Although formulary position is more critical than face to face contact with a sales rep, whenever a company launches a new drug especially one that they are betting the ranch on it’s all hands-on deck. This is the situation Novo Nordisk is about to encounter when the FDA approves the oral version of semaglutide. Yes GLP-1 usage is increasing as physicians have embraced this therapy option. However as we have noted the oral version does carry with it a rather complex dosing regimen.
Given that Novo needs this drug to be a major hit you can take it to the bank they are going to be aggressive with payors. They cannot afford poor formulary position. We would anticipate Novo using a healthy dose of discounts and rebates to ensure favorable placement. Still given how important this drug is to the company it will be equally important that reps are all in with the drug as well that they are not competing against other products in the company’s portfolio.
Being the first orally administered GLP-1 will certainly create lots of interest but this just opens the door to the physician’s office it in no way ensure a prescription. Keep in mind that this isn’t the only therapy option for poorly controlled Type 2 patients, it’s one of many. The question becomes will physicians switch patients off injectable GLP-1’s or will they prescribe this as an add on option for patients not currently using a GLP-1?
While we hate to keep mentioning the dosing regimen it’s a certainty that Lilly reps will mention this every chance they get. They will note that while Trulicity is an injectable it’s only taken once a week and is widely covered by payors. Novo’s own reps will also have some choices to make. Should they promote the new drug what will this cannibalize sales of their once-weekly injectable? Novo is walking a treacherous tightrope as they want to incentivize sales of the new drug yet keep sales of the once weekly strong too.
Unlike the insulin market which has fully commoditized the GLP-1 market while proceeding down that path is still very profitable. However the introduction of the oral could spark a price war in the market as Lilly for sure will do whatever they can to protect Trulicity. This would force Novo into playing defense. Thanks to their comprehensive portfolio Lilly also can offer package deals, something Novo really can’t do.
Our experience tells us that the drug will as the first orally administered GLP-1 will get off to a strong start. However the real test will come with refills. Will the complex dosing regimen be too much for patients or will they adjust to the regimen? Our gut tells us this could be like a relationship that starts out hot and heavy only to fizzle out when the initial interest wears off. Novo needs this is to be a long-term romance not a one-night stand.
Time obviously will tell the story, but this is not the slam dunk many think it will be.