Diabetes: time for a new regime?

In 2001, diabetes drugs represented six of the leading 100 pharmaceutical brands in terms of global sales, combining for $8.2 billion in sales. Sales were led by Bristol-Myers Squibb's Glucophage franchise and Novo Nordisk's Novolin insulins. But with patent expiries looming and new competition on the horizon the market looks set for change. Datamonitor's brief Current and Future Diabetes Blockbusters shows that the sales achieved by the leading drugs in this market underline the importance of diabetes brands to the overall market performance and positioning of major pharmaceutical company portfolios. However, competition is fierce and with the recent or approaching patent expiry of several key compounds, companies are aiming to maximize revenue streams for existing products while looking to their pipelines with renewed urgency for potential future blockbuster drugs. A wind of change? In the type 2 diabetes market, Bristol-Myers Squibb has been the biggest loser, as the combination of the genericization of Glucophage (metformin), resulting in dramatically declining sales of the leading anti-diabetic, and strong growth of newer oral anti-diabetics, such as Takeda's Actos (pioglitazone) and GlaxoSmithKline's Avandia (rosiglitazone), which saw sales rise by 73.2% and 53.1% in 2001 respectively, means that the branded thiazolidinediones are gaining ground on Glucophage. As generic metformin continues to gain volume share of the market and sales of branded oral anti-diabetics such as Avandia and Actos continue to grow, the thiazolidinediones can be expected to increasingly dominate the market, with Actos and Avandia firmly establishing themselves in the ranks of the highest-selling diabetes drugs. Actos, developed by Takeda and licensed to Eli Lilly for co-promotion in the US, overtook Avandia to become the class leader based on combined 2001 revenue of $1.3bn from Takeda and Eli Lilly. Even taken separately, Takeda's brand of Actos almost achieved blockbuster status in 2001, growing by 73.2% during the year and generating sales of $990 million compared to $361 million for Eli Lilly. Compared to Avandia, Actos has benefited primarily from its superior side effect profile, which is reflected in the price premium that the drug commands. The growth of the drug has been fuelled by its increasing popularity in the US where according to the Eli Lilly's website, Actos has been the most commonly prescribed TZD amongst endocrinologists since February 2000. The future's bright, the future's oral The largest unmet need in the diabetes market is improved delivery of insulin. Currently, the predominant mode of insulin administration is subcutaneous injection, which is extremely unpopular among patients. The poor compliance among type 2 patients results in a smaller potential market for insulin products. The annual cost of long-term complications (including amputations, dialysis, blindness and cardiovascular disease) from diabetes is estimated to be $113 billion in the US market alone. Providing novel methods of insulin delivery will expand the target population as type 2 patients will be more likely to accept insulin treatment earlier. More importantly, the ease of use associated with oral and inhaled insulins will improve compliance and decrease the cost related to long-term complications in diabetics. The population of diabetic patients in the seven major markets is projected to grow 10% from 2002 to 2008 (39 million to 43 million). Furthermore, the rate of growth in the diabetic population is also increasing. Type 1 patients, who account for approximately 10% of the total diabetic population, require the use of insulin at or soon after diagnosis. Insulin remains the only medication used for disease management in type 1 diabetes. While diet and lifestyle modifications can be effective in type 2 patients with less severe disease manifestations, pharmacologic therapy is eventually needed in the majority of patients. Although many patients can be effectively managed on oral anti-diabetics, it is estimated that 30% to 40% of type 2 patients will ultimately require the use of insulin in their disease management, leaving significant potential in the insulin market for future blockbusters. New order... From 2000 to 2001, rankings of the six top selling diabetes drugs did not change despite the strong growth of Takeda's brand of the oral anti-diabetic, Actos. BMS's Glucophage franchise, Novo Nordisk's Novolin drug brands and Eli Lilly's insulin Humulin remained the top three highest selling diabetes agents with the Glucophage franchise continuing to lead sales in the disease state, benefiting from BMS' efforts to extend the drug's lifecycle. However, this is clearly no longer possible as sales dropped by a dramatic 86% in the first half of 2002. Novo Nordisk's Novolin family of drugs took second place whilst Eli Lilly's insulin products, Humulin and Humalog took third and sixth positions, respectively. GlaxoSmithKline's Avandia remained the fourth highest selling diabetes drug in 2001 protecting its lead over Takeda's brand of Actos although not over combined sales of the compound. While the downfall of the Glucophage family has allowed Eli Lilly and Novo Nordisk to rise to the top of the diabetes market, each company's respective pipeline drug exhibits the potential to support continued strength in the diabetes market through to the end of the decade. Eli Lilly holds worldwide marketing rights to Oralin, an orally administered insulin expected to reach the market in 2005. By satisfying the unmet need of a novel insulin delivery technology, Oralin should exceed $1 billion in sales by 2008. Novo Nordisk, with its strong focus on diabetes, will most likely add AERx, an insulin inhalation device, to its portfolio in 2005. With Eli Lilly's experience in the insulin and diabetes market, Oralin sales could reach $876 million by 2008. If you found this week's Expert View useful, you may be interested in Datamonitor's reports, all available from http://www.datamonitor.com/healthcare :

· Current and Future Diabetes Blockbusters : Non-injected Insulins- Hype, Hope or Reality? priced $1,500

· Diabetes: Targeting Disease Prevention - A Look Beyond Glycemic Control priced $1,500

· Market Dynamics 2001 : Diabetes - The Changing Face of the Diabetes Market priced $6,100

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