Big Pharma companies continue to come to the realization that working together will make them stronger. In an effort to gain some headway in the crowded diabetes landscape, two pharma heavyweights are teaming up on a Phase III treatment for diabetes that will increase both companies’ presence in the market, but it will be a late entrant jockeying for position.

Merck & Co. Inc. and Pfizer Inc. announced April 29 that they will collaborate on the development and commercialization of ertugliflozin, a sodium glucose co-transporter 2 inhibitor (SGLT-2) that has been made Phase III-ready by Pfizer.

The companies – which are notorious for keeping the details of their collaborations under wraps – revealed that Merck has already paid $60 million to Pfizer in upfront and milestone payments. The total value of the deal was not disclosed, but Merck will be responsible for further payments to Pfizer. The N.J.-based pharma will pay a majority of the costs, but it will also garner the majority of the profits from worldwide sales (excluding Japan) in a 60%/40% split.

Neither company was willing to comment on the deal, but they did say that ertugliflozin will enter Phase III testing this year. Neither Merck nor Pfizer would divulge plans for Phase III trial design or plans for regulatory filings, but other entrants in the class have already completed Phase III. The drug has been studied in six Phase I and Phase II clinical trials so far with 680 patients randomized across the various trials. For the 12-week proof-of-concept trial, 328 patients were enrolled, of which 219 were exposed to either 1 mg, 5mg, 10mg, or 25mg of ertugliflozin – all patients were on a stable dose of metformin. The drug improved HbA1C (blood glucose levels) by -0.83% from baseline compared with -0.11% for those on placebo. Patients on the drug also saw an improvement in body weight of 2.9kg.

Ertugliflozin will also be developed in fixed-dose combinations with metformin and Merck’s once-daily oral dipeptidyl peptidase-4 inhibitor (DPP-4) Januvia (sitagliptin). Merck will retain all rights to the existing portfolio of Januvia products, which include Januvia, Janumet (a combination of Januvia and metformin), and Juvisync (a combination of Januvia and the cholesterol drug simvastatin). The Januvia products are Merck’s only diabetes offerings; the franchise brought in north of $5 billion in sales in 2012. The N.J. pharma is also developing a once-weekly DPP-4 inhibitor that is chemically unique from Januvia.

Pfizer currently has no diabetes drugs on the market through its primary care business, but has several compounds in Phase II and I. The drug was developed internally by Pfizer in its cardiovascular and metabolic diseases research unit at Groton, Conn.

The SGLT2 Market

The diabetes treatment landscape is becoming increasingly competitive and patients now have a variety of different classes of drugs to choose from when considering how best to manage their disease.

The SGLT2 class, which works to remove excess glucose through the urine by blocking re-absorption in the kidneys, is a relatively new entrant into the diabetes treatment continuum. The first drug to receive approval from this class was Johnson & Johnson’s Invokana (canagliflozin), which got the FDA green light on March 29 Also see "J&J Gains FDA OK For First-In-Class Type 2 Diabetes Drug Invokana" - Pink Sheet, 29 March, 2013..

Other companies are well ahead of Merck and Pfizer in the development of SGLT2s. Bristol-Myers Squibb Co. /AstraZeneca PLC received a “complete response” letter from FDA for Forxiga (dapagliflozin) in January 2012 Also see "Bristol Signals Dapaglifozin’s Back On Track, Plans FDA Resubmission" - Pink Sheet, 24 October, 2012.. The drug received marketing authorization in the EU in November, but failed to get a recommendation from England’s cost-effectiveness watchdog NICE in February. The companies are currently working with the agency to provide additional information about the drug.

Bristol and AstraZeneca’s dapagliflozin had been the front runner in the category until an FDA panel highlighted safety risks regarding liver toxicities and bladder malignancies, as well as doubts about efficacy in certain populations. Bristol told investors on an Oct. 24 call that it believes it can now satisfy FDA requirements with data from extension studies, and the companies are expected to resubmit the drug mid-year.

The companies further strengthened their position in diabetes when they decided to pull together in a $7 billion risk-sharing purchase of Amylin Pharmaceuticals and its suite of diabetes products Also see "$7 Billion Amylin Buyout Boosts BMS, AZ Diabetes Partnership" - Pink Sheet, 30 June, 2012..

Eli Lilly & Co. /Boehringer Ingelheim GMBH expect an approval decision on their SGLT-2 empagliflozin later this year Also see "Lilly/BI Report Success For Oral Diabetes Drug, Adjust Alliance" - Pink Sheet, 7 January, 2013.. The drug is the second of three drugs expected to gain FDA approval that the partners have collaborated on in diabetes. They already market a DPP-4 inhibitor in the U.S. under the brand name Tradjenta (linagliptin).

Lilly has a long history in the diabetes space, including its help developing and commercializing Amylin’s once-daily glucagon-like peptide 1 antagonist (GLP-1) Byetta (exenatide) – it severed ties with Amylin in 2011. The company is expected to submit a regulatory filing this year for the once-weekly GLP-1 dulaglutide Also see "Lilly/BI Eye Diabetes Leadership In Expansive Risk-Sharing Collaboration" - Pink Sheet, 11 January, 2011..

Merck And Pfizer Make A Late Play For The Diabetes Market

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