E Novo Nordisk's Saxenda Approved But Company Enters Into A Crowded Obesity Market

This past week Novo Nordisk (NVO) received Saxenda approval by the FDA to treat patients with obesity. Saxenda is liraglutide in higher doses -- 3 mg to be exact - which is already approved by the FDA to treat patients with type 2 diabetes. The FDA vote was a major landslide win as there were 14 that voted yes to Saxenda approval  and 1 that voted no.  The approval of Saxenda is not a solo tool for obese patients to lose weight. As with all other current obesity drugs out in the market patients must use it in conjunction with diet and exercise.

The good part about Saxenda is that it is: one time a day treatment drug. The downside is that it needs to be taken as an injection into the body. Novo Nordisk expect to launch the drug sometime in the 1st half of 2015 and has already filed an application with the European Medical Agency -- EMA -- for approval in Europe. There was one other obesity drug approved earlier this year in 2014 known as Contrave which is marketed by both Takeda Pharmaceuticals (TKPHF) and Orexigen Therapeutics (OREX). Some other obesity drug makers already selling in the U.S. market are Arena Pharmaceuticals (ARNA) with Belviq, and Vivus Inc.(VVUS) with Qsymia. 

The obesity drug space already has many competitors and it will be hard to see how Saxenda stands up against all these other obesity drugs. What will matter though is the price at which Saxenda is set at. That is because Contrave, Bevliq, and Vivus Incorporation, all offer an oral version of the drug which is a lot more convenient than an injection. In terms of efficacy Saxenda is just about the same as with all these other obesity drugs mentioned coming in with patients losing around 9.2% body weight over a 56-week study. Patients in the placebo group in the trial lost only 3.5% of body weight over the same time period. 

As of right now all these approved obesity drugs are having a rough time because of problems with reimbursements from medical insurance companies, and a slow start to marketing these drugs to the patients that need it. Also not many people recognize obesity as an actual disease and think of it only as a lifestyle problem. This in turn allows insurance companies to not want to cover these types of claims, because in their eyes, they are not life threatening. The problem is that obesity is life threatening because it can cause other problems like: Heart disease, type 2 diabetes, and high blood pressure.

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Dick Kaplan 3 years ago Member's comment

Thanks, I've had my eye on this stock.