Lilly Stands By Experimental Diabetes Drug, Despite Questions About Data

Despite early evidence that one of its experimental diabetes drugs may cause higher heart and blood pressure rates, Eli Lilly remains adamant that development should continue.

Its support for the drug, which is known as GLP-1 fc, was questioned on a wide-ranging Oct. 21 earnings conference call that also focused attention on a newly announced reorganization of research and development functions across the company (¹ (Also see "Lilly Rips Page From Big Pharma Playbook: Reorganize, Cut Costs" - Pink Sheet, 14 Sep, 2009.)). During the call, the company provided a brief update of its R&D pipeline as it strives to focus more narrowly on selected therapeutic areas.

The reorganization, in fact, singles out diabetes as one of two key therapeutic areas in which Lilly expects to devote substantial resources. Underscoring the point, Lilly officials noted that two diabetes compounds have recently moved to Phase I testing. At the same time, the drug maker is actively pruning its pipeline - two compounds in Phase II and six more that were in Phase I. It also said that it had stopped Phase III clinical trials of a multiple sclerosis drug that did not meet its primary endpoint of delaying disease progression.

"Obviously, this is a business with a lot of risks," said John Lechleiter, Lilly's chief executive, in response to questions about recent setbacks in the lab and drug development, in general. "There are acts of men and acts of God, and sometimes, the acts of God set you back, but you still got to figure out how to recover from those, and I think we've done that historically."

One analyst, however, noted that the experimental drug, which is a glucagon-like peptide-1, ²

yielded statistically significant, dose-dependent increases in heart and blood pressure rates compared with a placebo in a Phase I trial of 20 patients. The data was presented at a recent European Association for the Study of Diabetes meeting in Vienna.

The findings are puzzling some Wall Streeters, who question Lilly's ongoing commitment to its GLP-1 fc, which is currently in Phase II/III testing. That's because Lilly already plans to seek regulatory approval for a once-weekly, long-acting version of its Byetta (exenatide) drug for type 2 diabetes, which is an add-on therapy currently approved for use with metformin, a sulfonylurea or a thiazolidinedione.

R&D Head Confirms Support for GLP-1 fc

The once-weekly version, which is being developed in conjunction with Amylin Pharmaceuticals, is known as Byettta LAR (long-acting exenatide) and is also a GLP-1 treatment, but with a profile that analysts believe is superior to the drug Lilly is developing by itself. The companies hope to win FDA approval in time to market Byetta LAR by the latter half of 2010.

"If we look at the GLP-1 program, the GLP fc, and we look back at the…data, we see some issues with heart rate and some issues with dystolic pressure," said Tony Butler of Barclays Capital during the question-and-answer portion of the Oct. 21 conference call.

"I'm just curious how you actually justify moving the product along and I would be interested in your thoughts, especially when John alluded to there are failures due to acts of God and failures due to acts of man, and I'm wondering - could this be a failure due to act of man?"

In response, Steve Paul, a Lilly exec VP who heads the research labs, was unequivocal about maintaining support for the drug and downplayed the recent data indicating higher heart and blood pressure rates. "We're very, very excited about the GLP-1 mechanism for treating diabetes. There's no class of drugs that shows this kind of glycemic control, and the clinical data on the efficacy has really been tremendous, and I include in this our own once-weekly GLP fc," he said.

"Now with respect to cardiovascular liability…we are very knowledgeable about what we need to do with respect to cardiovascular liability. This drug does not produce, at doses that are very therapeutic and very effective, increases in blood pressure," he continued.

"Okay, there are some small increases in heart rate, a couple of beats per minute. By the way, this may be a class effect for all GLP 1 drugs. We are very confident with the safety data we have. Now," he concluded, "we need more safety data as we test the drug. But we are constantly monitoring all the GLPs in development and feel this is going to be a very important standard of care eventually for treating Type 2 diabetes."

Lilly execs also pointed out that the results reflected "supertherapeutic" doses of 5 milligrams, which were "significantly higher" than what were studied in a Phase II trial. That data was presented earlier this year at the American Diabetes Association, and Lilly execs noted those didn't yield an increase in blood pressure.

However, one analyst, who asked not to be named, said in an interview following the earnings call that the higher heart and blood pressure rates could become more notable if Lilly's experimental drug is eventually given to a large patient population.

"Investors are talking to diabetes experts, who are talking down the (drug), because they think when you see any blood pressure rise in a class that has not shown this before, you will see it when you give the drug to a larger population," this analyst noted. "This view (exists) even if you pick a lower dose where it has been less of an issue in early trials. … Why are they pursuing this, given the [blood pressure] profile?"

Lilly's GLP-1 Strategy: Building a Better Mousetrap?

Consequently, there is speculation about Lilly's strategy toward its GLP-1 drugs, as well as its relationship with Amylin. As one wag sees it, Lilly and Amylin are poised to dominate the type 2 diabetes field, even though Novo Nordisk is expected to get to market with its own GLP-1 a few months sooner (³ (Also see "Survivor: Novo Nordisk Sets Levemir Apart Amid Synthetic Insulin Scare" - Pink Sheet, 6 Jul, 2009.)). But given that Byetta LAR is a once-weekly drug - compared with Novo's once-daily version - Lilly and Amylin should have an important advantage.

"The only thing I can possibly think of is that Lilly wants to buy [Amylin] and buy it cheaper. By talking up their own thing, they're doing their best to limit their exposure to any negative developments with LAR," David Kliff, who publishes Diabetic Investor, said in an interview, noting that Byetta was linked to pancreatitis. "If people think Lilly is developing its own GLP-1, maybe Amylin isn't as valuable. So maybe they're hedging their bets.

However, in an interview, Barclay's Butler said Lilly's plan to simultaneously develop both drugs makes sense for another reason. "I think it's a brilliant strategy. First, second, third, whatever generations of the same theme - they get LAR and their own GLP-1. There are positive rationales for doing so, such as obtaining evidence for improving patient outcomes. Maybe this newer one has a smaller needle [than LAR]. But there are lots of benefits to this strategy. Essentially, it's like trying to build a better mousetrap."

- Ed Silverman ( ⁴ [email protected] )