Should the diabetes development road end for Sanofi?

Sanofi has said goodbye to Lexicon, but after years of failing to keep up with rivals, there is scope for the French drug maker to make more drastic cuts to its diabetes pipeline.

Sanofi’s diabetes pipeline keeps getting smaller. Yesterday the French group formally cut its ties with Lexicon Pharmaceuticals, terminating any future involvement in Zynquista. After the SGLT-1/2 inhibitor failed to offer real differentiation from much more entrenched rivals, Sanofi's decision to cut its losses is understandable. 

An analysis of the remainder of the French pharma giant's diabetes pipeline, using EvaluatePharma Vision data, suggests that this might not be the last project to which Sanofi could bid farewell. In particular, the case for continuing development of efpeglenatide looks increasingly hard to justify, as the group's position in the global diabetes market continues to shrink.

Top forecast diabetes drugs in 2024
Product Company Pharmacological Class 2018 sales ($bn) 2024e sales ($bn)
Trulicity Eli Lilly Once weekly GLP 1 agonist 3.20 7.13
Ozempic Novo Nordisk Once weekly GLP 1 agonist 0.28 5.28
Semaglutide Oral Novo Nordisk oral GLP 1 agonist (filed) - 3.23
Jardiance Boehringer Ingelheim/Yuhan SGLT 2 inhibitor 1.75 3.24
NovoRapid Novo Nordisk Insulin  2.97 2.43
Farxiga AstraZeneca/Ono Pharmaceutical SGLT 2 inhibitor 1.44 2.59
Tresiba Novo Nordisk Insulin  1.27 2.36
Lantus Sanofi Insulin  4.21 2.19
Humalog Eli Lilly Insulin  3.00 2.02
Tradjenta Boehringer Ingelheim DPP IV inhibitor 1.65 1.50
Source: EvaluatePharma.

Sanofi’s diminishing status in this world is highlighted by the fact that Lantus only just makes the list of the top 10 biggest selling diabetes drugs in 2024. Sales of Sanofi's crown jewel are forecast to fall by 10% annually, hit by biosimilars and falling prices. 

The group's second biggest diabetes product, Toujeo, is only forecast to grow by 3% a year, and its sales contribution will not even touch the sides of the hole left by Lantus. The company's other innovative efforts, via deals with Lexicon and Zealand Pharma, from which it licensed Adlyxin, have been left in the dust by rivals. 

Sanofi's remaining big effort here is efpeglenatide, a once-weekly GLP 1 agonist licensed from Hanmi. This is currently the subject of five phase III trials, including one large outcomes study. 

Sanofi's diabetes offerings
Product Pharmacological Class 2018 sales ($m) 2024e sales ($m)
Lantus Insulin  4,211 2,187
Toujeo Insulin  992 1,195
Admelog Insulin  110 687
Amaryl Sulphonylurea 396 418
Apidra Insulin  422 380
Zynquista SGLT 1/2 inhibitor - 331
Soliqua 100/33 GLP 1 agonist & insulin  86 231
Adlyxin GLP 1 agonist 66 128
Efpeglenatide GLP 1 agonist   91
Insuman Insulin 107 80
Source: EvaluatePharma

In a world where Eli Lily and Novo Nordisk are predicted to dominate with their already launched once-weekly GLP 1 agonists, Sanofi's pitch to stay in the race is a bold head-to-head trial against Lilly's Trulicity. This is the 900-patient Amplitude D trial, slated to yield results in early 2021.

Given Trulicity’s dominance, efpeglenatide will have to come up with some pretty convincing numbers to steal sales from the Eli Lilly drug. The cardiovascular outcomes trial, Amplitude O, will only read out at the end of 2021; again Sanofi is behind its rivals.

The question thus becomes: is the cost of pursuing efpeglenatide in type 2 diabetes worth it?

Counting the cost

According to EvaluatePharma Vision estimates, the efpeglenatide programme could cost Sanofi just over $1bn. Over half has already been spent, but according to Evaluate's calculations the clinical trials will cost the company a further $580m. 

The Lexicon write-off shows that Sanofi is prepared to draw a line under investments. Could the same happen here? 

It might also be worth remembering that efpeglenatide was originally a Hanmi drug. While the past performance is not always a guide to future performance, Hanmi does not have a stellar record in delivering for companies that have licensed its products.

Perhaps Sanofi's real hopes for efpeglenatide are in obesity. But the company's new chief executive, Paul Hudson, must be taking a long, hard look at the rationale for investing hundreds of millions more dollars into a product which stands little chance of being either better or different.

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