Novo Nordisk has secured U.S. Food and Drug Administration approval for Victoza, its type 2 diabetes treatment for adults. The company, which has waited since May 2008 for the approval, expects to start marketing the drug within weeks, kicking off what it hopes will be a billion dollar blockbuster just five years from now.

 

Victoza, which helps control blood glucose, was approved in Japan on January 20 and Europe June 30, 2009. An application for approval is still pending in China.

 

The drug works by stimulating the release of insulin from the pancreatic beta cells only when blood sugar levels are high. Key among its differentiators is that it's not associated with weight gain, hypoglycemia or significant nausea, says Novo. Many patients taking the drug actually lose weight, the company says.

 

But despite its banner month, some analysts have questioned how much revenue Victoza will generate and how much of a positive effect it will have on Novo's share value.

 

During the last 12 months, predictions for 2010 sales of the drug fell to $591 million from original estimates of $951 million as concerns about potential thyroid cancer risks (based on rodent data) came to the fore, according to Evaluate Pharma. That risk, conveyed as a black black box warning, coupled with prohibition of Victoza as a first line treatment and post-marketing safety study requirements are dragging down enthusiasm for the U.S. launch. Then there's the competition.

 

Amylin's type 2 diabetes drug Byetta  has a five-year head start on market acceptance and is thought to be a shoe-in for approval at its new once-weekly dosage form, Byetta LAR, ironically because it is so similar to Victoza.

 

Another type 2 diabetes drug, Bristol-Myers' Onglyza, has hardly impacted BMY's share price, or that of its partner, AstraZeneca.

 

Still, Novo has high expectations for Victoza, predicting sales of over $1 billion by 2015. That leaves some time to see whether or not the drug’s disadvantages out the gate will carry any weight over the long haul.