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Eli Lilly & Co
GlaxoSmithKline Plc (GSK) will reveal detailed results today on an experimental treatment for diabetes that’s part of the reason for a $2.6 billion hostile takeover bid for Human Genome Sciences Inc. (HGSI), its partner on the drug.
Glaxo will present data from two of eight late-stage studies, dubbed Harmony 6 and Harmony 7, of the once-weekly drug albiglutide ahead of the American Diabetes Association’s annual meeting next month. Abstracts of those studies will be posted on the ADA website today.
Albiglutide, along with the lupus treatment Benlysta and darapladib for heart disease, form a trio of drugs Glaxo has developed with Human Genome. If approved, the product would compete with existing medicines from Amylin Pharmaceuticals Inc. (AMLN) and Novo Nordisk A/S (NOVOB), as well as other late-stage experimental drugs being developed by Sanofi and Eli Lilly & Co. (LLY), said Ying Huang, a Barclays Capital Inc. analyst in New York.
“Albiglutide will most likely be a niche product in this crowded market,” Huang said in an interview. Results from studies have so far added up to “a mixed bag,” and peak sales may be less than $500 million in 2020, he said.
The product would compete with Amylin’s Bydureon, approved in the U.S. in January and currently the only once-weekly treatment for Type 2 diabetes on the market. Amylin, like Human Genome, has lured suitors for a takeover, including Pfizer Inc., AstraZeneca Plc and Merck & Co., people familiar with the matter said this month.
Albiglutide may be able to stand out with a lower rate of nausea and other side effects, and a smaller needle than the one for Amylin’s Bydureon, said Gbola Amusa, a UBS AG analyst in London.
“Glaxo’s drug is reasonably likely to partake in a very big and dynamic market,” Amusa said in an interview. “So even if it is a later entrant, it’s still one that can do quite well.” He estimates sales may reach 453 million pounds ($712 million) in 2018.
About 552 million people, or one in 10 adults, may have diabetes by 2030, compared with about 366 million now, if nothing is done to curb the epidemic, the International Diabetes Federation said in a report in November. As many as 183 million people have the disease and don’t know it, the Brussels-based federation said.
Albiglutide is a form of a hormone called GLP-1 that stimulates the pancreas to produce more insulin, which diabetics need to keep blood-sugar levels under control. Novo Nordisk is the world’s biggest insulin maker, and its once-daily GLP-1 drug, Victoza, had sales of 5.99 billion kroner ($1 billion) last year.
In November, Glaxo released some data from Harmony 7 that showed it failed to help diabetics control their blood-sugar levels as well as Victoza. That result may not hurt its chances of regulatory clearance because Bydureon was approved even after failing to show better efficacy than Victoza, Huang said.
The Harmony 6 trial compared albiglutide with Eli Lilly’s Humalog in patients who also took Sanofi (SAN)’s Lantus. Patients using albiglutide had a 0.82 percent reduction in blood sugar, compared with a 0.66 percent drop in the Humalog group, Glaxo said in April.
In the abstracts to be released today and the presentation at the June diabetes meeting, more detailed results on side effects and efficacy from both studies will be presented, according to the company.
Harmony 8 will be completed within months, and the other five studies will be finished early next year, Glaxo has said. The data received so far on those trials are confidential and will be used for regulatory filings, the company said last month.
Glaxo is aiming to rebuild its diabetes business after its Avandia drug was withdrawn from the market in Europe in 2010 and sales were limited in the U.S. because of an increased risk of heart attacks. Avandia was once the best-selling diabetes pill with $3 billion in annual revenue.
Study results on albiglutide are unlikely to affect the outcome of Glaxo’s hostile takeover bid for Human Genome, Huang said. Investors are more focused on the heart-disease drug darapladib, which would enter a market that has been dominated by Bristol-Myers Squibb Co.’s Plavix, he said. That drug, which lost patent protection on May 17, had $7.09 billion in sales last year.
The first late-stage study on darapladib will conclude next year and the other in 2014, according to Glaxo.
Last week, Human Genome said it entered into confidentiality agreements with several pharmaceutical and biotechnology companies other than Glaxo about a “potential transaction.”
Glaxo this week amended the conditions of its offer to account for measures the U.S. company adopted to avoid a hostile takeover. The $13-a-share bid and June 7 expiration date remain unchanged, Glaxo said.
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