How will Novo perform?

How will Novo perform?

This Thursday Novo Nordisk (NYSE:NVO) will once again be in front of an FDA advisory panel for Victoza®, only this time the company is not seeking an indication for treating diabetes, this time they are looking for an approval as a treatment for obesity. Now everyone knows excuse the play on words here, that obesity is huge problem. That should Novo receive approval it could alter the trajectory for Victoza sales.  According to an article that appeared in Nature; “Data are for the seven major markets (United States, France, Germany, Italy, Spain, United Kingdom and Japan). The obesity market is forecast to attain robust annual growth (21%) over the 2011–2021 forecast period; major-market sales will grow from $359 million to $2.4 billion.”

Based on all available data Diabetic Investor sees no reason why the FDA won’t grant Novo their wish. Besides all the data the company has submitted to the FDA, there are years of patient experience.  Victoza is not the perfect drug and Diabetic Investor does not anticipate a clean approval, however there is enough evidence to support an approval as a treatment for obesity. The question is will Novo have a better day before the panel then they did back when they were seeking an approval for the treatment of diabetes.

For those with short memories back in the day it appeared Novo would have a fairly easy time in front of the panel. The publicly available data for Victoza looked good and everyone pretty much expected the panel meeting to be a cake walk. That was until the just before the meeting when the meetings material was released that we discovered a possible connection between Victoza usage and Thyroid cancer. An issue which Novo devoted a great deal of attention too. Most of the experts Diabetic Investor spoke with before the meeting were stunned by this revelation.

What was even more amazing was the amount of time the company spent covering this issue in front of the panel. Nearly two thirds of the company’s presentation was devoted to this issue. Now to add a little perspective here Thyroid cancer is not just rare but slow growing. Nor is thyroid cancer a killer, most experts in the area agree a patient with thyroid cancer will die with the disease not because of it. This is not to say the issue should not be addressed rather the extent it was addressed.

Yet in typical Novo fashion, a company that has never meet a study they didn’t like, the company went overboard. Put another way, most experts agreed it was Novo who made this an issue. That the sheer size of the data set created an impression in the panels minds that this was a serious issue, when in reality it was a minor issue. All of sudden what looked like a sure thing, that Victoza would be approved, was thrown into doubt.  Worse based on the questions at the meeting this focus on thyroid cancer created the impression in the panels mind that perhaps there were other issues with the drug.

Looking over the briefing document the company has submitted for Thursday meeting it appears the company has learned from past mistakes. Yes they address the issue but thankfully no overkill. (The company’s documents can be found at http://www.fda.gov/downloads/AdvisoryCommittees/CommitteesMeetingMaterials/Drugs/EndocrinologicandMetabolicDrugsAdvisoryCommittee/UCM413318.pdf)

Since these documents do not include any slides the company plans on using we can only hope they too don’t go overboard.

Let’s not underestimate the importance of this meeting as the stakes for Novo are high. As we noted just yesterday the GLP-1 market is becoming more competitive and Novo position while strong is tenuous. Although Diabetic Investor does not see physicians switching patients currently on Victoza to Bydureon or Tanzeum, we do see prescription growth slowing because of these drugs.  An approval for obesity opens up a whole new territory for the drug and could add millions in revenue.

Let’s hope for Novo’s sake the company brings their A game and has learned from past mistakes.