ADA Some Random Thoughts
While we are diligently working on our post-ADA issue there are a few items that should be addressed.
1. 1. Amylin (NASDAQ:AMLN) remains the most valuable property in diabetes. It’s shocking to Diabetic Investor that the Street just doesn’t get it when it comes to the long acting once a week version of Byetta. It is well known the majority of patients are not compliant with their therapy regimen. It does not matter whether the patient is taking pills, injections or a combination of pills and injections. About the only group of patients that are compliant nearly all the time are insulin pump patients. Still the Street is fixated on needle size and mixing issues when it comes to Byetta LAR. Never mind that the drug is extremely effective and it’s once a week injection method fits nicely into the lives of people with diabetes. Before things get off the deep end here a few quick facts. First, the needle for LAR is NOT the size of a hypodermic and it’s not an intramuscular injection. Patients will be injecting in the same zones that insulin patients do with a needle that’s lubricated. Speaking as a former multiple daily injection patient I can say with confidence that my daily insulin injections were less painful then pricking my fingers when I measured my glucose levels. Secondarily the fact that LAR needs to be mixed prior to injection is no big deal. Keep in mind that patients prefer to inject in the privacy of their home and the fact it will take a few minutes to mix LAR is no big deal. The fact of the matter is LAR won’t be big it will be HUGE. And yes it is that simple.
2. 2. Generex Biotechnology (NASDAQ:GNBT) – This is a company Diabetic Investor has followed for many years. Diabetic Investor has always liked the simplicity of Oral-lyn’s delivery device; however we have expressed concern over the type of clinical trials the company has run. It was refreshing to see that the company now plans to run clinical trials here in the US, Europe and Canada. According to the company “The six month trial is expected to include 750 patients with Type 1 diabetes mellitus. Patient enrollment is expected to begin during the third or fourth quarter of calendar year 2007 and expand to several global centers over the course of the study. The primary objective of the study is to compare the efficacy of Generex Oral-lyn(tm) and the RapidMist(tm) Diabetes Management System with that of standard regular injectable human insulin therapy as measured by HbA1c, in patients with Type-1 diabetes mellitus.” This is a positive step for the company as the results should give everyone a clearer picture on Oral-lyn effectiveness.
3. 3. Dexcom (NASDAQ:DXCM) – There is no question that bringing Terry Gregg to run the company is good news. Still Diabetic Investor believes the recent run up in Dexcom shares is a bite premature. Several things need to happen before Dexcom is out of the woods and reimbursement is just one item. Thankfully Mr. Gregg has the knowledge and experience to help Dexcom handle these issues. The real question here is, is he setting up the company to be sold or will he acquire an insulin pump company and make a run at his former employer Medtronic (NYSE:MDT)?
4. 4. Abbott (NYSE:ABT) and Roche are going nowhere in a hurry. Both LifeScan and Bayer (NYSE:BAY) understand that when it comes to glucose monitoring that simplicity trumps fancy technology. LifeScan and Bayer also understand that glucose monitors are no longer considered a medical device and that this market has turned into a consumer product market. Using effective television ads LifeScan has extended their lead over Roche and Bayer has moved past Abbott. For anyone who thinks Navigator, should it ever receive FDA approval, will help Abbott, think again. Navigator has several limitations not the least of which being that users if the product have to wait 10 hours to see any data. Why this fact is ignored by the Street is anyone’s guess. Roche, which recently changed management, appears to be a company without a clear strategy. The Disetronic acquisition has been a complete disaster and their core BGM business is struggling to recover.
5. 5. Insulet (NASDAQ:PODD) and AgaMatrix are both making headway and gaining attention. As we mentioned previously AgaMatrix plans to go public sometime in 2008 and will likely follow a path set by Therasense. While there are many trying to imitate Insulet they have the advantage of being first to market with their wireless insulin pump. Their OmniPod system is taking hold in the marketplace and they appear on their way to lowering their manufacturing costs. Now public the company has the added burden of reporting results on a regular basis. In the long run Diabetic Investor suspects Insulet will become an acquisition target particularly if they are able to add a CGM unit onto the OmniPod. An OmniPod/CGM combo would give the company the ability to give Medtronic a run for their money.
6. 6. While Diabetic Investor looked at several interesting drugs in development we are concerned that with the controversy over Avandia the FDA could change the drug approval process. Bringing a new drug to market is never easy and the controversy over Avandia has just made a difficult task even more difficult.
7. 7. We had our first look at the new SoloStar pen for Lantus and came away impressed. The SoloStar is vast improvement over the cumbersome OptiClick pen and should help Sanofi-Aventis (NYSE:SNY) extend Lantus sales.
8. 8. By far the most impressive booth at the show was once again Novo Nordisk (NYSE:NVO). Novo may not be swift when it comes to bringing new drugs to market but there’s no question they are in the upper echelon when it comes to diabetes.
9. 9. Pfizer (NYSE:PFE) continues to push Exubera and some even believe Exubera will be a beneficiary of the Avandia controversy. Although we did not see it, we were told they have new more user friendly deliver device for Exubera. Even with such a device Diabetic Investor doubts Exubera will ever reach the heights once promised. The Street and the company can’t seem to grasp the fact that no matter how it’s delivered Exubera is still insulin and the majority of primary care physicians are uncomfortable prescribing insulin for their type 2 patients.
10. 10. Finally while we weren’t surprised with all the activity around the Merck (MYSE: MRK) booth, we were comforted to learn that we’re not alone in our thoughts on Januvia. Based on several conversations with physicians they are less than impressed with Januvia yet continue to prescribe the drug mainly because of the Avandia controversy. Merck reps have also got primary care physicians believing that Januvia is an oral version of Byetta. To Diabetic Investor this demonstrates two important points. First everyone realizes that Byetta is safe and effective. Second, primary care physicians have a love affair with pills even when there not particularly effective.
David Kliff
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