Is the FDA between a rock and a hard place?
As we await the FDA’s decision on Janumet™, the combination of Januvia and metformin as one pill, the question has to asked; Is the FDA between a rock and a hard place. According to officials at Merck (NYSE:MRK) the FDA’s decision should come down sometime in the next weeks. A decision that most on the Street believe will be affirmative as Januvia was approved with relative ease and metformin effectiveness is well established. What possible reason could the FDA have for not approving or delaying Janumet which is merely combining two drugs which have already received approval?
Part of a new class of drugs known as DPPIV’s, Januvia is off to a strong start. Januvia now accounts for 8.2% and 5% of new and total prescription market share.
The drug has also been the beneficiary of an incredible series of events. While not a direct competition to Byetta from Amylin (NASDAQ:AMLN), the supply issues related to Byetta which are now gone did help Januvia. Based on recent prescription data Byetta appears back on track however the supply issue could have not come at a worse time for Byetta. Sales were accelerating as physicians and patients were falling in love with the drugs effectiveness and proven ability to help patients lose weight. Although the drug must be injected twice daily, patient fears of injections were overcome by ease of dosing and weight loss. While there is no way of knowing where Byetta would be today had there been no supply issues, Diabetic Investor believes the supply issue cost Amylin an opportunity to blunt the arrival of Januvia.
Next came the FDA’s decision to delay further Galvus from Novartis (NYSE:NVS). Galvus is also a DPPIV and was widely expected to arrive on the market shortly after Januvia. The drug is delayed at the FDA sue to some skin lesion issues which appeared in primate studies. While Novartis has publicly stated they plan on pursuing Galvus based on the most recent delay it will be at least a year before Galvus hits the market. For all practical purposes even if Novartis proceeds with Galvus, the drug will face an uphill battle should it ever reach the market.
Adding to Merck’s lucky streak was the news that patients using Avandia were experiencing a higher incidence of bone fractures. This adverse event comes on top of the drugs other known side effects edema and weight gain. The main benefit of Januvia was never that it was more effective than the drugs currently on the market; rather it worked as well but with fewer side effects. In essence the news on Avandia was just one more reason for physicians to use Januvia.
At this point in time it appears Merck is in the catbirds seat as they have the only DPPIV on the market and won’t face any serious competition for at least a year, most likely longer. However the company’s lucky steak could come to screeching halt should the FDA delay the approval of Janumet, make the company change the label for Januvia or both. There are many in the research community who believe the FDA acted hastily with Januvia approving the drug too quickly. This group points to the issues with Galvus as evidence that there is much we don’t know about this new class of drugs. Merck obviously disputes this belief stating that Januvia’s method of action is different than Galvus.
While it is within the FDA’s power to delay Janumet or have the company change the Januvia label, just what would the ripple effect be? Would physicians stop prescribing Januvia and what would they do with their patients already on the drug? Will anything but an approval open a Pandora’s box for this entire drug category?
Even if Janumet is approved will the issues surrounding Galvus have a carryover affect?
Based on our physician and patient interviews there is a mixed reaction to Januvia, some seeing the drug as ineffective while others see it as effective as other drugs in the category. Having been down this road before with Rezulin, Diabetic Investor remains skeptical that Januvia is free from adverse events. It would be a tragedy if six or eight months from now patients on Januvia begin to experience adverse events. The FDA is already under intense scrutiny over how they approve drugs and whether or not Januvia was approved too quickly. In the end no matter what the FDA does with Janumet; the agency will be in a difficult position.