The breakout success of GLP-1 drugs by Novo Nordisk and Eli Lilly has persuaded many of their Big Pharma peers to enter their own newly acquired candidates into the obesity race. But don’t expect Novartis to be joining them anytime soon.
“Coming in late with another one of the oral or injectable GLP [or] GIPs, we think is not a prudent approach for us as a company,” Novartis CEO Vas Narasimhan, M.D., told analysts on a second-quarter earnings call this morning.
The pharma has put “a lot of thought into” whether Novartis could play a role in the obesity space in the near-term, Narasimhan explained.
“Our view is with the current GLP, GIP, GIPR oral and injectable class of medicines, they're going to be very well served by the two leading incumbents [Eli Lilly and Novo Nordisk] who are doing extremely well in the market and are rapidly developing follow-on agents,” the CEO said.
“And so to come in with fast follower, new medicines, even with modestly differentiated profiles, will be difficult because when those medicines come forward at the end of the decade you will have substantial rebate walls, you will have a substantial portfolio block in place,” Varasimhan said. “And so very difficult to answer with just something that's relatively similar to what's already out there.”
However, it doesn’t mean Novartis isn’t keeping one toe in the obesity space. Narasimhan again alluded on the call to the company’s preclinical work on next-generation drugs that could bring something new to the weight loss table.
“That includes much more long-acting agents either through biologics or siRNAs,” the CEO said. “Either they can provide dosing advantage with tolerability advantages, or the ability for muscle sparing.”
Novartis’ earnings call came exactly a year after the Big Pharma revealed that it was removing an obesity candidate, largely kept in the shadows, from its pipeline after it demonstrated lackluster efficacy in a midstage test. The GDF-15-focused drug, dubbed MBL949, had been a high-risk, high-reward program, the company told investors at the time.
With an estimated $130 billion market to play for, it’s no surprise that many Big Pharmas haven’t had the same hesitation as Novartis when it comes to staking a claim in the obesity space. Novo Nordisk’s CagriSema—which combines the active ingredient in its blockbuster weight loss drug Wegovy with an amylin analogue called cagrilintide—is currently the most valuable R&D project going, according to a recent report from Evaluate.
The second most valuable program across the industry is a GLP-1 agonist from Lilly called orforglipron. But despite the first-to-market advantage owned by Novo and then Lilly, Evaluate said there is still plenty of room for new obesity drugs to make their mark.
Only yesterday, Roche posted the latest positive set of early stage clinical data from one of a pair of GLP-1 assets it acquired as part of its $2.7 billion buyout of Carmot Therapeutics.