Bayer, Hua Medicine snag first-in-class nod in China for Roche castoff diabetes drug, but commercial value uncertain

China’s Hua Medicine has spent over a decade on one medicine—a diabetes candidate in-licensed from Roche. Now under a partnership with Bayer, the drug has snagged a global first-in-class nod in China.

Hua’s dorzagliatin is a glucokinase activator (GKA), and the Chinese green light ends a 10-year drought in Type 2 diabetes in terms of no medicines with new mechanisms of action entering the market, the company said (PDF) Sunday. The drug is allowed for use either alone for new patients or in combination with metformin for treatment-experienced patients.

Through a 2020 deal, Hua has teamed with Glucobay maker Bayer for local commercialization of dorzagliatin, now bearing the brand name HuaTangNing. The company has also tapped state-owned Sinopharm for distribution. But heavy price cuts on older diabetes meds, lack of a clear path to the U.S. and EU markets and competition from experienced players like Novo Nordisk have put a big question mark on dorzagliatin’s commercial potential.

Hua’s founder and CEO Li Chen, Ph.D., brought dorzagliatin into the fold from Roche, where he had worked for 18 years before building Hua around the GKA med. Glucokinase is a regulating sensor of blood glucose levels. The med attracted some investor heavyweights including ARCH Venture Partners, whose co-founder Robert Nelsen is still Hua’s chairman.

But the GKA field has seen plenty of failures. These include another Roche candidate, piragliatin, which was terminated after phase 2 showed liver toxicity. AstraZeneca’s AZD1656, Amgen’s AMG 151 and Merck’s MK-0941 are other GKA meds that didn’t pass muster in clinical trials.

Dorzagliatin’s data from two phase 3 trials conducted in China also weren’t very impressive. The SEED trial showed dorzagliatin monotherapy lowered blood sugar levels as measured by HbA1c by 1.15% after 24 weeks of treatment, versus 0.58% for the placebo group. In the DAWN study, the dorzagliatin-metformin combo lowered Hb1Ac by 1.02% after 24 weeks, versus 0.66% in the metformin control group. The magnitude of improvements was rather modest compared with drugs like Novo’s GLP-1 star med Ozempic.

Dorzagliatin’s approval comes as China has significantly squeezed the prices of older diabetes meds. In fact, Bayer’s Glucobay—sold in the U.S. as Precose—was among the most severely hit by China’s price-cutting scheme. Sales of Glucobay plunged in 2020 after Bayer slashed its price by 90% to win supply contracts under China’s volume-based procurement program. What’s more, Chinese authorities recently managed to get dozens of widely used insulin products to lower their prices by an average of 48%.

China represents a large diabetes market. The country had an estimated 140 million diabetes patients in 2021, half of whom were not diagnosed or treated, according to Hua. But relatively small efficacy and the availability of cheap options could make commercial life hard for dorzagliatin, despite additional marketing help from Bayer.

Still, Hua seems heavily invested in dorzagliatin. Almost the company’s entire pipeline revolves around the GKA, but those efforts remain in early-stage testing.

Under dorzagliatin’s development program, there’s a clinical trial-enabling study for diabetic kidney disease, early combination studies with Merck & Co.’s DPP-4 inhibitor Januvia, Eli Lilly and Boehringer Ingelheim’s SGLT-2 med Jardiance and insulin. The company also looks to branch out of diabetes. Clinical trial-enabling studies are being conducted for dorzagliatin in combination with Takeda’s Actos in NASH and with a GLP-1 agent in Alzheimer’s disease.

Hua’s stock price slid 24% during Monday’s trading in Hong Kong amid a wide tech sell-off.