Novo CEO hopeful on Victoza approval

NEW YORK (Reuters) - Novo Nordisk's (NOVOb.CO) new diabetes drug Victoza has reached the final decision stage at the U.S. Food and Drug Administration and approval is the most likely outcome, the group's chief executive said on Wednesday.

Lars Sorensen, who heads the world's biggest producer of insulin, also said the drug was achieving rapid uptake in Europe and was set to overtake Eli Lilly's (LLY.N) and Amylin Pharmaceuticals Inc's (AMLN.O) rival Byetta treatment in Germany by the end of the year.

The delays facing Victoza in the all-important U.S. market have cast a shadow over the Danish drugmaker's prospects this year, as U.S. regulators pore over safety data for the injectable medicine.

"Potentially all the outcomes are still possible. A rejection is still possible, a demand for refiling is still possible, and an approval is, of course, possible -- we would submit more likely than the other outcomes," he told the Reuters Health Summit in New York.

"The potential benefits of this drug clearly outweigh any risk."

A final FDA verdict is expected this month or next.

"Our U.S. affiliates had daily communications with the division of biologics at the FDA and it has come down to the final decision," Sorensen said.

He still believes the drug has blockbuster potential, meaning annual sales of more than $1 billion.

OBESITY HOPE

In addition to treating diabetes, Novo also sees a long-term future for Victoza in treating obesity.

Victoza has produced impressive weight loss in mid-stage Phase II clinical trials, but final Phase III obesity studies have been put on hold pending a final decision by the FDA on diabetes.

Victoza and Byetta both belong to the GLP-1 class of drugs that stimulate insulin release when glucose levels become too high. Other GLP-1 drugs are also being developed by rival drugmakers, such as GlaxoSmithKline Plc (GSK.L) and Roche Holding AG (ROG.VX).

Novo's drug was approved in Europe in July and has been launched in Germany, Britain and Denmark, with other markets set to follow next year.

"We've been positively encouraged by the take-up in Europe -- it's been very, very strong," Sorensen said.

Novo disappointed investors last month by giving a cautious outlook for 2010, predicting sales growth in local currencies of 5 percent to 10 percent and operating profit up at least 5 percent.

Part of the caution was attributed to conservative assumptions about the impact of U.S. healthcare reform. Sorensen said there could be "upside" to forecasts if an expected overhaul of U.S. healthcare was watered down or delayed.

Novo Nordisk is unusual among drugmakers in giving clear guidance on the impact of U.S. healthcare reform. Most other companies have shied away, while the issue remains unresolved on Capitol Hill.

In the short term, the Danish group expects a hit to sales from planned Medicare changes and a promise by pharma companies to help fund wider access to medicines.

Longer term, though, increasing coverage for more Americans suffering from diabetes should be positive for drug volumes.

"We would anticipate there is going to be a drag on the top line for a couple of years, perhaps three years," he said. "Volume impact would happen three years and onward."

(Additional reporting by Sam Cage, editing by Tim Dobbyn)