Drug safety was Pozen’s (NASDAQ:POZN) message for osteo-arthritis drug Vimovo even before the drug secured regulatory approval in 2010.

Vimovo combines the delayed-release pain reliever naproxen with AstraZeneca’s omeprazole, the combination drug was intended to bring to the 151 million osteoarthritis patients worldwide the pain relief of naproxen in a form that poses less gastrointestinal risks. And certainly the drug would be safer than the class of Cox-2 inhibitor pain drugs that are associated with heart risks.

Despite that drug safety message, Vimovo sales failed to reach the levels that Chapel Hill-based Pozen expected from its larger drug partner.

Pozen disclosed today that AstraZeneca plans to stop promoting Vimovo in the United States and Europe. That leaves Pozen searching for options to boost sales of a drug that the company expected would be widely accepted because of its better safety profile.

“These are things that for whatever reason, AstraZeneca was not able to tap into,” Plachetka said on a conference call with analysts. “Maybe someone else can.”

There are no immediate plans to find a new drug partner. AstraZeneca still holds the commercialization rights to the drug in the United States and Europe.

Plachetka said that it’s too early to say what Pozen will do with Vimovo and the company is still weighing its options since it heard the news from AstraZeneca last Friday.

Disappointing sales

While AstraZeneca’s decision to stop promoting Vimovo in the United States and Europe, except Spain and Portugal, is disappointing to Pozen, it is not a surprise. Global sales of the drug were $19.7 million in the first quarter, an increase of 7 percent compared to previous quarter and up 24 percent compared to a year ago. But much of Vimovo’s growth has come from global sales. U.S. and European sales of the product have been flat.

The disappointing sales have been a sore point with Pozen for the last two years. In 2011, Pozen paid for a third party study to review Vimovo. The study concluded Vimovo addressed a medical need for patients but payers and providers were unconvinced of the drug’s value.

With AstraZeneca holding all of Vimovo’s commercialization rights, Pozen’s revenue from the drug comes solely from royalties. Pozen reported a first quarter royalty of $1.4 million, a 10 percent increase compared to the first quarter of 2012.

AstraZeneca has offered discounts and coupons to try to move the needle on sales to little effect. U.S. and European patients will still be able to get the drug when AstraZeneca phases out its promotional efforts. But those promotions will go away.

Plachetka put the best possible light on the AstraZeneca decision by suggesting that Pozen could still end up coming out ahead. Those discounts cost Pozen money. Even if Vimovo sales stay the same, Pozen would make more money because it’s not paying for the discounts. Plachetka added that global sales of the drug continue to grow and Pozen continues to earn royalties from those sales. And Pozen’s royalty rate for Vimovo sales outside of the United States will increase in 2016 from 6 percent to 10 percent.

But the United States and Europe represent the two largest drug markets and the biggest opportunities for Vimovo. Without U.S. and European sales promotion, it will be hard for the drug to grow its sales in those markets.

Discussions with AstraZeneca

For now, Plachetka said it’s too early to assess what impact AstraZeneca’s decision on Pozen’s revenue stream. But investors have already looked unfavorably on the development and Pozen’s stock fell 15 percent in Wednesday mid-day trading.

Vimovo right now just happens to be a poor fit with AstraZeneca’s current focus, Plachetka said. The British pharmaceutical company is now focusing on cardiovascular products, particularly its drug Brilinta, which reduces risks for heart attacks or stroke. An osteo-arthritis drug doesn’t match up with those priorities.

Plachetka said that Pozen has talked in the past with AstraZeneca about the possibility of getting Vimovo’s rights back so that Pozen could find another drug partner. But he told analysts that the company has not yet had enough time to run through its options and go back to AstraZeneca. Now it looks like Pozen will have to revisit those discussions.