Ahead of the Bell: Merck

Merck reported results of the 24-week trial Sunday at a European cardiology conference. The Whitehouse Station, N.J., company said patients received doses of either Cordaptive, niacin, or a placebo for the first four weeks of the trial. After four weeks, the doses of patients given Cordaptive and niacin were doubled, and kept at that level for the next 20 weeks.

Niacin is also used as a cholesterol treatment.

Tests showed the patients who received Cordaptive had a 19-percent drop in their levels of LDL-C, or "bad" cholesterol," and a 19-percent increase in their levels of HDL-C, or "good" cholesterol.

By the end of the study, the patients taking Cordaptive were suffering less of a side effect called "flushing," which causes skin reddening and a burning sensation, than the patients taking niacin alone.

Side effects of Cordaptive included greater enzyme levels in the liver and higher "fasting" levels of glucose. The drug also increased levels of creatine kinase, an enzyme that is released when muscles are exerted. Merck said those levels returned to normal after the study ended.

Cowen & Co. analyst Steve Scala said he expected the drug to be approved, but said Cordaptive may not be as safe as extended-release niacin.

"Despite Cordaptive's safety being similar to extended-release niacin, raised liver functions, increased creatine kinase levels and diabetic parameters all trended less favorably versus extended-release niacin," he said.

Scala estimates $150 million in sales of Cordaptive-related drugs in 2008, with revenue growing to $700 million in 2012.

Morgan Stanley analyst Jami Rubin said sales could top $700 million by 2011, but noted that Abbott Labs is developing a concentrated version of its niacin drug, which could affect Cordaptive sales.