Intarcia's diabetes-treating implant tops Januvia in a head-to-head test

Intarcia CEO Kurt Graves

Intarcia Therapeutics' matchstick-sized device for diabetes beat out Merck's ($MRK) blockbuster drug Januvia in a Phase III trial, burnishing its case for FDA approval next year.

The treatment, ITCA 650, is an under-the-skin implant that metes out exenatide, a Type 2 diabetes drug marketed by AstraZeneca ($AZN) as Bydureon and Byetta. In a year-long Phase III trial involving 535 patients, Intarcia's therapy met all of its primary and secondary goals, besting Januvia at reducing blood sugar and lowering body weight, the company said. Intarcia is disclosing only top-line results for now, saving full data for a future medical meeting.

The Phase III success follows two positive late-stage trials for ITCA 650, and Intarcia is on track to file the drug-device combo for FDA approval in 2016. The latest victory triggers a $100 million milestone payment for the privately held company, which signed an equity deal with some unnamed investors earlier this year to exchange a cut of ITCA 650's future revenue for up to $300 million in cash.

The Boston-headquartered Intarcia believes its lead therapy is poised to disrupt the market for Type 2 diabetes treatments, contending with injectable therapies like Novo Nordisk's ($NVO) blockbuster Victoza. Like that drug, ITCA 650 is a GLP-1 agonist, designed to promote the body's natural production of insulin. But unlike the daily or weekly GLP-1 treatments now on the market, Intarcia's product requires only a once-a-year implantation, which the company touts as a potential solution to the patient-compliance issues that have long bedeviled diabetes therapies.

"The comparative results on all study endpoints for ITCA 650 vs. Januvia were unambiguous and compelling, particularly in light of how widely Januvia was prescribed worldwide last year, with global sales of more than $6 billion," Intarcia CEO Kurt Graves said in a statement. "... The prospect of bringing a totally new therapeutic approach to the market that has shown a potential to reduce both HbA1c, by a mean 1.5%, and reduce weight, by a mean 4 kg, in the population studied is remarkable."

Intarcia has to this point eschewed tradition in biotech, choosing not to go public and raising about $1 billion from private investors in lieu of a major partnership. The company has a deal with French drugmaker Servier to handle marketing outside the U.S. but has otherwise kept the rights to ITCA 650 to itself.

In its prior Phase III trials, Intarcia's device met its primary endpoints of significantly beating out placebo in reducing blood sugar and cleared secondary goals of weight loss and percentage of patients who reached their goal glucose levels. The treatment has thus far charted no major safety concerns, Intarcia said, and the company is working through a fourth late-stage study on 4,000 patients designed to study ITCA 650's long-term effects on cardiovascular outcomes.

- read the statement