Novo Nordisk (NVO) recently announced data from a late stage trial evaluating its candidate, Degludec, an ultra long-acting basal insulin, in patients with type II diabetes. Data from the study revealed that Degludec can lead to reductions in blood glucose levels even if its dosing is delayed. Degludec can be given once daily upto 40 hours apart. Degludec led to reductions in HbA1c (a measure of blood glucose) at 26 weeks by 1.28 percentage points to 7.2% versus Sanofi Aventis’ (SNY) Lantus. Fasting plasma glucose levels were also lower for Degludec compared to Lantus.
Another important insulin analogue that Novo Nordisk is evaluating is DegludecPlus, which is a fixed ratio combination of Degludec and NovoRapid, another insulin analogue marketed by the company. Degludec and DegludecPlus are next-generation insulin analogues.
Novo Nordisk has completed a large late stage clinical program with Degludec and DegludecPlus consisting of 17 separate trials. The program included 12 trials under the BEGIN program (Degludec) and 5 under the BOOST program (DegludecPlus). Data from the trials, which studied more than 10,000 type I and type II diabetes patients, confirmed the safety, efficacy and convenience of both candidates. Late stage data showed that these insulins led to non-inferiority in control of the rate of glycemia with a reduced risk of hypoglycemia. Degludec particularly reduced nocturnal hypoglycemia (night-time episodes of excessively low blood sugar) when compared with the most frequently used insulin analogs. Nocturnal hypos are a condition highly feared by diabetics, and a drug that reduces such symptoms present a real commercial edge for the company.
The company expects to file applications for marketing authorization of Degludec and DegludecPlus in both the US and European Union later this year.
Our Recommendation
So far we are impressed by Novo Nordisk’s biggest drug Victoza’s performance. Victoza is doing well both in the US and Europe. Moreover, we believe that the next-generation insulin analogues, Degludec and DegludecPlus, also hold significant potential for long-term growth at Novo Nordisk. Though we are encouraged by data from Degludec trials, we prefer to remain on the sidelines until we get more visibility on the approvability of Degludec and DegludecPlus. We currently have a Neutral recommendation on Novo Nordisk on a long-term basis. The stock carries a #3 Rank (short-term “Hold” recommendation).
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