Pfizer Inc. (NYSE:PFE)‘s Viagra (sildenafil citrate), the little blue pill with the big marketing campaign, was first cleared for sale by the FDA on March 27, 1998, becoming the first drug cleared to treat erectile dysfunction in the United States. Originally developed in 1989 at a Pfizer research facility in historic Sandwich, England to treat hypertension and angina pectoris, the drug soon became man’s second-favorite invention to come out of the town of Sandwich when early clinical trials found that it was a lot better at creating erections than curing angina.
Pfizer Inc. (NYSE:PFE) took the opportunity to penetrate a virtually untapped market. Sildenafil gained a patent in 1996 as it moved through the latter stages of its erectile-dysfunction clinical trials. The drug became a raging success right out of the gate, thrust into the spotlight by one of the first major publicity campaigns ever mounted for a prescription drug. With public figures such as Bob Dole (fresh off his failed 1996 presidential candidacy — you know that if Bill Clinton had lost, he would have been the political pitchman instead) and sports stars like Pele and Rafael Palmeiro promoting it, Viagra became one of Pfizer Inc. (NYSE:PFE)’s biggest and most durable successes.
In its first year alone, Viagra brought Pfizer Inc. (NYSE:PFE) a billion dollars in sales. The drug’s smashing success caused several well-endowed competitors to spring up, including Bayer and GlaxoSmithKline plc (ADR) (NYSE:GSK)‘s Levitra and Eli Lilly & Co. (NYSE:LLY)’s Cialis. A decade after its introduction, Viagra was producing monster results for Pfizer Inc. (NYSE:PFE), accounting for $1.9 billion in annual sales in 2009. Shortly afterward, the global market for erectile dysfunction surpassed $5 billion in cumulative revenue. It was six years after Viagra’s FDA approval that the Dow Jones Industrial Average (Dow Jones Indices:.DJI) added Pfizer to its ranks, an acknowledgment of the drugmaker’s impressive quadrupling of revenue over that short time frame.
Viagra couldn’t maintain its position as the market leader forever: Cialis passed the ED pioneer about 12 years after its FDA approval. However, its influence on the drug industry has been more important than its impact on Pfizer Inc. (NYSE:PFE)’s bottom line. Sales and marketing have become a much larger part of pharmaceutical companies’ strategies, and roughly 30% of the industry’s expenses are sales- and marketing-related. In some cases, drugmakers spend more on marketing than on research and development! Viagra isn’t set to lose its patent protection until 2019, but with 20 million American men already familiar with it, the drug is likely to remain a blockbuster for years to come.
