Diabetes decline hangs over Sanofi's growth in specialty care, immunology
- French drugmaker Sanofi warned investors its diabetes business in the U.S. will likely weaken further in 2017 as the impact of formulary exclusions for key drugs like the insulin Lantus (glargine) builds.
- "We expect the US diabetes decline to accelerate over the remainder of the year," Sanofi CEO Olivier Brandicourt said on an earnings call Friday, indicating 2017 diabetes sales would likely come in below the lower end of the company's long-term guidance of a 4% to 8% annualized decrease in the business.
- No surprise, then, that Sanofi highlighted its growing specialty care franchise and touted the launch of its newly approved immunology flagship Dupixent (dupilumab). An expected approval of Kevzara (sarilumab) in rheumatoid arthritis later this quarter could further improve the story there.
The diabetes market in the U.S. has tightened across the board, but Sanofi (and Danish drugmaker Novo Nordisk) has felt the pinch more than rival Eli Lilly.
U.S. diabetes sales fell 15% in the first quarter, but Sanofi's Brandicourt cautioned the company had not yet felt the full impact of changes in formulary position for Lantus on major health plans.
Last year, both CVS Health and United Health — two large pharmacy benefit managers — removed the blockbuster basal insulin from their 2017 formulary lists, giving preferred placement to Eli Lilly and Boehringer Ingelheim’s Basaglar (glargine injection) instead.
CVS' decision only had a partial impact on sales in the first quarter, and the United Health exclusion took effect on April 1 — meaning the 15% decline seen in the three months through March probably represents the best that can be expected for the remainder of the year.
Sanofi has rolled out a $10 co-pay program for both Lantus and its follow-on med Toujeo (glargine), which has helped the drugmaker retain some of its prescription volume, said Peter Guenter, head of Sanofi's Diabetes and Cardiovascular unit.
Outside of diabetes, Sanofi is encouraged by the growth from its Sanofi Genzyme unit, which figures to be a larger focus for the company moving forward. In particular, the multiple sclerosis drugs Aubagio (teriflunomide) and Lemtrada (alemtuzumab) performed well: combined sales increased 32.4% in the first quarter compared to the same period a year prior.
But the drugs accounted for only about 6% of Sanofi's net sales for the quarter. Even the specialty care business itself, as currently composed, represents less than a fifth of Sanofi's net sales — meaning, in other words, Sanofi is still very much in transition.
Immunology is one bright spot in that shift. The launch of Dupixent has progressed nicely, with no major operational challenges to date, David Meeker, outgoing head of Sanofi Genzyme said Friday.
Sanofi is focusing on 7,000 physicians in the U.S. who have experience prescribing biologics. As of last week, roughly 1,200 doctors had written around 2,500 prescriptions and Sanofi hopes to have broad coverage from most payers by the end of the year.
The drugmaker also plans to quickly expand Dupixent's label beyond the current approval for atopic dermatitis. A regulatory submission for the drug in adult patients with asthma could come as soon as the fourth quarter, Sanofi said.
Securing approval for the arthritis drug Kevzara would further boost Sanofi's prospects in the broader immunology space. The Food and Drug Administration has set a target decision date of May 22 and Sanofi has already secured an endorsement for approval in Europe from the European Medicines Agency.
Overall, company net sales rose 8.6% at constant exchange rates to €8.65 billion ($8.16 billion), as growth from Sanofi's Genzyme and Pastuer units offset a nearly 8% decline in the diabetes and cardiovascular business. Excluding the impact of Sanofi's acquisition of Boehringer Ingelheim's consumer healthcare business and consolidation of vaccines operations, however, net sales growth drops to 3.5%.
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