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Lilly Learns a Lesson on Cialis: Price Hikes Work

One of the more interesting parts of Eli Lilly (LLY)'s Q4 2009 earnings report was the section on Cialis, the company's ED drug. The company has doubled the wholesale price of Cialis since its launch (chart below) but that has done little to stem demand. The company saw a 19 percent increase in dollar sales from the drug, to $439.5 million.

You may have noticed that the company is also running a new set of TV ads for the product (they're a little more modern looking but they still end with the bizarre couple in separate bathtubs looking out over the countryside.)

Clearly, Lilly believes this drug has plenty of stamina left. Break down the numbers a little more and you find that American men are actually the weak part of the Cialis market. Sales in the U.S. rose 12 percent to $166.2 million; but sales to foreigners rose 24 percent, to $273.4 million.

Annual sales were up to, with the dollar increase in foreign territories bigger than the dollar increase in the U.S.

What this means is, expect to see more of the bathtub couple in the coming year -- Lilly wants to know how high the price must be before you favor the wallet in your back pocket over the thing in your front pocket.

Source: AccessRx.