The Novo Delusion

The Novo Delusion

Listening to the comments made by Novo Nordisk (NYSE:NVO) during their conference call on the Victoza® approval one has to admire their tenacity. Approved with a black box warning, Diabetic Investor sees Victoza facing an uphill battle in the US market. Yet when you listen to the company one just might get the impression that a black box warning is no big deal and is almost commonplace. While Diabetic Investor strongly disagrees with this sentiment, it does show the lengths the company will go to promote Victoza.

As Diabetic Investor has been predicting facing the approval of the once-a-week version of Byetta in early March, the company is doing their best to muddy the GLP-1 waters. As they did when the thyroid cancer issue first came to light during the now famous FDA panel meeting, Novo is claiming that this issue is a class effect for all GLP-1’s and that issue only presents itself in rodents and not in humans. The company also noted that a “major paper” is set to be published that will back up this claim.

Diabetic Investor recommends that subscribers review the archives section of the our web site as we have written extensively as to why Novo’s claims that the thyroid cancer issue are a GLP-1 class effect are dubious at best. Once again Novo is playing fast and loose with statements made by the FDA as well as the data submitted to the FDA by Amylin (NASDAQ:AMLN).

What’s truly remarkable is the company’s statement that Victoza will reach blockbuster status in the US within 5 years. This statement is even more remarkable as they noted there will be no increase in their US sale force and that Victoza would be priced at the same level as Byetta, approximately $8 per day. Add in the fact the company noted they plan to position Victoza as an add-on therapy with patients already on metformin and it makes one wonder what these guys are smoking.

Even without the black box warning Victoza faced a difficult comparison with Byetta LAR, as we have noted on several occasion when the data is placed by side by side for both drugs, LAR is the clear winner. Both drugs do a solid job promoting glucose control and weight loss. Both drugs are fixed dosed products that don’t require patients to monitor their glucose levels. Both products are delivered via injection. The major difference is dosing frequency – Victoza once a day and LAR just once a week.

While Novo and Amylin will squabble over each other’s claims in the real world less frequent administration trumps more frequent administration every time, especially with drugs that are delivered by injection.

The fact that Victoza will carry the dreaded black box warning from day one only makes the situation more difficult. The company can talk all they want about the thyroid cancer issue being a class effect or that other drugs carry black box warnings but they cannot hide from the fact that the current version does not carry a black box warning and the only real class effect we have seen with GLP-1 therapy is pancreatitis.

As Diabetic Investor mentioned yesterday the FDA specifically noted the pancreatitis issue with Victoza in their press release while Novo to no one’s surprise didn’t even acknowledge this fact.  

Looking over their GLP-1 choices physicians will soon have three choices Byetta, injected twice daily, Victoza injected once daily and Byetta LAR injected once a week. Byetta LAR has the additional advantage of history as the current version of Byetta is being used by over a million patients and its safety profile is well understood.

Compare that Victoza which comes to market not just with pancreatitis concerns but with the additional issue of thyroid cancer.  While Diabetic Investor has never considered the pancreatitis issue to be a blessing, it’s well known that patients with diabetes are at greater risk for developing pancreatitis. Amylin has also shown that the incidence rate of pancreatitis and Byetta users is actually lower than incidence rates for patients using other therapy regimens. While the FDA noted; “In five clinical trials involving more than 3,900 people, pancreatitis occurred more often in patients who took Victoza than in patients taking other diabetes medicines.” (Highlighting added by Diabetic Investor.) This statement appears to indicate that pancreatitis is of a greater concern to Victoza patients than Byetta patients.

Throw in the black box warning on thyroid cancer and Victoza looks less and less appealing to the people who will actually be prescribing the drug. Do they take a chance on a relatively unknown drug that appears to have an uncertain safety profile or do they go with a well known drug? The company might have been able to overcome some physician reluctance had they priced Victoza as a cheaper alternative to Byetta but priced on par with Byetta physicians have few, if any, incentives to prescribe Victoza, a situation that will get worse when Byetta LAR gets here in a few short weeks.

The reality here is Novo is doing their best to put a good face on a bad situation. Rather than acknowledge the many hurdles Victoza will face in the marketplace, the company continues to drink the kool aid. The fact that they would publicly state that Victoza will achieve blockbuster status shows how delusional management has become.  This was a possibility had the drug been approved well before Byetta LAR, but when the entire situation is looked at realistically; Victoza has more questions than answers.

At one time Diabetic Investor expected the GLP-1 market to be a battle between two diabetes heavyweights, Novo and Lilly (NYSE:LLY), Amylin’s partner with the Byetta line. Based on all available evidence this is looking less like a prize fight and more like a beat down. The folks in Indianapolis are having a pretty good week, the Colts are in the Superbowl and Byetta LAR is looking like a winner as well. When this is all said and done Diabetic Investor believes the Colts will have a more difficult task beating the Saints than Byetta LAR will have against Victoza. And the Superbowl is looking like a much better game too at least it will be competitive.