Exubera's Problem: It's Still Just Insulin

Exubera's shaky start isn't that surprising. Pfizer is new to the large molecule game, Exubera's a first of its kind, and, it seems, injections aren't so much the problem as insulin itself.

"We still need to figure out how to market this drug," admitted a senior executive at Pfizer Inc. at a recent conference. Indeed. Even its maker isn’t denying that the launch of inhaled insulin Exubera has been a flop. The drug, once hailed as the blockbuster that could change millions of patients’ lives by eliminating painful injections, made only an estimated $6 million in the first quarter of 2007 in the US, with European sales likely lower still.

It’s a far cry from analysts’ predictions last year of "rapid uptake due to pent-up demand"; most have sharply revised forecasts of $1.4 billion sales by 2009. Yet Exubera’s shaky start isn’t that surprising. Pfizer might have marketing muscle, but it isn’t in large molecules. And Exubera, as the first ever inhaled insulin coming into the increasingly competitive diabetes market, presents even more challenges for its sponsor than your average biologic.

First, doctors must be convinced of the drug’s advantages over existing treatments. That doesn’t just mean longer-acting insulins such as Levemir, marketed by diabetes expert Novo Nordisk AS, and Sanofi-Aventis’ Lantus, recently approved as a pre-filled, disposable pen for once-daily use. It also means, since late last year, Merck & Co. Inc. ’s star GLP IV inhibitor sitabliptin (Januvia), taken orally (and soon to be followed by recently approved Janumet, a combination of Januvia and metformin) and Eli Lilly & Co. /Amylin Pharmaceuticals Inc. ’s incretin mimetic exanatide (Byetta). (See "Januvia: Defining Primary-Care Success and Risk," IN VIVO, March 2007 (Also see "Januvia: Defining Primary-Care Success and Risk" - In Vivo, 1 Mar, 2007.).)

Neither Byetta nor Januvia are direct competitors to Exubera—both are used to control blood sugar pre-insulin—though Pfizer would dearly like to eat into the oral market, persuading diabetics to move onto insulin earlier. But the fact that Byetta is injected twice a day—and still doing well--suggests where Pfizer may have gone wrong.

Pfizer positioned the drug’s advantage as being needle-free. Yet it seems injections aren’t the issue for patients—insulin itself is the problem, according to David Kliff, the publisher of Diabetic Investor. "It doesn’t really matter how insulin is delivered. Patients and physicians, in particular primary care physicians, are afraid of insulin," notes Kliff. Insulin is complicated--proper use involves regular blood sugar monitoring, and tracking food intake. So doctors use it as a threat to try to keep patients compliant with their oral therapies. "Going onto insulin is viewed as personal failure," opines Kliff. Byetta is relatively easy to use in comparison: it doesn’t require additional blood sugar monitoring and mimics hormones that help the body produce the right amount of insulin at the right time. (It may also lead to weight loss, rather than gain, as many insulins do.)

If Kliff’s right, those firms developing the next generation of inhaled insulins could, like Pfizer and delivery partner Nektar Therapeutics Inc., struggle to recoup their investment. [See Deal] So may many of those working on any alternative delivery forms of insulin. (See Exhibit 1.) Emisphere Technologies Inc. has already run into trouble with its oral insulin. (See Sidebar: Emisphere’s Exasperation.) In the inhaled camp, MannKind Corp. and Alkermes Inc. with partner Eli Lilly & Co. are both vying for second place, with programs currently in Phase III trials. [See Deal] Alkermes and Lilly expect to file an NDA early in 2009; insulin market leader Novo and its partner Aradigm Corp., after setbacks, aren’t far behind with their liquid-based inhaled insulin, which re-started Phase III trials in March 2006. [See Deal]

When IN VIVO spoke to these groups 18 months ago, the emphasis was on device size and simplicity as the key differentiator. Alkermes and MannKind have smaller, more convenient devices than the first-generation Exubera device, which is almost the size of a bottle of wine when expanded. (See "Inhaled Insulin: Being First Isn’t Necessarily Best," IN VIVO, December 2005 (Also see "Inhaled Insulin: Being First Isn't Necessarily Best" - In Vivo, 1 Dec, 2005.).) More importantly, Exubera dosing has to be converted from international units (IUs) to milligrams—one of the more obvious of Pfizer’s mistakes, say analysts.

Device size and simplicity still matter. Alkermes says its device, which fits into the palm of the hand, has demonstrated dose equivalence to injected insulin, meaning there’s no need to convert the dosages. MannKind’s device, too, will stick with the commonly understood IU dosing, and it also shows dose linearity (one of Exubera’s problems is that three one-mg doses is bigger than one three-mg dose).

But it’s now clear that the device isn’t the crucial differentiator for inhaled insulin products. The only way they will generate significant demand is through showing clinical benefit over injected insulin. "I don't see patient convenience [via smaller devices] making a dramatic impact on physician prescribing until they are convinced the therapeutic results are superior to injections, either via better compliance or via a superior PK/PD profile," opines Ian Sanderson, a managing director and senior analyst at Cowen & Co.

And until such superiority is proven, long-term safety will remain a major concern. John Buse, MD, PhD, president-elect of the American Diabetes Association, has warned of the risks to type 1 patients of using Exubera over long periods, in combination with longer-acting insulins (as they would likely have to do). "I see it as my job to talk people out of (using) it [Exubera]," he was quoted on the newswires as saying. Granted, Pfizer’s drug is targeted mainly at type 2 patients just getting started on insulin therapy. But the safety concerns—in particular around lung function—will probably linger without a superiority claim.

MannKind’s CEO Hakan Edstrom claims his company’s product hasn’t shown any difference in lung function versus subcutaneous insulin and that its rapid onset and shorter duration of action allow for better prandial glucose control than subcutaneous insulin or Exubera. "The only thing that our product and Exubera have in common is the pulmonary delivery route," he says. Based on its current, non-inferiority trials though, MannKind may struggle to translate these benefits into a label advantage. Sanderson expects both next-generation products to come onto the market in about 2010 with labels, like Exubera’s, showing equivalence to subcutaneous injections of fast-acting insulin.

By then, Pfizer may be able to argue that Exubera, too, does more than bypass needles. Registration trials were designed with equivalence in mind, but Pfizer is extending those two-year safety studies out to five years (mainly because of concerns over lung function). At two years, says Pfizer, Exubera showed a lower rate of hypoglycemic events and a tendency toward less weight gain than with subcutaneous insulin (though not relative to oral agents). A similarly positive result at five years—2009 or thereabouts--may boost Exubera’s fortunes.

Here too, though, it’s questionable as to what would get in the label. But convincing compliance data might help persuade payors—focused on outcomes and pharmaco-economic benefit—to reimburse more generously. At present, those patients who do try Exubera have to pay more for the privilege. The drug is typically reimbursed on Tier 3 of US formularies, which comes with a monthly $40 to $50 co-pay. That’s double the co-pay on Tier 2 injected insulins such as Lantus and almost four times the co-pay for generic oral anti-diabetics. Cost is also hampering Exubera’s European rollout, where Germany and the UK have already denied full reimbursement. (The UK’s National Institute for Clinical Excellence [NICE] effectively categorized Exubera as a drug of last resort, recommending its use only in patients unable to control their blood glucose using oral drugs or injected insulin, and who either have clinician-diagnosed injection phobia or injection-site problems.)

Meantime, though, Pfizer’s not giving up the fight. It can’t; it’s still reeling from the failure of torcetrapib, its much-vaunted Lipitor replacement. (See "Best Laid Plans: Pfizer’s Torcetrapib Tanks," IN VIVO, December 2006 (Also see "Best Laid Plans: Pfizer's Torcetrapib Tanks" - In Vivo, 1 Dec, 2006.).) The company has already allegedly invested more than $1 billion in Exubera, including hiring 900 part-time diabetes educators and undertaking doc-targeted marketing. But Pfizer initially put fewer than 300 reps onto the drug, visiting both specialists and GPs. The reps came from the pain management franchise and thus were relatively inexperienced in dealing with diabetes doctors, according to observers. Pfizer has since stepped up its game, launching a fresh marketing campaign at the start of the year, a full-blown GP sales effort and announcing a summer DTC splurge. Most significantly, from April 2007, Pfizer transferred Exubera promotion to its successful and highly motivated cardiovascular sales team—and the rep count has increased to 1,500.

Perhaps this will make a difference. The reps will after all focus on primary care docs—who treat the vast majority of diabetics. Indeed, executives at Nektar, whose shares are trading at a three-year low since its fortunes are tied more tightly to this drug than Pfizer’s, think that Exubera "hasn’t really been launched until now," notes one. The previous sales force, he says, "wasn’t as motivated." The launch itself "lacked those multimillion-dollar activities needed to support a potential blockbuster." Cowen’s Sanderson points out that there’s more overlap between CV high prescribers and diabetes drugs prescribers than there is between arthritis drug prescribers and diabetes docs (raising the question as to why the pain management team was initially charged with selling Exubera—Pfizer wouldn’t comment). More importantly, the CV reps have just undergone extensive training on Exubera—no doubt focusing on the questions and issues that have arisen since launch. So "don’t write Exubera off," warns a senior executive at Pfizer. "We’ve screwed up before on launch, and the drug has come back."

Still, a new sales force is unlikely to drastically change Exubera’s fortunes. The drug presents a double-whammy educational hurdle, Pfizer has discovered: it will use its field force to explain the "why" of inhaled insulin to physicians, and then use other resources—such as diabetic educators—to follow up on how to use the device, explained senior management during Pfizer’s first quarter earnings call. Sanderson is optimistic nevertheless that the drug will gradually claw between 5 and 8% of type 2 patients by 2011, implying sales of $900 million to $1.2 billion in the US and maybe another $300 to $400 million in Europe.

"Patients will be inhaling insulin over the next few years," insist Pfizer executives. Yet how many patients, and whose product they’ll be inhaling, is unclear. Nektar executives talk about the next-generation Exubera, planned to reach the market by 2010, with an easier-to-use device barely larger than a golf ball. But whoever wins the battle of the inhaler devices, without convincing superiority data the war may well prove to be against the long-acting, once-weekly version of Byetta—due on the market at about the same time as the next-generation inhaled products. "From a patient and physician perspective, injecting once a week is far more patient friendly than taking insulin three or more times a day, no matter how the insulin is delivered," concludes Kliff.

Emisphere’s Exasperation

Emisphere Technologies has been working on oral insulin for more than a decade--and finally its board got fed up.

In October 2006, the company reported disappointing Phase II results with its oral insulin--no difference from placebo. The stock tumbled by more than 50%. By January the long-time CEO, Michael Goldberg, MD, was out. The firing was led by Mark Rachesky, who joined Emisphere's board in 2005 when his fund, MHR Institutional Partners, loaned the company $15 million, later changing the straight debt to a convert--at $3.78 a share. That's unprofitably close to the company's current stock price (and less than half the Emisphere price when Rachesky did the convert deal).

Goldberg was blamed for poor execution of the key trial (as well as the fact that the company hasn't made much progress toward creating actual products in its nearly 19 years of life). The original trial design called for the oral insulin to be tested in very sick but stable patients; to accelerate the enrollment, the company apparently relaxed the criteria, with a placebo-like result.

In a subsegment look at patients who met the original criteria--an often unreliable analysis--oral insulin apparently did perform well. But now the company needs a new trial to prove the point. And this isn't the first trial that wasn't well executed: its oral heparin test was hurt by a poor liquid formulation whose taste turned off patients.

The company is by no means dead—it has managed to hire a new CEO, Michael Novinski, the former president of Organon USA. And it's brought on a board of big-name diabetologists to advise it on trial design and execution. It's got a new insulin formulation with apparently three times the absorption of the older version--thus reducing cost-of-goods and increasing patient convenience.

But oral insulin won't win on convenience. And it won't win by eliminating the pain of injections. New smaller needles make taking insulin relatively painless. The big advantage will be eliminating embarrassment, says one insider: "What diabetics hate is at a restaurant having to pull up their shirt and stick themselves in the stomach with a needle." Exubera doesn't solve that problem: puffing on a big device is no less obvious than sticking one's belly with a needle. Doctors, scientists, and maybe even managed-care reimbursers may not see shame as a major medical problem, but Emisphere is certainly hoping patients do.