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There have been several noteworthy developments in the drug space recently, which will likely have a material impact on the companies in this sector and the markets they serve. Companies mentioned in this review include Pfizer Inc. (PFE - Free Pfizer Stock Report), Merck & Co. (MRK - Free Merck Stock Report), GlaxoSmithKline (GSK), Abbott Laboratories (ABT), Roche Holding AG (RHHBY), and Eli Lilly & Co. (LLY).

Third-Quarter Earnings Season

Many of the world’s largest drugmakers are on the threshold of reporting their respective third-quarter results. With several big-name drugs losing patent protection in the second and third quarters, the investment community will undoubtedly be interested to see how top lines are holding up in the wake of increased generic competition in the market. Some noteworthy releases to put on the calendar include Merck & Co. (October 26th), Pfizer Inc. (October 30th), and GlaxoSmithKline (October 31st).

Roche and Lilly to Take Part in Alzheimer’s Prevention Trial

Both Roche Holding AG and Eli Lilly & Co. have recently been selected for a high-profile clinical study testing the effectiveness of their respective Alzheimer’s medications. The trial, which is expected to start early next year, will test 160 patients worldwide with inherited gene mutations that typically lead to Alzheimer’s symptoms when they are as young as 30. Drug studies over the past several decades have failed to slow the progression of Alzheimer’s in patients who have already experienced dementia. The goal of this new trial will be to find a treatment that could act as a deterrent for people that have not yet experienced dementia, but have a family history of the disease. The drugs chosen for the study are Roche’s gantenerumab and Lilly’s solanezumab. Given the growing number of Alzheimer’s cases around the world, a successful treatment could represent a high-growth opportunity for either company.

Abbott  Sees Promise in Hepatitis C Drug

On October 15th, Abbott Laboratories announced that its experimental hepatitis C medication cured 99% of patients in a new clinical trial. Those who participated in the study had genotype 1 hepatitis C, which is one of the most common and hardest-to-treat forms of the disease. Due to the favorable mid-stage results, the company is preparing to move forth with larger, late-stage clinical trials in hopes of bringing the new treatment to market by 2015. Management indicated that assuming regulators give the green light, the product could eventually exceed $2 billion in annual sales, and become a true blockbuster. Hepatitis C is a viral disease that attacks the liver. It is believed to afflict roughly 180 million people worldwide.

Merck Reports Osteoporosis Drug Success

Earlier this week, Merck & Co. announced promising results from a phase II drug trial involving its new osteoporosis drug, odanacatib. The company noted that the study showed significant improvement in bone mineral density scores in participants aged 60 years and older, who were given the new drug versus those given a placebo. In recent Value Line reports, we have cited odanacatib as a strong potential pipeline candidate of Merck, noting that its potential contribution in the coming years could help to partially mitigate the patent loss of Singulair this past August. The company plans to submit applications for the drug to U.S. regulatory agencies in the first half of 2013.

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.