Obesity
Novo isn't exactly sweating GLP-1 pills
While excitement builds for the GLP-1 obesity pills Eli Lilly and other drugmakers are developing, Novo Nordisk CEO Lars Fruergaard Jørgensen has a word of warning: watch out for safety.
Novo's injectable semaglutide (sold as Ozempic and Wegovy) is made up of peptides, which are large molecules, and has a long track record for safety. But the pills that other companies are studying are made up of small molecules, which could get into different parts of the body and also introduce new side effects. Pfizer stopped trials of one of its small-molecule candidates due to elevated liver enzymes. "There will be very low regulatory appetite for introducing oral treatment that comes with some safety issues," Jørgensen said.
Novo does have an oral version of semaglutide, but in peptide form, not as a small molecule. This is sold to diabetes patients as Rybelsus, and Novo has also tested a much higher dose for obesity. Jørgensen said that a key hurdle with launching this type of treatment would be building up enough supply of the underlying ingredient. The oral treatment requires a large amount of the ingredient for enough to be absorbed and circulated in the body, and Novo is currently "many-fold ramping up" supply capacity, the CEO said.
Math
A clever and depressing justification for high U.S. drug costs
Another interesting thought from Jørgensen, the Novo Nordisk CEO. He talked a lot during his presentation about the health economics of GLP-1 drugs, arguing that they return more money to the economy than they cost. And he was asked how that changes in the U.S., where they are more expensive, compared to other countries.
Jørgensen's answer: Everything else in U.S. health care that GLP-1 drugs might prevent by reducing obesity (he didn't say, but think hip replacements, heart bypass surgeries, and cancer treatment) is also much more expensive in the U.S., so the math still works.
This isn't a new idea. But it will probably make you happy if you are looking to price a new GLP-1 drug in the U.S., and depressed if you're trying to imagine a way to lower America's health care bill.
M&A
Today on the Cytokinetics show
J.P. Morgan began with the Wall Street Journal reporting that Cytokinetics, maker of an effective treatment for a genetic heart disease, was close to selling itself to Novartis. Hours later, Reuters reported that AstraZeneca and Johnson & Johnson had also submitted bids for the company and that a deal could materialize as early as this week.
The fun part of this all happening in the middle of the industry's largest investor conference is that the relevant CEOs are frequently in front of live microphones. Vas Narasimhan, sitting across from CNBC's Jim Cramer, declined to comment specifically on a Cytokinetics acquisition but did issue a sort of implied denial. "I want to highlight that while we look at larger deals, our M&A strategy is bolt-on," Narasimhan said, which means focusing on "sub-$5 billion assets." Cytokinetics, with a market cap of $10 billion, would fall outside that definition.
This of course could be multi-dimensional chess playing out in public while the two companies negotiate in private, a feint to confuse rival bidders, or a classic case of the world reading too much into what amounts to boilerplate words from a pharmaceutical CEO. Whatever the case, Cytokinetics' share price fell as much as 10% after Narasimhan's interview.
Scene report
Party exit lines you only hear at JPM
"Great seeing you, but I gotta go see Takeda about a molecule."
No comments