Sanofi ($SNY) has peeled back the cover on another chapter of Phase III data for U300, advancing its case that its next-gen diabetes therapy can be safer and just as effective as its blockbuster Lantus as it sets the stage for a regulatory pitch next year. But analysts may be left wondering if the long-acting insulin can successfully beat back rivals with a better set of data.
The headline Sanofi was looking for today centers on a 23% drop in the number of patients suffering from low blood sugar--hypoglycemia--when compared to the Lantus arm. A slate of late-stage studies also demonstrated a similar drop in in HbA1c over 6 months, leaving the company with a solid claim for non-inferiority that will be needed to protect the critical $6.5 billion franchise carved out by Lantus, which loses patent protection in 2015. But in one of the Phase III studies involving insulin-naïve patients U300 failed the primary endpoint on lowering incidents of hypoglycemia.
One miss in a slate of hits won't derail this program. But it might cause a few concerns after regulators at the FDA have set the bar on new diabetes treatments very high, as they demonstrated with the unexpected rejection of Novo Nordisk's ($NVO) Tresiba, a long-acting insulin similar in many respects to U300.
Tresiba posted a 36% reduction in hypoglycemia compared to Lantus in its late-stage studies, significantly better than U300. But evidence of cardiovascular risks persuaded the FDA to overlook a panel vote in its favor alongside a European approval and force Novo Nordisk to do a safety study ahead of a final approval, giving Sanofi the unexpected lead in reaching the market. And some analysts believe that even if Tresiba makes it to the market relatively quickly, Sanofi will still have a fighting chance in the U.S. as it goes head-to-head with an aggressive Novo Nordisk in Europe.
"The results confirm that U300 will likely be approvable," Deutsche Bank analyst Mark Clark wrote, according to a report in Reuters. "Those expecting hypoglycemia reductions to be comparable in magnitude to Novo's Tresiba may be disappointed, but this misses the point. U300 is a step forward on a well-established and trusted mainstay of modern diabetes treatment. While Tresiba has arguably a more ideal hypoglycemia profile, U300 will benefit from the 10 years of safety and physician experience gained with Lantus."
The news today could also have an impact on Eli Lilly, which is shepherding its own next-gen diabetes treatments in late-stage studies. Aside from some long shots or marginal performers, Lilly is betting big that it can compete with its own cutting-edge therapies, which are desperately needed to combat generic competition.
But there's a problem. While the diabetes market has been booming, the pharma giants competing for this market are likely going to wind up with more products that earn less than today's top blockbusters. Timothy Anderson at Bernstein has estimated sales of less than $500 million for U300 in 2020--a fraction of Sanofi's Lantus income. And the average projection on peak sales is well under a billion dollars.
Winning approvals is no guarantee of great success.