GlaxoSmithKline PLC has big expectations for its glucagon-like peptide-1 receptor agonist Tanzeum (albiglutide) even though some investors and analysts have tepid hopes for the drug. The product, which was approved by FDA in April and became available in pharmacies July 25, is the fourth GLP-1 agonist to reach the market and more rivals are on the way.

“Globally we see it as one of our core big six medicines at GSK,” VP-General Medicines Cheryl MacDiarmid said in an interview discussing the launch.

The introduction of Tanzeum marks GSK’s return to diabetes after several years out of the hot therapeutic space. The company was at one time a top player in type 2 diabetes, selling the blockbuster thiazolidinedione Avandia (rosiglitazone), but Avandia notoriously fell from grace after it was linked to cardiovascular risks in a meta-analysis in 2007 Also see "Avandia Safety Under The Microscope" - Pink Sheet, 21 May, 2007..

Sales of Avandia were suspended in the EU and severely restricted in the U.S. in 2010 and GSK stopped actively promoting the drug (Also see "FDA Keeps Avandia On The Market But Looks To RECORD For More Clarity On CV Risk" - Pink Sheet, 23 September, 2010. and Also see "GSK Will End Avandia Promotion Worldwide" - Pink Sheet, 23 September, 2010.). Avandia was eventually vindicated in follow up studies and its restrictions eased by FDA in 2013, but too late for GSK, because patent protection for the drug expired in 2012 Also see "FDA Replaces Avandia REMS Distribution Restrictions With Prescriber Training" - Pink Sheet, 26 November, 2013..

Now GSK is hoping that with Tanzeum it can recreate the success it had with Avandia, which generated £1.45 billion ($2.8 billion) in 2006, including combinations with other drugs, before its sales began to decline.

The company expects Tanzeum’s once-weekly dosing regimen and value pricing will help it win market share from the market leader, Novo Nordisk AS’ Victoza (liraglutide), which is dosed once daily, even though it failed to demonstrate non-inferiority to Victoza in a head-to-head trial. It also expects to surpass the only other once-weekly rival on the market, AstraZeneca PLC’s Bydureon (exenatide extended-release), which has thus far failed to take significant share from Victoza.

“If we have an opportunity in the future to develop something in our pipeline or look beyond our pipeline to bring something in, we are interested and paying attention,” MacDiarmid said of GSK’s diabetes portfolio.

Other GLP-1s, most threateningly Eli Lilly & Co.’s dulaglutide, are close at its heels. Dulaglutide is dosed once-weekly as well and is pending at FDA. It has demonstrated non-inferiority to Victoza in a comparison trial, where Tanzeum has not ([A#00140616007]).

But GSK believes there is room in the market for multiple offerings, particularly because the market for GLP-1s is growing so strongly. The market for GLP-1 agonist products is forecast to grow from $2.8 billion in 2013 to $10.6 billion in 2022, representing a compound annual growth rate of 15.8%, according to the market research firm Datamonitor Healthcare.

Using Price To Win Over Payers

GSK is moving aggressively against its rivals by significantly undercutting on price. Tanzeum will be priced at about $326 for a monthly supply of four pens, about 64% lower than a monthly supply of the commonly-used 1.8 mg dose of Victoza and 10% below the cost of the lower 1.2 mg dose ([A#00140714016]). The cost is about 35% below the cost of Bydureon, which has a wholesale acquisition cost of $440 for a monthly supply, according to Gold Standard’s pricing database ProspectoRx ([A#00140714016]).

The pricing strategy could help GSK make headway with payers concerned about the growing cost of treating diabetes, even though Tanzeum did not show the same level of efficacy on reducing hemoglobin A1C as Victoza.

“There is a little bit here about coming to market fourth,” MacDiarmid said of GSK’s pricing strategy. “It is also designed to get us some traction and attention from payers in terms of the overall launch.”

Aside from a pricing advantage, the product also offers the advantage of once-weekly dosing, important to patients since GLP-1s are injected. It is administered via a 29-gauge needle, smaller than the 23-gauge needle used to administer Bydureon, which also has to be reconstituted prior to administration.

“We actually think that with Tanzeum we have a unique position,” MacDiarmid said. The drug was approved based on data showing superior reductions in HbA1c compared to placebo and a host of other active controls (commonly used diabetes medications).

“We have some of the similar data sets as our competitors,” she said. “We also have a unique piece of data that compares Tanzeum as an add-on to basal insulin, for those patients whose next step is probably mealtime insulin, those who are already on a background insulin.”

“We feel we have a nice value proposition once weekly with this very specific data that is relevant for this specific patient no one is really paying a lot of attention to,” MacDiarmid added.

GSK is launching Tanzeum with a sales force that MacDiarmid said is “competitively sized.” The company is reassigning reps to the product from other areas, she said. The launch comes shortly after the first generic competition to Lovaza (omega-3-acide ethyl esters) entered the market in April, and GSK has redirected reps for Lovaza to Tanzeum.

The company might also try to expand its diabetes portfolio, MacDiarmid indicated. In a category like diabetes, where leaders like Novo, Lilly and Sanofi are deeply entrenched with broad portfolios, expansion could help GSK better leverage its resources.

“We absolutely appreciate that diabetes is an area of huge unmet need. If we have an opportunity in the future to develop something in our pipeline or look beyond our pipeline to bring something in, we are interested and paying attention,” MacDiarmid said.

GSK’s Tanzeum Launch Marks The Big Pharma’s Return To Diabetes

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