The New Holy Grail

The New Holy Grail

Several years ago Diabetic Investor noted the search for a truly non-invasive glucose monitor was the “Holy Grail” of diabetes. Everyone assumed the reason patients did not regularly monitor their glucose levels was directly related to the “pain” associated with performing a glucose test. The conventional logic was if anyone successfully developed a non-invasive monitor patients would immediately begin checking their glucose levels regularly. Millions of venture money was spent chasing this idea, as the betting line assumed there would be a huge payoff. Needless to say today we have no non-invasive monitor and recent advancements in technology has largely disproved this notion that patients do not test because of the “pain” associated with performing a test. Patients do not test regularly because they have no idea what the test results mean and for the majority of patients there is no action step performed based on the results of the test.

Next came the quest for alternate delivery of insulin, which to a great extent centered around inhaled insulin. Once again millions was spent in the development and commercialization of inhaled insulin. Here too, the conventional wisdom was that the reason more patients did not use insulin was due to the “pain” associated with insulin delivery. Never mind that insulin therapy is more complex than just how the insulin is delivered or that physicians and patients view insulin therapy as a therapy of last resort. Or that use of insulin requires an educated patient. Just as with non-invasive glucose monitor several large companies bought into the conventional wisdom only to experience disaster. The Exubera debacle not only cost Pfizer (NYSE:PFE) billions but proved once again conventional wisdom wrong.

This brings us to the latest conventional belief that if anyone could develop an oral form of GLP-1 they stand to reap billions. As Diabetic Investor has been reporting since the ADA conference GLP-1 therapy is set to become the dominate treatment option for type 2 diabetes. Byetta form Amylin (NASDAQ:AMLN), currently the only FDA approved GLP-1, is delivered via twice daily injections. Liraglutide from Novo Nordisk (MYSE:NVO), currently awaiting FDA approval, is a once-daily injection. Amylin and Roche have long-acting versions under development that are injected just once-a-week.

While everyone is finally beginning to see the value of GLP-1 therapy and the mega potential for once-weekly formulations there’s still a belief that an oral formulation of GLP-1 has even greater market potential. This belief is centered around Byetta LAR which will be delivered using a 25 or 27 gauge needle. Although this needle size is larger than then conventional insulin needles it is not the harpoon everyone believes it to be. It’s also known that this is not the final needle size for Byetta LAR. Still the conventional wisdom is that given the choice patients and physicians would prefer a pill.

Diabetic Investor does not necessarily disagree with this theory. However, we do not see the fact that Byetta LAR has to be injected using a larger size needle as a threat to success. The success of Lantus from Sanofi-Aventis (NYSE:SNY) is proof. Lantus became the world’s best selling insulin because of use in type 2 patients. Physicians and patients understood the benefits of using Lantus in combination with short-acting insulin or other oral agents. Physicians correctly reasoned patients would not be adverse to once daily injections when the benefits were so clear.

This is the same reason physicians are anxious to see Byetta LAR come to market. Based on the available data Byetta LAR has the potential to change the paradigm for treating type 2 diabetes. Even with this growing body of evidence many are skeptical because of the perceived “pain” factor.

Falling into this trap is Novo Nordisk who recently signed a deal with Emisphere Technologies (NASDAQ:EMIS) to develop an oral formulation of their GLP-1. A deal which could net Emisphere nearly $90 million. From our perspective here at Diabetic Investor, Novo is throwing good money into a bad deal. Granted the company can easily afford to make a mistake, just as they did with their attempt at inhaled insulin, the question is why make the deal at all.

Given Emisphere’s checkered history the deal is even more suspect. For those with short memories, this is the same company who once claimed they could deliver insulin orally. Only to later discover that oral delivery of insulin isn’t that easy and what they had didn’t work. Under new management the company is now jumping on the GLP-1 bandwagon.

Yet the Novo Emisphere deal is just the beginning as others will surly follow. Just as millions, more realistically billions, was wasted on non-invasive glucose monitoring and inhaled insulin, more money will be wasted trying to develop an oral GLP-1. Companies will claim this money isn’t being wasted just as they did with non-invasive and inhaled. They will claim that success will lead to untold riches. As day follows night the Street will buy into this conventional wisdom, just as they did with non-invasive and inhaled. Ignoring the realities that while an oral GLP-1 would be a nice thing to have, not being delivered orally will not stop the GLP-1 juggernaut.

One would think companies and the Street would learn from past mistakes. At minimum at least not get so giddy over a very difficult task. That just once, they would proceed cautiously and not throw good money into unproven technology. It’s not like an oral GLP-1 will work any better or be safer.

This fascination with oral delivery of insulin or GLP-1 and the continued development work in non-invasive glucose monitoring reminds Diabetic Investor of something J.C. Hare and A.W. Hare, two noted British clerics, wrote back in 1827; “He must be a thorough fool, who can learn nothing from his own folly.”

David Kliff
Diabetic Investor
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