Bydureon is one step closer to finally being on the market, but this is far from its last hurdle to becoming a money-maker for the three companies that have worked tirelessly over the last few years to put the diabetes drug in the hands of patients.
Amylin Pharmaceuticals (AMLN), Eli Lilly (LLY), and Alkermes (ALKS) announced Thursday night that they had resubmitted their application for the once-weekly injectible Bydureon to the FDA and are currently awaiting a new PDUFA date, the date at which the FDA will decided up on approval of the drug.
While resubmission of the application in such a short time -- the companies received their Complete Response Letter rejecting the approval of the drug in March -- is definitely a positive for the makers of this closely watched medication, this doesn’t exactly spell success for the drug.
If approved, Bydureon, previously known as Byetta LAR, will likely be the third drug of its kind to hit the market. The first was its predecessor by the same three companies, the twice-daily injectible Byetta, and the second is the recently approved once-daily injectible by Novo Nordisk (NVO) Victoza.
All three drugs are part of class known as GLP-1 agonists, a newer class of diabetes drugs that works like the naturally occurring GLP-1 compound in the body to slow glucose absorption in the gut and thus allow a diabetic’s slow insulin response to catch up. Unlike the naturally occurring compound, the agonists aren't easily broken down by the body’s enzymes. The GLP-1 agonist class also attaches to an appetite receptor in the brain and decreases hunger, leading to weight loss in patients.
Convenience is a huge issue for the 180 million diabetics worldwide (that number is expected to grow to 360 million by 2030) that depend on these drugs to regulate their blood sugar when their own bodies cannot. Certainly Bydureon would have the best advantage in this category because it is injected only once a week while the others have to be taken daily, but time is not the only convenience factor that plays a role here. The size of the needle used for the injections (resulting in a difference in the amount of pain at the injection site), as well as the ease of use for the administration device are big factors to patients.
Leerink Swann analyst Joshua Schimmer noted in a recent publication to investors that the needle type that will be used with Bydureon tends to be more painful when compared with the needle used for Victoza administration and could be even more painful still once the viscous nature of the drug is taken into account.[Viscosity matters a lot with respect to pain; I would replace the phrase, “could be” by “will be.”] As for the administration devices, Leerink Swann said doctors had an easier time explaining the twist and click mechanism of the Victoza pen compared to a lengthier explanation for how to use the also ready-to-administer injectible Byetta pen. Bydureon is currently even more inconvenient -- it will require the reconstitution of the powered drug (something the FDA fears could be done wrong) and the use of a syringe.
Beyond the convenience factor are two other problems that stand in the way of Bydureon being the blockbuster that Amylin, Lilly, and Alkermes hope it will be. Other companies are also currently developing once-weekly GLP-1 injectibles. Roche is in the late stages of testing with its version taspoglutide, which the company is expected to submit for approval in 2011. Aside from the Roche drug, Novo Nordisk is also following up Victoza with a once-weekly version, which isn't as far along. Taspoglutide has performed well, and often better, when studied in comparison trials to other diabetes drugs.
The GLP-1 class of drugs has had its share of problems so far. The drugs are known to increase the likelihood of patients developing an oft-fatal condition called pancreatitis. The drugs have also been known to cause kidney problems, including renal failure. The latest issue to crop up with the GLP-1s is their potential to cause thyroid tumors -- although this has only been seen in rodents so far.
The many risks associated with the class of drugs has kept the patient population that uses these drugs rather small in comparison to the vast number of diabetes sufferers -- physicians have been compelled to go with alternative drug therapies rather than bring about further harm for their patients. Byetta sales were only $667 million for all of 2009, while the diabetes market is one of the largest sectors in the global health-care industry with a market value over $25 billion.‹
* Says U.S. prescription data encouraging for Victoza sales
* Victoza Q1 sales 370 million DKK, two-thirds is stocking
* Raises 2010 operating profit, sales guidance
* Shares up 1 percent, outperform European peers
By Anna Ringstrom and Karin Jensen
COPENHAGEN, April 27 (Reuters) - World No.1 insulin maker Novo Nordisk posted forecast-beating first-quarter profits, helped by strong sales of new potential blockbuster drug Victoza and its modern insulins, and raised its outlook.
Operating profit rose to 4.38 billion Danish crowns ($784 million) from 3.81 billion a year earlier, beating all analyst estimates in a Reuters poll.
"The increasing use of our modern insulins is the primary driver of growth," Chief Executive Lars Rebien Sorensen said. "Furthermore, the roll-out of Victoza, our new treatment for type 2 diabetes, is progressing well in both the U.S. and Europe."
U.S. healthcare reform had a minor negative sales impact.
Group sales rose 9 percent to 13.7 billion crowns, beating a forecast 13.5 billion. Sales in the biggest product group, modern insulins, rose 17 percent to 5.86 billion crowns, topping a forecast 5.84 billion.
Victoza, which after delays was launched in nine European countries last year and in the United States in February, is now commercially available in 15 countries.
"The initial performance in the U.S., as measured by prescription level data, is encouraging," Novo said.
Sales of Victoza reached 370 million crowns in the quarter. But suppliers' stock building accounted for two thirds, and Deutsche Bank said in a note that suggested a weaker trend this quarter.
The bank said launch costs had been lower than expected.
Novo expects its biggest new drug hope, due for launch in Japan this quarter, to be a blockbuster, meaning it would reach $1 billion in sales within its first five years on the market, despite the U.S. approval including a boxed cancer warning.
Novo Chief Financial Officer Jesper Brandgaard told Reuters he expected Victoza sales to fall this quarter. "From there, it will grow. We'll be very disappointed if we don't exceed 1 billion crowns in Victoza sales this year."
"We see a very stable uptake of patients week for week."
Novo is however bracing for fiercer competition.
After delays, Eli Lilly and Amylin Pharmaceuticals Inc expect U.S. approval this year for Bydureon, a once-weekly version of their Byetta.
Taspoglutide, under development by Roche Holding AG and Ipsen SA, is another once-weekly GLP-1 drug for Type 2 diabetes.
Brandgaard said he hoped use of GLP-1 class drugs, to which Victoza belongs, would grow to 5 percent of the diabetes care market in the next few years from a current 3 percent.
RAISES OUTLOOK
"It's a good report with a small (outlook) upgrade. Victoza has had a really good start," said Sydbank analyst Rune Dahl.
Novo raised its 2010 outlook to see sales growth in local currencies of 7-10 percent and reported growth around 3 percentage points above that.
"This should allay any fears that the market may have had about the impact of U.S. healthcare reform," PiperJaffray said in a note.
Novo forecast operating profit growth in local currencies of more than 10 percent, with reported growth around 6 percentage points above that.
The previous guidance, given in February, had been for sales growth of 6-10 percent and profit growth of around 10 percent.
"The market had expected an upgrade and Novo delivered," said Soren Sorensen, head of equities at Amagerbanken. "The results confirm that the share price rise we have seen has been justified," he said.
Some analysts said the outlook was still conservative and there was room for more upgrades.
Shares in Novo, which have outperformed European peers this year, were up 1 percent at 1009 GMT while the STOXX 600 European healthcare index was down 1 percent.
Morgan Stanley said the value of Novo's shares still lagged improving fundamentals. "Novo is a structural growth story with limited patent risk ... and expanding margins."
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