Categories
2019Q1 Diabetes

Diabetes developments in the first quarter of 2019

Press releases regarding first quarter results have been issued from diabetes competitors Novo Nordisk, Eli Lilly, Sanofi and others. Four of the main antidiabetic drug types manufactured by these pharmaceutical companies are insulin, GLP-1 receptor agonists, SGLT2 inhibitors (gliflozins) and DPP4 inhibitors (gliptins). The development in each of the four drug categories is covered in separate sections belows. Revenue market share is shifting from insulin to GLP1 and it is happening faster in the US than the rest of the world.

GLP-1 receptor agonists

Victoza® (daily injection GLP1R agonist liraglutide) from Novo (-18% YoY in the US) is competing with the weekly injection GLP1R agonists Trulicity® from Lilly (+26% YoY and -9% QoQ in the US) and in particular Ozempic® from Novo itself (+41% QoQ in the US).




It is not unreasonable to expect GLP1 to further gain value share of the total diabetes market going forward given the expected approval of oral semaglutide following the PIONEER studies and the expiration of patents on insulins Lantus®, Levemir® and Humalog®.

The dual agonist Tirzepatide (LY3298176) for the treatment of diabetes has progressed to phase 3 and Lilly is currently recruiting for the clinical trials SURPASS-3 (versus insulin degludec – Tresiba®) and SURPASS-4 (versus insulin glargine – Lantus®).

Saxenda® (liraglutide) from Novo has quickly become the best selling anti obesity drug in the world (+47% YoY).

Insulin

Lantus® (insulin glargine) from Sanofi (-37% YoY in the US) is competing with the biosimilar Basaglar® (+56% YoY in the US) from Lilly.


Humalog® from Lilly (-11% YoY in the US) will be competing with the biosimilar Admelog® from Sanofi (+18% QoQ in the US) and the recently launched generically labeled insulin lispro at half price from Lilly itself.

Despite the price pressure on insulin, Tresiba® from Novo displayed positive growth (+21% YoY and +5% YoY in the US). The ultralong-acting daily injected Tresiba® (insulin degludec) reduces the risk of hypoglycaemia.

But despite the growth from Tresiba® Novo experienced negative growth in the insuling segment because of NovoMix® (-20% YoY), NovoRapid® (-6% YoY), Levemir® (-8% YoY) and human insulin (-17% YoY). Furthermore Levemir® faces patent expiration in 2019. Sanofi experienced negative growth because of Lantus® (-37% YoY in the US), whereas Lilly experienced positive growth because of their biosimilar Basaglar® (+56% YoY in the US).

SGLT2 ihbitors (gliflozins)

The SGLT2 inhibitors however have side effects that oral semaglutide does not have. But Farxiga from Astra and Jardiance® experiences growth (+17% and +35% YoY respectively) while FDA approval of oral semaglutide is pending.


DPP4 inhibitors (gliptins)

Boehringer Ingelheim and Lillyannounced in February, that the CAROLINA cardiovascular outcome trial of Trajenta® met its primary endpoint of non-inferiority compared with glimepiride.

Merck wrote in their earnings press release, that sales of Januvia®/Janumet® “declined slightly due to continuing pricing pressure in the United States, which more than offset strong demand from international markets.”

Below are headlines from the press following the earnings releases:
Bloomberg: Eli Lilly CEO on 1Q Results, Drug Pricing, Pharma Margins
Reuters: Eli Lilly misses estimates for top-selling diabetes drug Trulicity, shares slip
Reuters: Novo Nordisk profit tops forecast as new diabetes drug shines

Categories
2019Q1

Apple iPhone and China troubles?

Apple issued a press release about their quarterly results with the headline “Services Revenue Reaches New All-Time High of $11.5 Billion”.

“Our March quarter results show the continued strength of our installed base of over 1.4 billion active devices, as we set an all-time record for Services, and the strong momentum of our Wearables, Home and Accessories category, which set a new March quarter record,” said Tim Cook, Apple’s CEO. “We delivered our strongest iPad growth in six years, and we are as excited as ever about our pipeline of innovative hardware, software and services. We’re looking forward to sharing more with developers and customers at Apple’s 30th annual Worldwide Developers Conference in June.”
“We generated operating cash flow of $11.2 billion in the March quarter and continued to make significant investments in all areas of our business,” said Luca Maestri, Apple’s CFO. “We also returned over $27 billion to shareholders through share repurchases and dividends. Given our confidence in Apple’s future and the value we see in our stock, our Board has authorized an additional $75 billion for share repurchases. We are also raising our quarterly dividend for the seventh time in less than seven years.”

iPhone revenue was down and revenue in China was down. Despite this the share price rallied.

Apple is still the largest US manufacturer of several electronic home devices; i.e. phones, watches, smart speakers, tablets, laptops and desktops. And just to put things into context, Apple Services is larger in terms of revenue than Amazon subscription services and Google ditto (Google in-app purchases, Google Play store, Google Cloud, YouTube subscriptions) combined.

I would not buy Apple at current levels, but I would hold on to it. In my opinion it has a wide moat in several product segments and geographic segments.

Reuters: Apple optimistic as accessories, iPhone price cuts help China sales

Bloomberg: Apple Forecast Beats Wall Street Estimates; Shares Rally

CNBC: Apple stock spikes after reporting strong guidance and earnings beat

CNBC: Apple is finally moving beyond the iPhone as the smartphone industry stalls out