Zacks -- Recently, Novo Nordisk (NYSE: NVO - News) reported solid top-line results from three phase III studies of Degludec and two studies of DegludecPlus. Degludec significantly reduced the risk of hypoglycaemia during the night compared to Sanofi Aventis’ (NYSE: SNY - News) Lantus in two long-term studies.
Degludec (also known as NN 1250) and DegludecPlus (also known as NN 5401) are next-generation insulin analogues. Degludec is an ultra long-acting basal insulin, and DegludecPlus is a fixed ratio combination of Degludec and NovoRapid. Degludec is being investigated in both type I and type II diabetes, whereas DegludecPlus is being investigated in type II diabetes alone.
Novo is conducting a large phase IIIa clinical program with Degludec and DegludecPlus consisting of 17 separate trials. The program includes 12 trials under the BEGIN program (Degludec) and 5 under the BOOST program (DegludecPlus).
Degludec Results
The first 52 week phase IIIa trial of Degludec compared Degludec to Sanofi Aventis’ best-selling long-acting insulin Lantus, both in combination with NovoRapid in type II diabetes patients. The second 52-week phase IIIa compared the same drugs in type I diabetes patients.
Both the trials showed that Degludec improved long-term glycaemic control and demonstrated equal efficacy to Lantus in controlling glucose. Most importantly, Degludec lowered the risk of nocturnal hypoglycaemia (night-time episodes of excessively low blood sugar) by 25% and 24%, in the first and second trials respectively, compared to Lantus.
Nocturnal hypoglycaemia is more severe than daytime hypoglycaemia. Patients and doctors want to avoid nocturnal hypoglycaemia as it is very difficult to treat. Hence, we believe these results could help Novo gain a higher price for Degludec than Lantus. In the first study Degludec showed a lower risk of overall hypoglycaemia versus Lantus.
The third trial was conducted on insulin naïve type II diabetes subjects, comparing Degludec to Januvia. The trial showed superiority over Januvia on glucose control. The overall hypoglycemia rate in the study was low and Degludec did not show any significant difference in the rate of nocturnal hypoglycaemia.
DegludecPlus results
In the DegludecPlus studies, DegludecPlus was compared to Lantus in type II diabetes patients. DegludecPlus led to better glucose control versus Lantus. Overall hypoglycaemia for DegludecPlus was statistically significantly higher versus Lantus. Nocturnal hypoglycaemia was lower in both studies, only reaching statistical significance, in one study.
All the trials confirmed the good safety and general tolerability of Degludec and DegludecPlus.
On the third quarter conference call, data from the first phase IIIa study on Degludec, and the first two phase IIIa studies on DegludecPlus was presented. The Degludec study demonstrated that Degludec flexible dosing (given at 8 to 40 hour intervals) gives equivalent efficacy to fixed Lantus dosing. DegludecPlus showed improvement in long-term glycemic control and reduction in hypoglycemic events in comparision to NovoMix 30.
Novo expects to present data from the remaining Degludec and DegludecPlus studies in conjunction with the full year results on Feb 2, 2011. Novo expects to be able to file for both products in both the EU and the US by the end of 2011, followed by their potential launch in 2013.
Our Recommendation
We currently have a Neutral recommendation on Novo Nordisk. We are encouraged by Victoza’s strong performance in the third quarter and expect the drug to contribute significantly to sales going forward. Moreover, Degludec and DegludecPlus are also important for long term growth at Novo and the positive data increases our confidence in the approvability of the drugs.
We, however, prefer to remain on the sidelines until data from the remaining trials of Degludec and DegludecPlus are released. We are also concerned about the potential longer term risk from the launch of biosimilars in 2015. Hence, we are Neutral on the stock in the long term.
