In France, delicate questions over Gardasil

NEW YORK (CNNMoney.com) -- The French government has agreed to subsidize a cervical cancer vaccine made by Merck for teenage girls and young women, according to Merck's marketing partner, French drugmaker Sanofi-Aventis.

But there's a catch to Sanofi's (up $0.18 to $41.59, Charts) coup with the national health system: eligibility for coverage depends largely upon the patient's virginity.

The vaccine is being mandated for 14-year-old girls, regardless of their sexual practices, said Armelle Bouvier, spokeswoman for Paris-based Sanofi-Aventis, which sells the Merck (up $0.16 to $48.82, Charts, Fortune 500)-made Gardasil in France.

But girls and woman aged 15 to 23 will qualify for 65 percent coverage from the French government only if they are virgins, or lost their virginity within the past year, said Bouvier. She added that the three-dose regimen will cost about $550.

The human papilloma virus that is blamed for causing most cases of cervical cancer is sexually-transmitted, so the vaccine provides the best protection in girls or women who have never had sex.

"The best time to vaccinate a girl is before she gets into contact with the virus," said Bouvier. She said that the "peak of incidents" occurs between the ages of 14 and 24, and that cervical cancer kills three women a day in France.

Bouvier said the policy of coverage was established by the French health authorities, not Sanofi, and that the virginity or sexual activity of individual patients would be determined by physicians, not the drugmaker.

Les Funtleyder, analyst for Miller Tabak, said that drug or vaccine sales typically get a boost when they become eligible for coverage by a government health plan. But he said the prospect of being asked "invasive questions" about sexual activity would "probably overhang sales."

In the United States, Gardasil is FDA-approved for girls and women aged 9 to 26. The vaccine is considered 100 percent effective in blocking strains of HPV that cause 70 percent of cervical cancer cases. Gardasil also prevents 90 percent of vaginal lesions, including genital warts.

The Food and Drug Administration approved Gardasil in June 2006 and many analysts have projected the drug to be a multi-billion dollar blockbuster. Merck, which developed the vaccine, said that sales in the first quarter of 2007 totaled $365 million.

The biggest competitive threat to Gardasil is GlaxoSmithKline's (up $0.08 to $51.62, Charts) Cervarix, another vaccine for HPV that is available in Australia and is being reviewed by the FDA and European authorities.