Can’t wait for the title fight

Can’t wait for the title fight

Now that we’re less than 100 days away from the Bydureon PUDFA date, the snipping between Novo Nordisk (NYSE:NVO), Amylin (NASDAQ:AMLN) and to some extent Lilly (NYSE:LLY) has begun in earnest. Based on what Diabetic Investor is hearing from the reps in the field, on all sides, this is sure to be one heck of a fight. Already there are reports of Novo reps down talking Bydureon during their office visits, a fact that seems to delight Amylin reps.

Frankly Diabetic Investor can’t wait until the PUDFA date as this will provide some of the best copy in our history and that’s really saying something given the great copy we continue to get from the diabetes community or as we like to say around here the diabetes community is the gift that keeps on giving.

One of the more amazing aspects of this fight is the amount of free publicity Bydureon is getting well before its official launch. Not since the ill-fated launch of Exubera have we seen so much banter about a product that has yet to receive FDA approval. Hopefully for the folks at Amylin and Lilly, Bydureon will live up to all this hype and not suffer the same fate as Exubera. It would not be an overstatement to state that there are few physicians who have not at least heard about Bydureon.

All this advanced publicity presents a double-edged sword for Amylin/Lilly and presents an opportunity for Novo. Since the product is not approved here in the US and there is only limited information as to how the product is doing in Europe were it is approved, this fact allows for a great deal of speculation. At the moment Novo reps are trying to convince physicians that although Bydureon is dosed just once a week that the needle is the size of a titan missile and that patients will have issues properly mixing the drug. They are also doing their best to convince physicians that Victoza, their once daily GLP-1, outperforms Bydureon in head to head comparisons. Novo reps are also openly speculating that Bydureon will be approved with a Black Box warning due to pancreatitis, a dangerous strategy as Victoza also carries a Black Box warning over thyroid cancer concerns and also has a pancreatitis issue.

It’s unclear what impact, if any, these physician interactions will have when Bydureon is officially launched. Given that Bydureon is not yet approved here it’s difficult for Amylin reps to respond to all this speculation and banter. On the flip side however this does allow them a glimpse of what they’ll be up against when the real battle begins.

Here are the key issues as seen by Diabetic Investor;

Overall the biggest question is once-weekly versus once-daily. Given that based on all current data the two drugs both perform well and both have issues, will once-weekly dosing combined with a larger needle size and the need for the product mixing trump the simplicity of pen delivery, no mixing and a smaller needle size.

Diabetic Investor does not believe labeling will be much of an issue; even should Bydureon come with a Black Box warning on pancreatitis or thyroid cancer. Given the Victoza label and what’s known about the drug – labels are basically a draw.

Perhaps the biggest issue of all will be formulary placement. Based on how Lilly has priced Bydureon overseas actually lower than the 1.8mg dose of Victoza, Diabetic Investor believes they will not make the mistake of asking too high of a premium for Bydureon. Diabetic Investor also sees Novo in a tougher position here, while they do have established formulary placement for Victoza they must decide whether they want to use price as a weapon to blunt Bydureon. Should they decide to undercut Bydureon in an attempt for better placement and therefore create a greater disparity between the two drugs from a price perspective; they risk not just a price war but lower overall margins.

Taking a look at how aggressive Lilly has become in the insulin market, a move that has not gone unnoticed by Novo, Diabetic Investor suspects Lilly if need be will do whatever they have too to compete. While Victoza is important to Novo Nordisk the drug is not mission critical, the same cannot be said about Bydureon as this drug is mission critical for both Amylin and Lilly. Put bluntly neither Amylin nor Lilly can afford to swing and miss with Bydureon.

The key untold story here is that this battle would be no battle at all if Bydureon were coming to market in a patient friendly pen delivery system; something that won’t come along until late 2012 or early 2013. That fact should factor into how Amylin and Lilly strategize. If Amylin and Lilly are smart they would actually plan a two-fold strategy; one for the initial launch the second for when the pen delivery system becomes available. The goal for the initial launch would be to hold their own against what is sure to an all-out assault by Novo, basically proving that patients prefer the convenience of once-weekly dosing. Should once-weekly dosing win the day as we expect the companies could then shift gears when the Bydureon pen arrives leaving Novo with few if any options.  Given what we know to be true today we cannot envision too many physicians choosing once-daily dosing when a once-weekly option comes in a patient friendly pen delivery system.

All along Diabetic Investor has believed once-weekly would win given that therapy non-compliance is a major issue with physicians. These physicians understand this issue better than anyone as they know from experience that it really doesn’t matter what therapy regimen they prescribe if the patient isn’t following that regimen. This is one reason Lantus became the world’s number one selling insulin and why pen delivery systems continue to grab market share. When it comes to treating diabetes it’s not just about which therapy options are safe and effective, equally important is having therapy options that are patient friendly and this includes how often they take their meds.

Everyone outside of diabetes foolishly believes that just because certain drugs are delivered orally that patients actually take all their pills. This widely held belief is not just untrue but shows the opportunity for drugs like Bydureon. It’s no accident that Novo who just submitted Degludec and DegludecPlus to the FDA, insulin’s that require fewer injections, and Sanofi-Aventis (NYSE:SNY) is working on an even longer acting version of Lantus. The simple fact when it comes to any diabetes treatment, no matter how it’s delivered is that the fewer times a patient has to take their meds the better.

As it stands today Diabetic Investor believes Bydureon has all the right attributes to become a blockbuster the only real issue with the drug are its two squabbling partners. Think it’s about time Lilly and Amylin stop all the silliness and get down to the business of changing the way diabetes is treated. It won’t be easy by any means which is just one more reason they don’t need the added distraction of fighting amongst themselves.  As Abraham Lincoln stated in his famous House Divided speech – “A house divided against itself cannot stand.” The stakes may not be as dramatic as when Lincoln delivered his speech but the principle remains the same.