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Update on NVO's Victoza

Zacks Equity Research

Novo Nordisk (NVO) has a strong presence in the Diabetes Care market with one of the broadest diabetes portfolios in the industry. The company is working hard to develop its diabetes pipeline.

We note that Novo Nordisk’s Victoza, a once-daily human GLP-1 analogue, is one of the leading players in the type II diabetes market. The drug has performed well since its launch in 2010. Since Victoza’s launch, the GLP-1 market has expanded in the U.S. Novo Nordisk is the leader in the worldwide GLP-1 segment with approximately 70% of market share (in terms of value) at the end of the third quarter OF 2013, up from 66% in 2012. The drug witnessed sales growth of 28% in the first nine months of 2013. The company is looking to expand Victoza’s label.

To achieve this objective, Novo Nordisk recently filed marketing applications with the U.S. and EU regulatory bodies for Victoza 3 mg, in combination with a reduced-calorie diet and increased physical activity for chronic weight management in adults with obesity, or who are overweight with comorbidities.

We note that Victoza is already approved for improving blood sugar levels in adult type II diabetes patients. Revenues from Victoza were DKK 2.8 billion in the third quarter 2013, up 14% y/y (up 20% in local currencies).

Novo Nordisk has started a phase IV trial on Victoza comparing it with Sanofi’s (SNY) Lyxumia in Oct 2013. This 26-week study will evaluate the efficacy and safety of Victoza versus Lyxumia treatment as an add-on to metformin in type II diabetes patients. 

Novo Nordisk carries a Zacks Rank #4 (Sell). Investors may consider companies like Enanta Pharmaceuticals, Inc. (ENTA) and Questcor Pharmaceuticals Inc. (QCOR), both of which carry a Zacks Rank #1 (Strong Buy).

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