Novo Full Year Results
Based on the comments made today when Novo Nordisk (NYSE:NVO) reported their full year results it looks like another Diabetic Investor prediction has proved accurate. Given the issues facing the recently approved Victoza® the company is embarking on a two-fold marketing strategy. As predicted by Diabetic Investor the company continues their efforts to minimize the black box warning issued to Victoza. As has become their custom the company cited a study in Diabetes Care that they said indicated that the thyroid cancer issue is not applicable to humans.
Also as predicted the company is doing whatever they can to convince everyone that the thyroid cancer risk associated with Victoza is a class effect that is associated with all long-acting GLP-1 compounds. The company went as far to state they believed that others in this category will be approved with a similar black box warning. (Take that Amylin (NASDAQ:AMLN) and Lilly (NYSE:LLY).)
Given the market potential for Byetta LAR, whose PUDFA date is March 5th, it’s hardly surprising that Novo is pursuing a take no prisoner’s strategy to market Victoza. They understand all too well they have a very limited window of opportunity to market Victoza in US and that when LAR gets here head to head comparisons favor LAR.
Just in case there is anyone out there who’s buying into what Novo is selling Diabetic Investor suggests they visit the Victoza web site, www.victoza.com, and read the label for Victoza and the additional information provided for healthcare professionals. Then ask yourself this simple question- Why would any physician prescribe Victoza? Or put another way- What compelling advantage does Victoza offer over LAR?
The fact is Novo has become a master at parsing comments made by the FDA and now the study published in Diabetes Care to match the claims they are making. Simply put there is a small element of truth in what they are saying, so it would be inaccurate to say the company is telling an out and out lie. However, when one reads the entire statement made by the FDA or the study published in Diabetes Care it’s not a stretch to say the company is taking wide liberties with what’s been said or written.
According to the study published in Diabetes Care the authors write; “At the highest drug exposures, MTC was reported in 14% of male and 6% of female Sprague-Dawley rats, which was above the rates observed in untreated rat controls. C-cell lesions were also reported to be more common with liraglutide in CD-1 mice, albeit at much lower frequencies; no C-cell lesions were described in the cynomologous monkey. In contrast, once-daily administration of exenatide in rodents is associated with a high frequency of nodular C-cell lesions but no carcinomas were reported (36). In safety monitoring of multiple liraglutide clinical trials, many patients with undetectable calcitonin levels before initiation of investigational (liraglutide, placebo, or active comparator) therapy were found to have levels that rose into the mid-reference normal range; rare patients developed mild hypercalcitoninemia during therapy.” Highlighting added by Diabetic Investor.
Frankly there are more holes in this statement than there are in Swiss cheese. Never mind that exenatide is administered twice daily, but just how anyone can read this and believe this is a class effect is beyond Diabetic Investor. But there’s more the authors go onto to state; “According to the FDA briefing documents, no cases of C-cell lesions have been documented by histology in patients treated with exenatide. Several cases of papillary thyroid cancer have also been reported in the liraglutide clinical development program” Bold added by Diabetic Investor.
This one statement alone appears to contradict everything Novo is saying. Given that Byetta is has been on the market for nearly five years and is being used by over one million patients it seems to Diabetic Investor that real life experience trumps clinical work and in the real world according to the FDA there have been no cases of C-cell lesions with patients using Byetta.
What Diabetic Investor sees here is a company that is talking out of booth sides of their mouths. On the one hand they say the Thyroid cancer risk is no big deal. Yet at the same time they are trying to taint their competition with the exact same problem. As we have seen with Avandia and Actos, two drugs in the same class, just because one has a cardiovascular issue it does not automatically mean the other does too. Diabetic Investor finds just a slightly ironic that no one else developing a GLP-1 has seen this thyroid cancer issue.
At some point Novo is going to realize that when you play with fire that it’s not just the competition that gets burned. It seems as though the company hasn’t learned anything from the Lantus cancer situation. Here too, it’s ironic that company so well prepared when this issue came to light and tried to play both sides of the fence. On the one hand saying that long acting insulin’s are perfectly safe, while at the same time saying it just so happens our long acting insulin doesn’t have this issue.
The fact is Novo has no one but themselves to blame for the problems surrounding Victoza, problems they made worse by the way they handled the FDA panel meeting which started this whole mess. Instead of acknowledging the issues faced by Victoza and playing up some of the drugs strengths, needle size, no mixing, etc., the company has embarked on often used political strategy- When you have nothing concrete against your opponent play dirty.
There was a time, back in the day, when Diabetic Investor admired Novo Nordisk. Back then the company was a true leader in the diabetes field and didn’t need to play dirty. Seeing that their major competitor Lilly was asleep at the wheel, they kicked Lilly’s backside to become the leader in insulin sales here in the US. Then along comes Lantus from Sanofi-Aventis (NYSE:SNY) and all of sudden Novo wasn’t a player in growing insulin category. Lilly became reengaged and while they are not seriously hurting Novo’s market share advantage, at least they stopped the bleeding.
Amylin comes along with Byetta and they realize that GLP-1 therapy has the potential to change the treatment paradigm for type 2 diabetes, the largest and fastest growing segment of the diabetes market. They correctly anticipate this market could grow even faster with a more patient friendly GLP-1 and push Victoza development. Had everything gone as planned and Victoza been approved when they originally thought it would be, the drug had a better than 50/50 chance of establishing itself in the marketplace. As so often happens, things didn’t go as planned and now Novo is stuck with a tainted drug about to face major competition.
With millions invested and millions more at stake, the company has decided to play hardball using whatever means necessary to remain relevant, even if that means tainting an entire drug category with facts that are dubious at best.
Waiting in the wings are Amylin and Lilly and their promising once-weekly GLP-1 Byetta LAR. Although Lilly seem to have a Jekyll and Hyde attitude towards their relationship with Amylin, privately they would like nothing better than to kick Novo’s backside in the GLP-1 category. As the great philosopher Aristotle once wrote; “Revenge and punishment are different things. Punishment is inflicted for the sake of the person punished; revenge for that of the punisher, to satisfy his feelings.”
When it comes to the battle for supremacy in the GLP-1 market, Lilly and Amylin could end up quoting Edward Gibson who said; “Revenge is profitable, gratitude is expensive.”
