Novo Nordisk (NVO) recently filed a regulatory application for its much anticipated pipeline candidate, Degludec, in Japan with the Pharmaceuticals and Medical Devices Agency (PMDA). Novo Nordisk has already applied for the approval of Degludec and Degludec Plus in the US and EU.
Degludec and DegludecPlus are next-generation insulin analogues for the treatment of type I and type II diabetes. Degludec is an ultra long-acting basal insulin while DegludecPlus is a fixed ratio combination of Degludec and NovoRapid.
Novo Nordisk conducted a large late stage clinical program with Degludec and DegludecPlus consisting of 17 separate trials. The entire endeavor included 12 trials under the BEGIN program (Degludec) and 5 under the BOOST program (DegludecPlus). Data from the trials, which studied more than 10,000 type I and type II diabetes patients, confirmed the safety, efficacy and convenience of both candidates.
Our Recommendation
We have a Neutral recommendation on Novo Nordisk. The stock carries a Zacks #3 Rank (“Hold” rating) in the short term.
So far we are impressed by the performance of insulin analogue Victoza, reputedly the biggest drug for Novo Nordisk. Victoza is doing well both in the US and Europe. Moreover, we believe that the next-generation insulin analogues, Degludec and DegludecPlus, hold significant potential for long-term growth at Novo Nordisk. Though we are encouraged by data from Degludec trials, we prefer to remain on the sidelines until Degludec and DegludecPlus gain approval.
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