Pfizer is using discounts, coupon cards, and, in some cases, free pills.
Getting prescriptions through the mail is not new - much to the chagrin of retail pharmacists, especially those running independent operations.
But Pfizer's move is another step beyond direct-to-consumer pharmaceutical advertising, which exists in the United States but few other industrialized countries.
"What's novel is the manufacturer getting more directly involved, via CVS, and marketing directly to the patient," said Adam J. Fein, president of Pembroke Consulting Inc., a pharmaceutical management advisory and business research firm based in Philadelphia.
CVS is mainly known to consumers as a drugstore chain, but the company has become a huge player behind the scenes as a pharmacy benefit manager and mail-order drug distributor. A pharmacy benefits manager is usually hired by a company to manage the drug portion of an employer-sponsored health-care plan.
Wholesale drug companies such as Valley Forge-based AmerisourceBergen, McKesson, and Cardinal Health are another layer in the current supply chain.
Fein said insurers might be the most worried by Pfizer's tactic. If Pfizer's engagement and discounts reduce a patient's out-of-pocket costs, it might prompt him to stay with Viagra and not switch to a lower-priced ED drug, which would hurt the insurer's bottom line.
Viagra had $2.1 billion in sales in 2012, mostly in the United States, where each pill can cost $25. Pfizer's U.S. patent runs through 2020, so there are no official generics, but there are competitors in the category, such as Cialis by Eli Lilly & Co.
Aside from Pfizer's profit concerns, the health concern is that counterfeit drugs could have dangerous and unknown ingredients or the improper amount of the active ingredient. Viagra has its own set of side effects, but they are listed in the official label.
"There are almost 24 million searches a year for Viagra online," Victor Clavelli, a Pfizer senior director, said in a statement. "By offering men with ED convenient access and a legitimate alternative to purchase Viagra online, our hope is that Pfizer will help rein in the distribution of fake ED products."