A Step Closer

A Step Closer

This morning privately held Intarcia announced top line results from the phase 3 FREEDOM-CVO Trial for ITCA 650. According to a company issued press release;

“Intarcia Therapeutics, Inc. today announced top-line results from its more than 4,000 patient Cardiovascular Safety Study (FREEDOM-CVO trial), clearing the last major clinical hurdle in the global FREEDOM Phase 3 Clinical Trial Program that started in early 2013. Regulatory filing in the U.S. is targeted for end of 3Q, 2016. The Company also announced a $75 million round of debt financing timed to facilitate ongoing scale-up of manufacturing and the production of inventory for the anticipated global launch of ITCA 650 in type 2 diabetes. The new credit facility is with MidCap Financial and Silicon Valley Bank.”

This news comes just as things are heating up in the growing GLP-1 category, as besides the Intarcia micro-pump Novo Nordisk (NYSE: NVO) is working on an oral version of their GLP-1 semaglutide. Currently in phase 3 trials this formulation has the potential to change not just the GLP-1 landscape but also the entire diabetes drug space. Together Diabetic Investor sees these two GLP-1’s as having the greatest potential as both could easily become blockbusters in their own right.

As a side note the growth of the GLP-1 category is just another nail in the conventional glucose monitoring coffin, as unlike insulin, GLP-1’s are fixed dosed drugs which do not require a glucose reading prior to dosing.

Given that the Intarcia micro-pump and oral version of semaglutide won’t be on the market for another 6 months or longer here’s how we see the GLP-1 playing out until these new products arrive. As Novo noted during their last earnings call we will continue to see the share erosion for their once-daily GLP-1 Victoza continuing. This erosion will be slow as physicians convert patients to one of the three once-weekly GLP-1’s, Bydureon from AstraZeneca (NYSE: AZN), Trulicity from Lilly (NYSE: LLY) or Tanzeum from GlaxoSmithKline (NYSE: GSK). Also note that Novo will have the injectable version of semaglutide, also a once-weekly, on the market in the not so distant future.

The battle in the once-weekly category as with every other diabetes drug will come down to formulary position. A battle that seems to be being won by Lilly but is being fiercely fought by AstraZeneca. We see this battle getting even more intense once the injectable version of semaglutide arrives as Novo will not be shy about using price and/or rebates to gain formulary access.

It’s difficult to gauge the impact as the GLP-1 category grows on the insulin market. We originally believed that the growth of GLP-1 usage would adversely impact the insulin market. Yet, looking over the numbers this does not appear to be the case. However, this does not mean this won’t happen in the future. As we anticipated GLP-1 adoption has grown over the years as physicians have become more comfortable with this category. Also as anticipated twice daily Byetta was replaced by once daily Victoza which is now being replaced by the once-weekly offerings.

As these once-weekly begin gaining greater traction, which they will, this is when we could see a material impact on the insulin market. An impact that will only intensify with the arrival of the Intarcia micro-pump and the oral version of semaglutide. Add in the coming of biosimilar insulin’s and it’s easy to understand why Novo, Lilly and Sanofi (NYSE: SNY) have invested heavily in the GLP-1 category as they all know their respective insulin franchises will experience tough times ahead.

With the annual ADA confab just around the corner in steamy New Orleans, look for Intarcia to get lots of attention along with the oral version of semaglutide. These are perhaps two of the more exciting products we have seen in a few years. Both have the potential to be blockbusters and will definitely impact more than just the GLP-1 category. Yep, we’re one step closer to another transformative event in this wacky world of diabetes.