By Jon Plant, DVM, DACVD
There is a huge demand for Apoquel®, the new Zoetis (NYSE: ZTS) drug for dogs with atopic dermatitis or “allergic” dermatitis. I predict that Apoquel sales will exceed $1 billion per year for Zoetis after the supply issues are resolved. It has dramatically improved the quality of life of most of the dogs that I have been able to treat thus far. The dogs are happy, the pet parents are grateful, and I feel like a hero.
BUT, I am in the fortunate minority of veterinarians that has a reasonable supply, thanks to placing a large order early on, and the Zoetis policy of directing the available supply of Apoquel to the dogs which are already taking it. Many veterinarians are understandably upset that a) they can’t order Apoquel after having talked it up to their clients before the launch, and b) communication from Zoetis was a little herky-jerky for a few months regarding the supply issues that were emerging.
Some veterinarians are voicing conspiracy theories – Zoetis is trying to gin up the demand in order to raise the price, or there is some problem with the manufacturing process that they are hiding. I’ve even read speculation that the shortage is due to a conspiracy by veterinary dermatologists to buy it all up because it could be seen as a threat to referrals!
I don’t buy any of those theories. I suspect the real story goes like this:
- Zoetis managers remembered the disappointing launches of some other companion animal drugs.
- A very well-managed marketing strategy was executed, complete with flashy video animations, numerous research presentations, and webcasts for veterinarians at dinner meetings throughout the US.
- The price was set reasonably, within the reach of many pet owners. This invalidated comparisons to the Atopica® launch, if they were using that to forecast.
- Someone made a decision not to invest in the facilities that would have allowed for a higher level of Apoquel production, should the need arise.
- A cumbersome manufacturing and packaging process was chosen which involves shuffling the active ingredient, tablets, and packaged product between countries. Is this really efficient and cost effective, or is it to avoid taxes? I don’t know.
- Within a few weeks of the launch, it became clear that the amount of Apoquel available would not meet the demand.
- The decision was made to allocate the available Apoquel supply such that dogs that had already started it would have priority.
- No veterinarians are able to buy as much Apoquel as they want – some are just able to buy more than others in order to keep some of their current patients on it.
No conspiracy. Someone at Zoetis just didn’t quite believe their own data on the potential size of the market and Apoquel’s effectiveness. In a few years, this shortage will be behind us and many dogs will benefit. That is little consolation for pet owners who are seeking Apoquel now for their itchy dogs.