PREVIEW-Takeda new diabetes drug seen good but not great

By Edwina Gibbs

TOKYO, June 5 (Reuters) - A drug candidate critical to Takeda Pharmaceutical Co Ltd's (4502.T) mainstay diabetes franchise is expected to show sufficient promise to gain approval but may not be much better than a rival medicine from Merck & Co (MRK.N).

Takeda's drug, called alogliptin or SYR-322, is under regulatory review and data will be presented at the American Diabetes Association's annual meeting, which runs from June 6-10.

Japan's largest drug maker has grown globally on the strength of its diabetes pill Actos, which has annual sales of more than $3 billion but will lose U.S. patent protection in 2011.

With alogliptin, which belongs to a new class of diabetes drugs called DPP-4 inhibitors, Takeda hopes to not only compete with Merck's drug Januvia, the only DPP-4 on the U.S. market, but also offset some of the drop-off in Actos sales that will come with generic competition.

Abstracts of the data have been released, prompting most Tokyo-based analysts to tentatively pronounce alogliptin to be roughly the same as Januvia in terms of safety and efficacy.

For some analysts, it is less than exciting.

"In terms of efficacy, it seems to be only about the same as Januvia. Since it's going to be the second drug to market in this class, it would have been nice to see greater efficacy," said Hiroshi Tanaka, an analyst at Mizuho Securities.

Januvia had sales of $272 million in the latest quarter, on track to become a billion-dollar blockbuster product.

But other analysts saw the glass as being half-full, touting alogliptin's likely approval later this year, the probable development of an alogliptin/Actos combination pill and other combination medicines, as well as Takeda's marketing prowess in the type 2 diabetes field.

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"Takeda is well-positioned to develop a greater variety of combination treatments, to go to doctors and be able to recommend specific combination medicines for different types of patients -- that's a strong commercial advantage," said Hiroshi Shimura, a drugs analyst at UBS Securities.

Shimura also said alogliptin could be used in combination with insulin, while Januvia cannot.

Like Merck, Takeda will probably also develop a combination pill with the generic drug metformin, and alogliptin has also been tested in combination with sulfonylureas (SUs), another older type of diabetes medicine.

Merck will not be able to offer a combination pill with Actos until Actos comes off patent.

Dipeptidyl peptidase-4 or DPP-4 inhibitors like Januvia and alogliptin work to enhance the body's ability to lower elevated levels of blood sugar.