This could be a game changer

This could be a game changer

This morning Novo Nordisk (NYSE:NVO) announced they were moving their once-daily oral version of semaglutide into phase 3 trials. According to a company issued press release;

“Novo Nordisk today announced the decision to initiate a phase 3a programme with oral semaglutide; a once-daily oral formulation of the long-acting GLP-1 analogue semaglutide. The decision follows the encouraging results of the proof-of-concept phase 2 trial announced on 20 February 2015 and the subsequent consultations with regulatory authorities.

Novo Nordisk intends to initiate a global phase 3a programme, named PIONEER, comprising seven trials with approximately 8,000 people with type 2 diabetes. The PIONEER programme will include six safety and efficacy trials and one trial for evaluating the cardio-vascular safety of oral semaglutide. The first trial in the programme is planned for initiation in first quarter of 2016 and will investigate the efficacy and safety of once-daily oral semaglutide doses of 3 mg, 7 mg and 14 mg, compared to once-daily oral anti-diabetic sitagliptin dose of 100 mg. The remaining six trials of the PIONEER programme are all expected to be initiated during 2016.

In order to meet capacity requirements for current and future diabetes care products, including oral semaglutide, Novo Nordisk expects to invest an estimated 2 billion US dollars over the coming five years in two new production facilities; a new production facility for a range of active pharmaceutical ingredients in Clayton, North Carolina, US and a new drug-product facility in Måløv, Denmark. The final design and cost of the new production facilities will be presented for approval by the company’s board of directors in 2016.”

Diabetic Investor sees this news as significant as an oral semaglutide if approved could be a game changer. As regular readers know Diabetic Investor has long been a fan of GLP-1’s. GLP-1 therapy has many benefits – solid control, low incidence of hypoglycemia, weight loss and preset dosing – the main issue with the therapy has been up until now GLP-1’s had to be injected. First came Byetta which was injected twice per day, then cam Victoza which is injected just once a day and now we have three GLP-1’s which are injected just once-weekly.

Over the past few years the GLP-1 market has been one of the few bright spots as usage has steadily increased. Physicians are now comfortable with the drug and see it as a solid alternative to putting patients on insulin therapy. Unlike insulin which requires additional patient education and frequent monitoring of glucose levels, GLP-1 therapy is ultra-simple – dial out a preset dose and inject. That’s it.

Still given the love affair patients and physicians have for pills GLP-1 therapy up until now seemed to have limited growth potential. Should these trials prove successful this drug could be a game changer, one that is actually worthy of premium reimbursement. Even better should Novo follow the same path they did for Victoza, this oral GLP-1 could also be positioned as a treatment for obesity. Talk about expanding the market.

Perhaps this is the reason the company is investing $2 billion to expand production capacity. Novo clearly knows the potential an oral GLP-1 has in the market, especially if it outperforms Januvia which we believe it will. Remember Januvia is a $6 billion plus franchise.

It isn’t often that game changing drugs come along but this one has that type of potential.