AstraZeneca ($AZN) and Bristol-Myers Squibb ($BMY) were stiff-armed by the FDA on their application for the SGLT2 diabetes drug dapagliflozin, but European regulators believe the benefits outweighed the risks that pushed the agency to reject the innovative therapy early this year.
The regulatory approval for dapagliflozin by the European Commission--which will soon hit the European market as Forxiga--clears the way for the first of several new sodium-glucose cotransporter 2 inhibitors, which spur the body to flush out glucose in urine, working independently of insulin. In the U.S., regulators and independent experts at the FDA turned thumbs down on dapagliflozin, demanding that the developers produce more data to prove that the cancer cases seen in drug studies didn't portend similar troubles if the drug is allowed to hit the huge and growing diabetes market.
This is good news for AstraZeneca, which has been struggling to overcome its reputation for one of the worst late-stage pipelines in the business. Bristol-Myers Squibb, which has had its own setbacks in the wake of a series of new drug approvals, has its own reasons to cheer the decision. The approval is also likely to raise the spirits of the development teams at Johnson & Johnson ($JNJ, developing canagliflozin), Pfizer ($PFE), a Lilly and Boehringer partnership, Lexicon and others which have their own SGLT2 inhibitors in development.
Analysts had projected peak sales of up to $700 million for dapagliflozin before the FDA handed out its complete response letter. But even with an approval from the European Commission, which came after regulators assessed and accepted the companies' risk management plans, a dark cloud is likely to remain over the drug's commercial prospects without a green light in the U.S.
The plan now is to head back to the FDA in mid-2013 with more data drawn from their drug studies.
"We are looking forward to getting approvals everywhere, and that includes with the FDA," Fred Fiedorek, cardiovascular head at Bristol-Myers, told Reuters.
"Diabetes is a progressive disease that requires a combination of treatment approaches over time," said Lamberto Andreotti, the CEO at Bristol-Myers Squibb. "Forxiga is the first of a new class of type 2 diabetes medication that works independently of insulin and represents a new treatment option for patients and physicians across Europe."
- here's the press release
- read the report from Reuters