Merck has lost patent protection in the U.S. for cholesterol-lowering drug Zocor. This is the largest-selling drug to be open to generic competition. Three other drug companies will be legally allowed to sell simvastatin, the active ingredient in Zocor. Beginning in December 2006, companies will be allowed to make simvastatin provided that its version is chemically equivalent to Zocor.

As a result, the price of a dose of simvastatin will likely drop 30% or more in the next few days, and by as much as 90% next year, to about 30 cents a pill, according to analysts. Merck plans to cut the price of branded Zocor to be competitive with generic simvastatin, which may cause the price of the generic to fall further during the next few months. U.S. sales of Zocor, which until now has sold for about $3 a daily pill, were $3.1 billion in 2005.