Lilly/Alkermes Release Data on inhaled insulin – What are these people thinking?

Lilly/Alkermes Release Data on inhaled insulin – What are these people thinking?

This morning Lilly (NYSE:LLY) and Alkermes (NASDAQ:ALKS) released data from a Phase 2 clinical study of inhaled insulin in people with type 1 diabetes. Patients achieved an average A1C level of 7.9 using the Lilly/Alkermes system, compared to 8 for the injection group. Unfortunately the American Diabetes Association (ADA) defines good control as patients with an A1C of 7 or below. Amazingly shares of Lilly and Alkermes were up on this news.

Just last Thursday a Food and Drug Administration (FDA) advisory panel recommend that Exubera, another form of inhaled insulin from Pfizer (NYSE:PFE), Sanofi Aventis SA (NYSE:SNY) and Nektar Therapeutics (NASDAQ:NKTR), be approved for use. In clinical studies for Exubera 28% of the patients using Exubera achieved an A1C level of 7 or below compared 30% in the injection group. The panel’s decision was hailed as a major benefit to the millions of patients with diabetes. Several analysts believe Exubera will soon become a blockbuster drug.

What Diabetic Investor wants to know is why are people so high on these products when they really don’t work that well. At least with Exubera 28% of the patients were able to achieve good control that still means in 72% of the patients using the drug failed to reach target A1C. It’s difficult to recall people being so high on any other drug that failed to work 7 out 10 times. In the case of the Lilly/Alkermes product an average A1C of 7.9 could hardly be considered a success. That’s like saying the Bears beat the Redskins because they came within a field goal of winning the game.

The bottom line here is that the street is enamored with inhaled insulin for one reason and one reason only; patients using inhaled insulin could avoid the pain of daily injections. Both Exubera and the Lilly/Alkermes studies trumpet the fact that patients overwhelmingly prefer inhaling insulin to injections. Now that’s a real shocker.
Here Diabetic Investor sees Lilly/Alkermes having the edge because of their delivery device. Diabetic Investor has long warned not to get overly excited about Exubera due to the size and difficulty using their delivery device.

Left unsaid here is the fact that in both cases the drug really didn’t work that well. The fact that studies showed that the majority of patients taking insulin injections did not reach goal speaks volumes as to the difficulty of insulin therapy. This is one reason primary care physicians are hesitant to prescribe insulin therapy. (Over 80% of people with diabetes are treated by a primary care physician.) Patients on insulin require hours of training, something primary care physicians are not equipped or reimbursed for.

Once on insulin patients need to test their glucose levels at least four times each day, understand how different food groups affect glucose levels and the effects of exercise, stress play. Unlike oral medications or Byetta, insulin is dose dependent meaning that the amount taken can vary from meal to meal base on a wide variety of factors. In other words reaching a target A1C takes a great deal of effort from both the patient and physician. Changing the insulin delivery method does nothing to change this fact.

This is one of many reasons why Diabetic Investor does not believe inhaled insulin will not be a commercial success. Of course there is a market for this type of insulin delivery; however it is a niche market. The fact of the matter is patients and physicians prefer drugs that not only work but are easy to use. As effective as insulin can be it is not easy to use no matter how it’s delivered.

This is also the reason we believe Byetta from Amylin (NASDAQ:AMLN) is headed for blockbuster status. Unlike insulin therapy patients on Byetta do not need to test their glucose levels as Byetta is not dose dependent. Patients simply inject the exact same amount twice each day no matter what. More importantly Byetta has proved to be very effective. In clinical studies nearly 50% of the patients on Byetta achieved an A1C level of 7 or below. In addition Byetta has proved equally effective in promoting weight loss. In one study that compared Byetta to Lantus, a long-acting insulin that is injected once a day, both drugs proved effective in lowering A1C however while patients using Lantus gained weight, patients on Byetta experienced progressive weight loss. An unfortunate side effect for patients using insulin is that once under control they tend to gain weight, there is no reason to believe this would change if the patients inhaled rather than injected the insulin.

On the surface it’s easy to understand why analysts are so high on the prospects for inhaled insulin. As is the case with so many diabetes related drugs the devil is in the details. Until there are substantial improvements in patient education insulin therapy will be considered a therapy of last resort. Then and only then will this high level of interest in inhaled insulin be justified.

David Kliff
Diabetic Investor
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