Novo Nordisk's Saxenda Gets FDA Nod, Launch in 1H15 - Analyst Blog

Zacks Equity Research
Updated

Novo Nordisk's (NVO) Saxenda (liraglutide 3 mg) received FDA approval as the first once-daily human glucagon-like peptide-1 analogue for the treatment of obesity. The company intends to launch Saxenda in the U.S. in the first half of 2015.

The approval came on the back of a 14:1 vote by an FDA Advisory Committee regarding the overall risk-benefit of the product and its efficacy and safety in chronic weight management.

Saxenda can be used as an adjunct to reduced-calorie diet and increased physical activity for chronic weight management in obese (BMI ≥30 kg/m2) or overweight (BMI ≥27 kg/m2) adults suffering from at least one weight related comorbidity such as type II diabetes or cardiovascular disease.

Lower doses of liraglutide (1.2 mg and 1.8 mg) are already available under the trade name, Victoza, for the management of type II diabetes.

Saxenda is currently under review by the European Medicines Agency for the same indication.

Our Take

We are encouraged by the approval of Saxenda in the U.S. Although the market for obesity management is pretty crowded with approved treatments including Takeda (TKPYY)/Orexigen’s (OREX) Contrave and Arena Pharmaceuticals’ (ARNA) Belviq, the increasing prevalence of obesity across the world and its association with modern-day lifestyle provides ample opportunity for new drugs like Saxenda. According to Novo Nordisk, approximately 35% of the adult population in the U.S., i.e., nearly 80 million people, suffer from the disease.

Novo Nordisk had stated in a presentation in Oct 2013, that it expects demand for Saxenda to come from a small segment of people suffering from obesity. However, the company aims at increasing market share once it successfully captures the demand of patients currently undergoing treatment for obesity.

Novo Nordisk carries a Zacks Rank #4 (Sell). Arena Pharmaceuticals is a better-ranked stock with a Zacks Rank #2 (Buy).


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