Sanofi has dominated the insulin market since it introduced long-acting Lantus in 2000, capturing about 80% of the market share with $4.9 billion in sales in 2011. Novo Nordisk AS, a major player in diabetes, launched the basal insulin Levemir (insulin detemir [rDNA]) in 2005, but the drug failed to gain significant traction against Lantus, garnering about $1.3 billion in 2011 sales.

Meanwhile, Eli Lilly & Co., a major player in the fast-acting or mealtime insulin market with its Humalog (insulin lispro) franchise, has yet to bring a long-acting insulin to market.

Long-acting insulin is used once daily to help stabilize patients’ blood glucose levels throughout the day in patients with a later stage of the disease; other forms of insulin are used at mealtime for further glucose control. Insulin remains the largest part of the diabetes market and it is expected to grow as more patients develop the disease. Within insulin, Lantus has dominated the basal market, but now, both Novo and Lilly are aiming to bring new long-acting insulins to the market, which they hope will capture significant share from Lantus due to their potential benefits over the incumbent therapy Also see "Insulin The Focus At ADA 2012, But Don’t Forget GLP-1s And SGLT-2s" - Pink Sheet, 7 June, 2012..

Lilly Aims To End The Duopoly On Long-Acting Insulin

Although it is a latecomer to long-acting insulin, Lilly “intends to leverage our considerable manufacturing capacity, as well as our device capabilities, to deliver a very competitive product,” said the company’s head of diabetes, Enrique Conterno, who assumed the role in September 2009 from his previous post as the head of Lilly U.S., during a recent interview.

Lilly’s insulin analogue is in Phase III development, with four of its late-stage trials comparing it to Lantus in types 1 and 2 diabetics. At the American Diabetes Association meeting in Philadelphia June 8-12, Lilly presented Phase II study results which showed the novel insulin, LY2605541, improved glycemic control over Lantus in patients with type 1 diabetes and offered comparable glycemic control in patients with type 2 diabetes who make up the majority of diabetes patients.

LY2605541 could have a weight loss benefit over Lantus. Most insulins cause patients to gain weight, which could lead to further health complications. Patients on LY2605541 showed modest weight loss – a mean loss of about 2.6 lbs compared to a slight weight gain of 1.5 lbs. for patients taking Lantus. The drug also provided more glucose stability throughout the day than patients taking Lantus.

As the Phase III results of LY2605541 are rolled out, people will be watching the effects of the drug on liver function and triglycerides, as well as any further data on weight loss, to determine if the drug could truly offer competition to Lantus.

“The only way to create innovative products in this space is to have true clinical differentiation,” said Conterno. The company is banking on LY2605541’s slightly differentiated profile from Lantus as a means of gaining traction in the market. Analysts are not sure that the differences will be enough to dethrone the market leader, but LY2605541 could pose challenges to Novo’s latest insulin offering, degludec, which is currently awaiting approval from FDA.

“Lilly's LY2605541 adds an additional potential new competitor for Lantus; how it stacks up in terms of improvement remains to be seen, although we expect it would take share of new patients rather than switches," wrote Barclays analyst Charles Butler in a June 11 note. “Entry of Lilly into the basal insulin analogue market for the first time would end the effective duopoly of Novo and Sanofi and could pose risks to our forecasts for insulin degludec”

Novo Aims To Bring A Competitive Insulin To Market

For both Lilly and Novo’s insulins, the benefits so far appear to be small. Many analysts speculate that both drugs will only be used in patients that are having trouble on Lantus or are new insulin patients, potentially a large market.

Novo filed for FDA approval of the ultra-long-acting degludec in September 2011 and was informed recently by FDA that a July PDUFA date would be pushed back three months to Oct. 29 to give the agency extra time to review the large amount of data in the submission package Also see "More Insulin Innovation To Come, Says Novo CEO Sorensen" - Pink Sheet, 14 December, 2011..

In December, Novo highlighted the results of its Phase III program for degludec and degludecPlus, a combination of degludec and Novo’s rapid-acting insulin aspart. A 52-week trial comparing degludec to Lantus showed non-inferiority in terms of the extent to which blood glucose was lowered among more than 1,000 type 2 diabetes patients. Crucially for Novo, the study also showed a statistically significant reduction in the number of hypoglycemic events among the degludec group – particularly those events that happened during the night – something that can occur with Lantus if the dose is not adequately controlled. Patients in the degludec group experienced 25% fewer nocturnal hypoglycemic events than those in the Lantus arm Also see "Novo Highlights Degludec's Advantage Versus Lantus In Fewer Night-Time Hypoglycemic Events" - Pink Sheet, 30 December, 2010..

A meta-analysis presented at ADA of hypoglycemic incidence comparing degludec to Lantus showed that type 2 patients treated for one year with degludec compared with Lantus as part of a basal-bolus regimen had 3.26 fewer hypoglycemic events per year, of which 0.7 were at night.

Night-time episodes of hypoglycemia are often unpredictable and can cause seizures and even death.

“However, one could argue that basal insulin muddies the waters in looking at hypoglycemia and that a more relevant comparison might be of basal-only treatment in type 2 patients with earlier disease,” wrote Butler. “That analysis shows that degludec saves 0.5 hypoglycemic events per year of which 0.2 are nocturnal. These do not seem like massive differences to us, although real-world hypoglycemic events probably occur more frequently than in these studies and we recognize degludec offers other benefits, such as flexible dosing.”

ORIGIN Quiets Cancer Fears

Meanwhile, Sanofi’s ORIGIN study, which tested Lantus in patients with cardiovascular risks against standard-of-care in 12,000 patients over six years, captured attention at ADA. The study was designed to see if the basal insulin could improve CV health and thus be used earlier in the patient continuum. While most analysts and investors did not expect the drug to reach the primary endpoint of improving CV health, expectations were still high.

Since ORIGIN was such a long study, people were watching for safety issues – something that could cripple the Lantus franchise and give competitors a way in. ORIGIN showed no signs that Lantus increases the risk of cancer; a concern that came up in 2009 when a retrospective analysis unearthed a potential link to breast and bladder cancer Also see "Sanofi Counts FDA As New Supporter In Lantus Cancer Scare" - Pink Sheet, 1 July, 2009..

“The complete absence of any increase in malignancy in patients taking Lantus is comforting since insulin will continue to be a cornerstone of treatment,” wrote Leerink Swann analyst Seamus Fernandez in a June 12 note. “ORIGIN likely proved that early use of insulin has no impact on cardiovascular outcomes but the lack of any difference in microvascular outcomes was no surprise.”

Now that physicians and patients can be more confident in the safety of Lantus, Sanofi is taking steps to further maintain the drug’s position as “a gold standard,” said Dennis Urbaniak, the head of the diabetes unit at Sanofi U.S.

One part of that strategy is integrally linked with Sanofi’s once-daily GLP-1 product, Lyxumia (lixisenatide), which is currently in late-stage testing Also see "Diabetes Leaders Lilly, Sanofi Give A Glimpse Of GLP-1 Strategy" - Pink Sheet, 14 June, 2012.. The company plans to file for approval in the U.S. in the fourth quarter. Once Lyxumia has been approved, Sanofi plans to seek approval for a fixed-dose combination of Lantus and Lyxumia. It believes the convenience of both drugs in a single injection will be enough to win market share.

Sanofi has already presented data that shows the duo decreased hemoglobin A1c levels compared to Lantus and metformin alone. In the GetGoal Duo 1 study that was presented at the ADA meeting, patients who were naïve to insulin treatment were given a 12-week run of Lantus that was titrated to reach a target fasting plasma glucose of 80-100 mg/dL. After the 12 weeks, patients with a hemoglobin A1c greater than 7% – about 50% of the patients in the study – received either once-daily Lyxumia or placebo for 24 weeks while metformin and Lantus titration were continued. HbA1c decreased on average from 8.6% to 7.6% during the run-in period with Lantus, and the addition of Lyxumia led to a further HbA1c decrease to a mean value of 6.96% after 24 weeks compared to 7.3% in patients receiving placebo.

The GetGoal Duo combination will allow Sanofi to move the product to the millions of patients already taking Lantus, thus providing it a built-in market.

“[Lyxumia] offers utility when added to insulin therapy, hence the rationale for development of a Lyxumia/Lantus combination product. Sanofi’s marketing strength in diabetes and the likelihood that it will target Lyxumia at the 4 million patients with type 2 diabetes being treated with Lantus could set the scene for sales success and preservation of the Lantus franchise,” wrote Butler in a note.

Yet, Sanofi isn’t the only company trying to bank on a combination product to maintain one market while growing the market for another product. Novo is currently developing a combination product that links its market-leading glucagon-like peptide-1 agonist Victoza (liraglutide) with degludec. The combo product’s Phase III program is expected to wrap up before the end of the year.

While Lantus has competitors coming from all sides, the drug that has the biggest potential to create competition for Lantus is Lilly’s late-stage insulin glargine, which has the same active ingredient as Lantus. While the company is reluctant to categorize this offering as a biosimilar because the regulatory path, particularly in the U.S., remains so uncertain, that is essentially what it is.

Lilly is likely the only insulin manufacturer to pursue a biosimilar. Sanofi has said it will not go that route, and other companies such as Pfizer Inc. have backed off due to the minimal return on investment versus the high costs of development and manufacturing. For Lilly, those costs will not be that high since the company already has the infrastructure in place, both from a manufacturing perspective and commercially, to bring the product to market. The company also claims that it has the devices needed to pair with a biosimilar insulin glargine.

Lilly’s partnership with Boehringer Ingelheim, which it forged in January 2011, gives it additional firepower in the diabetes market overall. BI is not currently a strong player in diabetes, but as part of the deal, Lilly got access to two of the German company’s late-stage programs: the now-marketed dipeptidyl peptidase-4 (DPP-4) inhibitor Tradjenta (linagliptin), and the sodium glucose co-transporter 2 (SGLT-2) inhibitor empagliflozin, which will likely be filed for U.S. regulatory approval in 2013. In addition, Lilly had its long-standing, successful franchise in fast-acting insulin Humalog and Humalin. It also currently markets AmylinInc.’s GLP-1 drugs Byetta (exenatide) and its long-acting formulation Bydureon outside of the U.S. – at least until Amylin finds a new partner or 2013 (whichever comes first).

Yet analysts wonder how the company plans to pull off positioning both a biosimilar insulin and a novel basal insulin in the same market at virtually the same time – likely 2013. Conterno expects that Lantus will retain a third of the global market, while a biosimilar could grab another third and he predicts that next-generation insulin will capture the remainder of the global market.

“With our clinical profile that we would expect [for LY2605541], we believe that our innovative basal insulin will have a premium over Lantus,” said Conterno of the market dynamics. “And as we look at how we expect the market to behave, we do see this next-generation insulin, in this particular case, to have an important uptake, but we do expect that glargine in general will be very significant still. And as we think about glargine, we do believe that there is an opportunity for us in particular to participate in that particular segment.”

Conterno would not elaborate further on how the company plans to position the two drugs or how the sales force would split its focus between the two products. Analysts assume that LY2605541 will be able to command a higher price tag, while the biosimilar insulin will have a lower price tag and be more commercially viable in other parts of the globe.

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