As patents expire for Novo Nordisk’s top-selling products, the company is trying to bolster the pipeline with collaborations and a complete reorganization of R&D operations.
Novo Nordisk A/S
Novo Allé, 2880
Telephone: +45 4444 8888
|Product||2017 Sales||2016 Sales|
All sales are in millions of dollars and were translated
using the Federal Reserve Board’s average rate of
exchange in 2017: 6.5957.
|1H 2018||1H 2017|
All figures are in millions of dollars,
except EPS, and were translated using
the Federal Reserve Board’s average rate
of exchange in 2017: DKK 6.5957 = $1.00
For Lars Fruergaard Jørgensen, 2017 — his first year as president and CEO of Novo Nordisk — was an “experience.” Although Novo Nordisk leadership says the diabetes-focused company ended 2017 in a better position than when the year began, there are challenges that still persist, particularly in the U.S. diabetes market. In September 2018, Novo Nordisk signaled its seriousness in not letting these challenges overwhelm it, by acquiring a UK biotech company deciding to shake up its own R&D organization.
The board has been very pleased by Jørgensen’s performance, according to Chairman Goran Ando, who says Novo Nordisk has started “a change process that will make the company more competitive in the new business reality.”
“Resources have been directed towards the key growth drivers, an updated R&D strategy is being implemented, focused on delivering more breakthrough innovation from both in-house labs and external partners, and costs have been managed tightly, all while maintaining a high level of employee engagement,” Ando says. “Already in his first year at the helm, Lars has shown that he can lead an organization in challenging times.”
Jørgensen says his interactions over the past year with employees, patients, healthcare professionals, payers, investors, politicians, NGOs, and other stakeholders have made it clear that despite the growing competitive pressure, Novo Nordisk has a very strong platform for future success.
“Our employees want the company to do well and are deeply engaged in helping patients live better lives,” he says. “Our portfolio of pharmaceutical products, both on the market and in our pipeline, provide important clinical benefits compared with other medications. And there are millions of people with diabetes and other serious chronic diseases who need better treatment.”
“That is a strong foundation to build on and a huge responsibility for Novo Nordisk to live up to.”
One of the things Novo Nordisk did in 2017 to change the way it does business is having the International Operations group, which covers more than 190 countries, take a ‘market fit’ approach to grow its business.
“This means tailoring the portfolio, market access strategy, and sales strategy to the needs of each individual country,” Jørgensen says. “Allowing our affiliates around the world the autonomy to decide which approach is best for their markets, requires a shared understanding of what we want to achieve as a company, our overall strategic priorities and ‘how we do business’ at Novo Nordisk.”
Novo Nordisk’s “clear purpose” is “to drive change to defeat diabetes and other serious chronic diseases,” Jørgensen says. “This is what makes us relevant to patients, healthcare professionals and society at large.”
The company made two moves in September 2018 that show management is not afraid to shake things up.
Novo Nordisk acquired Ziylo Ltd., a University of Bristol spin-out company based at Unit DX science incubator in Bristol, UK, to accelerate its development of glucose responsive insulins. Through the acquisition, Novo Nordisk gains full rights to Ziylo’s early-stage glucose binding molecule. The staged acquisition has a potential deal value that could exceed $800 million and supports Novo Nordisk’s goal to develop glucose responsive insulins.
Additionally, parts of the research activities in Ziylo were spun out in a new company, Carbometrics, that has entered into a research collaboration with Novo Nordisk to optimize glucose binding molecules. Carbometrics has licensed rights for all non-therapeutic uses of glucose binding molecules including applications in diagnostics and glucose monitoring.
A glucose responsive insulin would help eliminate the risk of hypoglycemia, which is the main risk associated with insulin therapy and one of the main barriers for achieving optimal glucose control. According to company executives, a glucose responsive insulin could also lead to better metabolic control and thus overall reduce the burden of diabetes for people living with the disease.
“We believe the glucose binding molecules discovered by the Ziylo team together with Novo Nordisk world-class insulin capabilities have the potential to lead to the development of glucose responsive insulins which we hope can remove the risk of hypoglycemia and ensure optimal glucose control for people with diabetes,” says Marcus Schindler, senior VP, Global Drug Discovery, Novo Nordisk.
Also in September, Novo Nordisk announced plans to restructure the R&D organization to accelerate the expansion and diversification of the pipeline across serious chronic diseases. According to executives, about 400 employees will be laid off from R&D roles in Denmark and China, in order to “enable increased investment in transformational biological and technological innovation within both core and new therapy areas.”
Novo Nordisk additionally will establish four Transformational Research Units in 2018 to pursue novel treatment modalities and platform technologies. The biotech-like units, based in Denmark, the United States and the United Kingdom, will operate as satellites of Novo Nordisk’s central R&D function and will drive innovation in priority fields such as translational cardio-metabolic research and stem cell research.
Furthermore, Novo Nordisk will significantly increase investment in automation and digital capabilities including machine learning and artificial intelligence, to drive a faster and more efficient path towards lead molecule selection and development. According to management, the integration of laboratory infrastructure and IT systems will be prioritized to increase the efficiency of the R&D organization.
“Delivering on our ambition of achieving even higher levels of innovation across a broader and more diverse range of chronic diseases requires that we have the optimal future skill base and allocate resources to our priority areas,” says Mads Krogsgaard Thomsen, chief science officer, Novo Nordisk. “Unfortunately, this implies that a number of valued colleagues will lose their jobs in order to ensure that we have sufficient new research capabilities needed to support our long-term growth ambitions.”
The restructuring and re-allocation of resources supports Novo Nordisk’s ambition to transform the way the company works within R&D in order to identify and develop truly innovative drug candidates.
Company leaders say this will be done by identifying and pursuing new therapeutic approaches based on external collaborations – a priority that Novo Nordisk will accelerate via the establishment of a new Business Development unit in Cambridge, Mass.
“Thanks to our exciting internal assets and external partnerships, we are well-positioned to continue our leadership position by providing innovation that improves the health of people living with serious chronic diseases,” Thomsen says.
Financial & product performance
Novo Nordisk sales grew 2 percent and operating profit rose 5 percent in 2017, both in local currencies. “Sales were within and operating profit was above the range we had announced at the beginning of the year, when we predicted that sales would grow between -1 percent and 4 percent and operating profit between -2 percent and 3 percent, both in local currencies,” Jørgensen says.
Sales growth was primarily driven by Tresiba, Victoza, and Saxenda. “These are all strategic products which we expect to be major growth drivers in the coming years together with Ozempic, our new once-weekly, injectable GLP-1 treatment for adults with type 2 diabetes,” Jørgensen says. “Looking at the sales development from a regional perspective, it is encouraging to note that our two operational units, North America Operations and International Operations, both performed according to our plans. Despite strong pressure on prices, North America managed to keep sales at the same level as 2016, while International Operations grew by 5 percent.”
As reported, Novo Nordisk had 2017 sales of DKK 111.7 billion ($16.93 billion), about the same as in 2016. 2017 net income was DKK 38.13 billion ($5.78 billion), 1 percent more than the previous year. Diluted earnings per share were DKK 15.39 ($2.33), about 3 percent more than in 2016.
In the first half of 2018, sales were DKK 54.34 billion ($8.24 billion), 5 percent less than in the first half of 2017. Net income during the first six months of this year was DKK 21.09 billion ($3.2 billion), 5 percent more than in the same period in 2017. Diluted earnings per share were DKK 8.66 ($1.31), 7 percent more than in first-half 2017.
Sales of diabetes care and obesity products during 2017 increased by 4 percent measured in Danish kroner and by 7 percent in local currencies to DKK 92.89 billion ($14.08 billion). Executives say Novo Nordisk is the world leader in diabetes care with a global value market share of 27 percent.
Insulin Sales during 2017 remained unchanged measured in Danish kroner and increased by 3 percent in local currencies to DKK $63.12 billion ($9.57 billion). Measured in local currencies, sales growth was driven by International Operations where Region AAMEO, Region China, Region Europe and Region Latin America contributed to growth. Novo Nordisk is the global leader with 47 percent of the total insulin market and 45 percent of the market for modern insulin and new-generation insulin, both measured in volume.
Sales of the diabetes drug Victoza, Novo Nordisk’s best-selling product, increased by 16 percent to DKK 23.17 billion ($3.51 billion) for 2017. Management says sales growth was predominantly driven by North America Operations comprising 90 percent share of growth. The GLP-1 segment’s value share of the total diabetes care market increased to 11.8 percent compared with 9.7 percent 12 months earlier. Victoza is the market leader in the GLP-1 segment with a 50 percent value market share.
In the first half of 2018, Victoza sales totaled DKK 11.72 billion ($1.78 billion), about 2 percent more than in the same period last year.
The fast-acting insulin NovoLog/NovoRapid was the second-best seller for the company in 2017, generating DKK 20.03 billion ($3.04 billion), slightly more than in 2016. First-half 2018 sales were DKK 9.49 ($1.44 billion), 9 percent less than in the first half of 2017.
The NovoLog Mix/NovoMix line generated 2017 sales of DKK 10.26 billion ($1.56 billion), slightly less than the 2016 amount. First-half 2018 sales fell to DKK 4.91 ($744 million), 9 percent less than in the same period last year.
In 2017, sales of the modern insulin Levemir were DKK 14.12 billion ($2.14 billion), down 17 percent compared to 2016. Executives attributed the decline to lower sales in North America Operations due to price pressure in the basal insulin segment as well as the impact following the introduction of the new-generation insulin Tresiba.
The pressures on Levemir continued in 2018, as sales in the first six months were DKK 5.8 billion ($880 million), 24 percent less than in first-half 2016.
Sales of the once-daily insulin Tresiba reached DKK 7.33 billion ($1.11 billion) compared with DKK 4.06 billion ($615 million) in 2016. The roll-out of Tresiba continues and the product has now been launched in 62 countries. In the United States, where Tresiba was launched broadly in January 2016, the product maintains wide commercial and Medicare Part D formulary coverage. In September 2017, Novo Nordisk obtained approval of Tresiba in China. Novo Nordisk expected to launch Tresiba in China without reimbursement and with limited market access in first-quarter 2018.
For the first half of 2018, Tresiba sales were DKK 3.71 billion ($562 million), slightly higher than the first six months of 2017.
Although Novo Nordisk’s primary focus is diabetes, the company also has products for hemophilia and obesity, as well as hormone replacement therapies.
The hemophilia drug NovoSeven remained one of the company’s best-selling products in 2017, achieving sales of DKK 9.21 billion ($1.4 billion), down 1 percent versus 2016. Sales in the first six months of 2018 were DKK 4.04 billion ($613 million), 13 percent less than in the first two quarters of 2017.
The growth hormone Norditropin produced sales of DKK 6.66 billion ($1.01 billion) in 2017, declining from DKK 8.77 billion ($1.33 billion) the previous year. The product has lost patent protection in the United States, Europe, and Japan. In the first half of 2018, sales were DKK 3.18 billion ($483 million), 4 percent less than in first-half 2017.
As sales of many of the company’s leading products are being eroded by generic competition, Novo Nordisk is looking at new products to fill the future gap. For example, 2017 sales of Xultophy, a once-daily combination of insulin degludec (Tresiba) and liraglutide (Victoza), reached DKK 729 million ($111 million) compared with DKK 207 million ($31 million) in 2016. Xultophy sales in first-half 2018 were DKK 720 million ($109 million), compared with DKK 284 million ($43 million) in first-half 2017.
Sales of Ryzodeg, a soluble formulation of insulin degludec and insulin aspart, reached DKK 492 million ($75 million) in 2017 compared with DKK 196 million ($30 million) in 2016. In the first six months of 2018, sales reached DKK 320 million ($49 million) compared with DKK 196 million ($30 million) in same-time 2017.
Sales of Saxenda (liraglutide 3 mg) for weight management increased by 62 percent in 2017 to DKK 2.56 billion ($388 million). In the first half of 2018, Saxenda achieved sales of DKK 1.65 billion ($251 million), 35 percent more than in first-half 2017.
R&D and pipeline progress
According to Novo Nordisk executives, 2017 was a year characterized by a high flow of new clinical data, which led to regulatory approvals and label updates for several key products. The most important of these was the U.S. approval of the GLP-1 drug Ozempic, followed by a recommendation for approval by the European Medicines Agency’s expert committee, both in December 2017.
Other highlights included the approvals in the EU and the United States of Fiasp, a new fast-acting mealtime insulin, for the treatment of adults with diabetes; an EU label update for Tresiba, based on data from trials demonstrating a clinically relevant reduction in hypoglycemia compared with insulin glargine U100; and EU and U.S. label updates for Victoza, reflecting the product’s ability to reduce the risk of cardiovascular events in adults with type 2 diabetes and at high risk of cardiovascular disease.
Additional milestones include important label updates for Saxenda; the approval of the long-acting factor IX product Refixia/Rebinyn for hemophilia B in the European Union and the United States; and the submission of EU and U.S. applications for including data from the DEVOTE trial in the Tresiba label.
“Based on the strong clinical data and approvals obtained over the past year, we have an important task ahead of us in making sure that as many patients as possible benefit from them,” Jørgensen says. “This means ensuring optimal market access for our products and making sure that prescribers and patients understand the benefits our products provide.”
In 2018, Novo Nordisk continues to find partners for R&D collaboration. The company announced a partnership with Kallyope Inc. in June to discover novel peptide therapeutics to treat obesity and diabetes.
Kallyope will receive an upfront payment and research support for activities conducted in the collaboration. Under the terms of the agreement, Novo Nordisk has an option to license exclusive worldwide rights to develop and commercialize up to six products discovered in the collaboration. Kallyope will receive a license fee if Novo Nordisk chooses to exercise an option to a therapeutic discovered and validated in the joint research plan and potential research, development and sales milestones. Kallyope also will receive royalties on worldwide sales of licensed products.
The gut and the brain are tightly linked via bi-directional communication pathways collectively termed the ‘“gut-brain axis.” These include released circulating peptides and metabolites, immune factors and direct neuronal innervation. The gut-brain axis is involved in many important aspects of physiology and plays a significant role in appetite regulation and energy homoeostasis.
Novo Nordisk executives say Kallyope has developed an innovative platform to interrogate the gut-brain axis and discover new medicines in multiple therapeutic areas. The platform integrates single-cell sequencing, bioinformatics, functional and anatomical circuit mapping and organoids. The platform has enabled the discovery of new biological mechanisms, including multiple potential secreted products from the gut-brain axis that may play a role in metabolism.
Under a joint research plan, Kallyope and Novo Nordisk will collaborate on “in vitro” and “in vivo” studies to validate a number of new product candidates. Following validation and option exercise, Novo Nordisk will assume responsibility for further preclinical and clinical development, manufacturing as well as commercialization.
“Novo Nordisk is very excited about the opportunity to collaborate with Kallyope,” says Marcus Schindler, senior VP, Global Drug Discovery in Novo Nordisk. “The company has developed a unique and innovative platform and is led by an outstanding leadership team. In combination with the experience that Novo Nordisk has in the disease biology understanding, peptidomics and peptide production, the projects that we will collaborate on hold potential to make a real difference for people living with diabetes and obesity.”
In May 2018, Novo Nordisk announced an increased commitment to stem cell-based therapies and an expansion of the focus on type 1 diabetes into other serious chronic diseases, through an exclusive collaboration with the University of California San Francisco (UCSF) in which a first milestone in the development of human embryonic stem cell lines has been reached.
Under the terms of the agreement with UCSF, Novo Nordisk has licensed a technology to enable the generation of good manufacturing practice (GMP) compliant human embryonic stem cell (hESC) lines as well as the rights to further develop these into future regenerative medicine therapies. In early May, the partners reached an important milestone with the inauguration of a new GMP laboratory at UCSF where employees from the university and Novo Nordisk will be working together on deriving the cell lines that are expected to define a new quality standard in production of stem cell-based therapies.
“After two decades of intensive research focusing on the differentiation of pluripotent stem cells into insulin-producing beta cells, Novo Nordisk has now achieved preclinical proof-of-concept,” executives say. “Together with Cornell University, Novo Nordisk has also made significant progress in developing an encapsulation device that will protect the beta cells that are transplanted into patients from attack by the immune system. Novo Nordisk anticipates that the first clinical trial could be initiated within the next few years.”
Novo Nordisk continues to gather clinical data to support the use of its medicines. In September, the company announced the headline results from PIONEER 10, a Phase III trial with oral semaglutide vs once-weekly subcutaneous dulaglutide, both in combination with one oral antidiabetic drug in Japanese adults with type 2 diabetes.
Oral semaglutide is an investigational GLP-1 analog taken once daily as a tablet. The clinical trial investigated the safety, tolerability and efficacy of 3, 7, and 14 mg oral semaglutide compared with 0.75 mg once-weekly dulaglutide in 458 Japanese people with type 2 diabetes. Prior to enrollment, participants were inadequately controlled on one oral antidiabetic drug.
The study achieved its primary objective by demonstrating a comparable number of adverse events with oral semaglutide compared to 0.75 mg dulaglutide. The proportion of people treated with 3, 7, and 14 mg oral semaglutide who experienced gastro-intestinal adverse events were 31 percent, 39 percent, and 54 percent respectively, compared to 40 percent with dulaglutide; the most frequently reported events being constipation and nausea. The proportion of people who discontinued treatment due to adverse events was between 3 percent and 6 percent of people treated with oral semaglutide, compared to 3 percent of people treated with dulaglutide.
“Many people with type 2 diabetes in Japan remain uncontrolled on oral antidiabetic treatments,” Thomsen says. “When adding oral semaglutide to the treatment of this group of people, this study has demonstrated that oral semaglutide is both well tolerated and more efficacious compared to subcutaneous dulaglutide.”
In August, Novo Nordisk presented data at the European Society of Cardiology conference in Munich that Ozempic consistently reduced the risk of the composite outcome of time to first occurrence of non-fatal heart attack, non-fatal stroke or cardiovascular death (collectively termed major adverse cardiovascular events, MACE) in people with type 2 diabetes at high cardiovascular risk regardless of previously having had a cardiovascular event at the start of the trial. The findings were from two post-hoc subgroup analyses of the SUSTAIN 6 trial and one post-hoc meta-analysis of MACE in the SUSTAIN 1-5 trials.
“Cardiovascular disease remains the leading cause of disability and death in people with type 2 diabetes and there is an increasing focus on reducing cardiovascular risk in the clinic,” says Professor Stephen Bain, School of Medicine, Swansea University, UK. “We have seen from clinical trials that diabetes treatments confer variable effects on cardiovascular outcomes and the results of these post-hoc analyses provide further evidence of the consistent cardiovascular risk reduction of Ozempic in people with type 2 diabetes, with varying profiles of cardiovascular risk at baseline.”
The SUSTAIN 6 post-hoc analyses found that reduction in the risk of MACE was consistent in people at high cardiovascular risk treated with Ozempic regardless of their cardiovascular risk profile at the start of the trial, including whether or not they had a prior heart attack or stroke, and whether they had cardiovascular risk factors or established cardiovascular disease. SUSTAIN 6 was a pre-approval cardiovascular outcomes trial in 3,297 people with type 2 diabetes and cardiovascular disease or with at least one cardiovascular risk factor, compared to placebo, both in addition to standard of care.
The post-hoc pooled meta-analysis of the SUSTAIN 1-5 efficacy trials, which included 4,807 people, trended towards a lower risk of MACE in people taking Ozempic. The comparators included in SUSTAIN 1-5 were placebo, sitagliptin, exenatide extended release, and insulin glargine U100. The overall incidence of MACE was low across the SUSTAIN 1-5 trials and, due to the low number of events, this reduction did not achieve statistical significance.
In June, Novo Nordisk announced that oral semaglutide, an investigational GLP-1 analog taken as a once-daily tablet, achieved significant reductions in blood sugar versus placebo in adults with type 2 diabetes, according to findings from the PIONEER 1 Phase IIIa trial. The study evaluated the efficacy and safety of 3, 7, and 14 mg oral semaglutide versus placebo as monotherapy over 26 weeks in adults with type 2 diabetes.
Applying the intention-to-treat principle, the study achieved its primary objective by demonstrating that people treated with any of the three doses of oral semaglutide achieved significant HbA1c reductions compared to placebo (p<0.001 for all estimated treatment differences in HbA1c for oral semaglutide vs placebo). Furthermore, people treated with 14 mg oral semaglutide achieved significant reductions (p<0.001) in weight vs placebo while weight reductions with 7 mg and 3 mg doses did not reach statistical significance.
“Despite advancements in the diabetes treatment landscape, many people with type 2 diabetes still struggle to reach their HbA1c target,” says Vanita Aroda, M.D., associate director, diabetes clinical research, Brigham and Women’s Hospital in Boston. “Based on the first results of PIONEER, I am optimistic about the potential of having an oral GLP-1 receptor agonist that may help patients achieve their HbA1c and blood sugar goals.”
In another June announcement, data demonstrated that Ozempic provided greater weight reductions for adults with a baseline BMI of or above 25 kg/m2 than those with lower baseline BMI <25 kg/m2, in a SUSTAIN 7 post-hoc analysis.
While the primary endpoint of SUSTAIN 7 was change in HbA1c, this post-hoc exploratory analysis examined the secondary endpoint of change in body weight by baseline BMI. Greater weight reductions were demonstrated across all BMI subgroups (<25, 25-<30, 30-<35, >35 kg/m2) with Ozempic 0.5 mg vs dulaglutide 0.75 mg (range of weight reduction across all subgroups: 3.6-5.5 kg vs 0.9-3.4 kg) and with Ozempic 1.0 mg vs dulaglutide 1.5 mg (range of weight reduction across all subgroups: 5.2-7.6 kg vs 2.0-3.8 kg), from a mean baseline of 95.2 kg. Adults with a higher baseline BMI (>25 kg/m2) taking Ozempic generally achieved greater weight reductions than those with lower baseline BMI (<25 kg/m2).1
Also, more people achieved weight reductions of >5 percent and >10 percent with Ozempic vs dulaglutide in all BMI subgroups.
“Globally, up to 90 percent of people with type 2 diabetes are overweight or have obesity,” says Dr. Adie Viljoen, SUSTAIN 7 chief investigator and consultant chemical pathologist, East and North Hertfordshire NHS Trust, UK. “Therefore, it is important to consider how to manage weight in this population. Based on the SUSTAIN clinical trial program, Ozempic can help people living with type 2 diabetes manage their HbA1C and has the potential to help them lose some weight.”
A June announcement about Tresiba featured data from CONFIRM – a large real-world evidence (RWE) study comparing the effectiveness of Tresiba versus insulin glargine U300. The retrospective, non-interventional comparative effectiveness study, which included more than 4,000 adults with type 2 diabetes who were starting basal insulin for the first time, showed that after six months those treated with Tresiba had significantly lower HbA1c compared to those treated with insulin glargine U300 (-1.5% vs. -1.2% respectively; p=0.029).
As a secondary endpoint, there was a 30 percent lower rate of hypoglycemic episodes with Tresiba compared to insulin glargine U300 (p=0.045). This study also showed in another secondary endpoint that people being treated with Tresiba were more likely to stay on treatment. Those being treated with insulin glargine U300 had a 37 percent higher rate of discontinuing treatment after two years (p<0.001).
“Real-world studies are important to understanding how clinical trials may translate into real value for patients in everyday clinical practice,” says Todd Hobbs, VP and U.S. chief medical officer of Novo Nordisk. “The CONFIRM results add to the body of evidence on Tresiba for adults with type 2 diabetes.”
Also in June, Novo Nordisk shared results from a study of Xultophy that demonstrated adults with type 2 diabetes treated with the product also experienced no change in body weight, lower rates of hypoglyemia, and a lower insulin dose at 26 weeks.
Company management says Xultophy provided superior blood sugar reduction (HbA1c) compared to insulin glargine U-100 (1.94 percent vs 1.68 percent respectively; p<0.0001) when used as an add-on to an SGLT-2i (an oral diabetes medication). The results came from the DUAL IX study.
Results from some of the secondary endpoints in DUAL IX included change from baseline in body weight, severe or blood glucose confirmed symptomatic hypoglyemic events and daily insulin dose at 26 weeks. Mean body weight remained unchanged in the Xultophy study group versus a 2.0 kg weight gain with insulin glargine U-100. Treatment with Xultophy demonstrated a 58 percent lower rate of hypoglycemia versus insulin glargine U-100 (0.37 events/patient-year of exposure vs 0.90 events/patient-year of exposure respectively; p=0.0035). The average total daily insulin dose was significantly less with Xultophy than insulin glargine U-100 (36 units per day vs 54 units per day respectively; p<0.0001).
“Type 2 diabetes is a progressive disease that often requires treatment intensification,” says Dr. Athena Philis-Tsimikas, DUAL IX lead investigator and corporate VP, Scripps Whittier Diabetes Institute. “Xultophy may be an appropriate treatment option for those adults who are unable to meet their blood sugar goals on their current medication.”