Roche dumps Stratis KPR, three firms vie for Xenical

NEW YORK: In a move likely to have major implications within the cut-throat healthcare sector, Hoffmann-La Roche has put its Xenical business - rumored to be worth millions - up for grabs.

NEW YORK: In a move likely to have major implications within the cut-throat healthcare sector, Hoffmann-La Roche has put its Xenical business - rumored to be worth millions - up for grabs.

NEW YORK: In a move likely to have major implications within the

cut-throat healthcare sector, Hoffmann-La Roche has put its Xenical

business - rumored to be worth millions - up for grabs.



Xenical, an anti-obesity drug that has been hyped mercilessly via a

dollars 70 million ad campaign, had previously been handled by

healthcare specialists Stratis KPR. Ogilvy, Edelman and Manning, Selvage

& Lee have been put on the shortlist for the account, and will present

final proposals this week.



An interesting sidebar to the story is the fate of Stratis. With fee

income of dollars 6.3 million in 1998, the firm might have difficulty

weathering the loss of a prestigious multimillion-dollar account.



Stratis CEO Bob Muratore scoffed at rumors that the loss of the Xenical

business would sink the agency. ’The loss of the Roche account was

unfortunate,’ he said. ’But business will go on.’



While Muratore admitted that some of the firm’s employees who had been

working on Xenical were downsized, he claimed the layoffs were tempered

in part by as-yet-unannounced wins secured late in the year. As a

result, several employees slated to be laid off were immediately

rehired.



A second - and simultaneous - blow to Stratis was the departure of

GM/EVP Helene Paseornek to Edelman. While the timing seems incredibly

coincidental, an Edelman spokesperson denied any link between Paseornek

joining the firm and the Xenical business becoming available.



Of the three agencies pitching for Xenical, only Ogilvy does not

currently work with Roche. Edelman handles Tamiflu (an influenza

therapy), Rocephin (for ear infections) and Lariam (an anti-malarial

treatment), while MS&L currently holds Roche’s HIV portfolio, an

osteoporosis treatment and a Hepatitis-C therapy.



Though securing the Xenical business (and thus a relationship with

Roche) would seem a major coup for Ogilvy’s healthcare practice, the

agency doesn’t seem daunted by the fact that its competitors have worked

extensively with Roche. ’Every relationship has to start somewhere,’

said Kym White, managing director of the firm’s health and medical

practice. ’Being the new kid on the block can be a good thing.’



While sales of Xenical have been stellar - more than 96,000

prescriptions during its first four weeks on the US market - there are

some hurdles to overcome, not the least of which is Xenical’s

embarrassing side effects (flatulence with discharge, among others).



Terry Hurley, Roche’s director of public affairs for Xenical, confirmed

the agency change but declined to comment on it. He attempted, however,

to sell his colleagues in PR on Xenical’s benefits: ’It’s my experience

that PR people don’t get enough exercise or eat properly.’



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