UPDATE 2-Novo Nordisk says US approves Victoza

* Drug cleared for treatment of type 2 diabetes in U.S.

* To launch Victoza in U.S. within weeks

(Adds details from FDA statement)

NEW YORK, Jan 25 (Reuters) - Novo Nordisk NOVOb.CO said U.S. health officials approved its Victoza drug for treatment of type 2 diabetes and that it would launch the drug in the United States within weeks.

The Danish drugmaker said Victoza, also known as liraglutide, is meant to help lower blood sugar levels along with diet and exercise in adults with type 2 diabetes.

“The U.S. approval of Victoza represents a major advancement in the treatment of type 2 diabetes and is an important milestone for Novo Nordisk,” Lars Rebien Sorensen, Novo’s chief executive, said in a statement on Monday.

Novo Nordisk has said Victoza has the potential to be a blockbuster drug, meaning annual sales of more than $1 billion.

The drug had faced delays after a Food and Drug Administration advisory panel that met in April 2009 raised questions about the medicine’s safety.

The FDA said the drug’s benefits of controlling blood sugar outweighed its risks but it was requiring further study after approval of some safety issues.

In clinical trials, pancreatitis occurred more often with Victoza compared with other diabetes drugs. The agency said the drug should be stopped if patients develop severe abdominal pain and should not be restarted if blood tests confirm pancreatitis.

The FDA said it was requiring the company to conduct a post-approval study to test Victoza’s cardiovascular safety in a higher-risk group of patients. No increase in heart problems was seen in the mainly low-risk patients in clinical trials.

Novo Nordisk also must do a five-year study to evaluate the risks of thyroid and other cancer risks, seriously low blood sugar levels, pancreatitis and allergic reactions.

It is not known if Victoza causes thyroid cancers, the FDA said. In studies, the drug caused thyroid tumors in rats and mice. Cancerous tumors were increased in rats given doses eight times higher than people would receive, the FDA said.

The FDA said Victoza should not be used as a first-choice treatment for diabetes unless other studies support such use.

Victoza will compete with Byetta, the rival treatment from Eli Lilly and Co LLY.N and Amylin Pharmaceuticals Inc AMLN.O.

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.

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

Victoza produced weight loss in mid-stage clinical trials, but final obesity studies have been put on hold pending the FDA’s decision on diabetes. (Reporting by Martinne Geller and Lisa Richwine; Editing by Anshuman Daga)